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World's Travel Industry Gears Up For Globe-Trotting Chinese

Tuesday, 3 May 2011 | 10:57 PM ET

China's growing middle class is leading to a scramble among airlines, airports and tour operators keen to cash in on this trend.

A U.S. visa is shown by a tourist as the first group of Chinese tourists set out to visit US at the Beijing Capital International Airport on June 17, 2008 in Beijing, China.
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A U.S. visa is shown by a tourist as the first group of Chinese tourists set out to visit US at the Beijing Capital International Airport on June 17, 2008 in Beijing, China.

This year, China's outbound departures are predicted to top 65 million after reaching over 57 million in 2010, according to a report from the China Outbound Tourism Research Institute (COTRI). The UN World Travel Organization (UNWTO) estimates that there will be 100 million Chinese outbound trips by 2020.

International airlines that haven’t already established direct routes to China are rushing to do so.

Air Mauritius and South African Airlines will become the latest to set up links with direct flights to Shanghai and Beijing respectively, as early as July.

But airlines are not just targeting China’s major cities for direct routes. Australia and New Zealand are trying to encourage airlines to establish new links between tourist destinations in those countries and some of the China’s tier 2 cities.

China's largest carrier, China Southern Airlines, launched its first direct flight between the bustling business city of Guangzhou in the Pearl River delta and Auckland, New Zealand earlier this month. Australian cities Perth and Cairns are also in talks with airlines to create direct flights.

Speaking from the China-Australian Business Summit in Beijing, Tourism Australia Managing Director Andrew McEvoy told CNBC.com that Australian airports are actively seeking out new capacity to get more direct access to the fastest growing travel market in the world.

"It's an important market, because there's a lot of mix here — 167,000 students, a whole bunch of visitors, and business people," McEvoy says.

"We're in the time zone, so it's terrific to be in a region that's growing like that."

In 2010, over 450,000 Chinese visitors spent $3 billion in Australia, which was 20 percent more than the year before.

Growing Travel Demand

Pacific Asia Travel Association's (PATA) Director of Strategy Management, Kris Lim, says that in spite of a number of negative global events such SARS, the global recession, and H1N1 in the past decade, the demand for air travel to and from China has continued to grow at a rapid pace.

"What we're seeing here is that for any destinations within Asia-Pacific, and outside of the region that is intending to build their tourism sector, the connection to China will be a very important element," Lim says.

"Inbound is equally important — China has become a centre of commerce and business. There should be more capacities into China as their economy continues to improve."

"Some of those groups that go to Europe are 12,000 strong, and when you're sending a group of 12,000 — you have tremendous buying power." -Executive Chairman,CAPA, Peter Harbison

Some airlines are testing the waters with charter flights before launching direct routes. Earlier this year, China Eastern Airlines launched the first-ever chartered flight to Hawaii. Two months, and three chartered flights later, the airline is now seeking approval from China's aviation regulator for regular direct flights to Honolulu.

Europe and the Middle East are also trying to lure Chinese tourists with the promise of fashion, art and culture.

Last week, Air China announced the launch of a direct flight between Beijing and Milan starting June 15, along with a new service to Athens in May.

Large-Scale Group Travel

Executive Chairman of the Centre of Asia Pacific Aviation (CAPA) Peter Harbison says the industry has never seen group travel on the scale in which Chinese tourism operates.

"Some of those groups that go to Europe are 12,000 strong, and when you're sending a group of 12,000 — you have tremendous buying power," he says.

Tour operators can only send groups to countries that fall under China's Approved Destination Status (ADS).

Dubai has become a hot spot for Chinese tourists after the emirate received "approved destination" status from the Chinese government in 2009.

Hotels such as the world-renowned Burj Al Arab have hired a number of Chinese speaking staff, created brochures and programs in Mandarin and added Chinese cuisine to their menus.

During this year's Chinese New Year, almost 80 percent of the hotel's guests were from China, says Burj Al Arab operator Jumeirah Group.

Meanwhile in Europe, academic institutions are offering courses on Chinese culture for tour guides and travel agents, Lim says.

But, he says it will take a bit more time before countries are better able to cater for Chinese tourists, like the Japanese before them.