COVID 19 is a point of massive change and extraordinary opportunity for tourism

The last big economic crisis in 2008/9 ruined all the hard-won successes of sustainable tourism. The accountants, the venture capitalists, the marginal costers, the web-based spin merchants, Wall Street saw to that. To see how that worked read my book.

In terms of numbers, after 2008 they soared. In terms of benefits for those that needed and were entitled to them - destination communities, this mass tourism just added insult to injury

So now we have another, bigger crisis on our hands.

Already airlines can't pay for their planes that they bought on the expectation of massive passenger and load factor growth.

And the big producers are just on the point of paying for customers to take their oil because storage is running out.

And the biggest of them all TUI has had to get a €2 billion loan from KfW - the German development bank.

But on the bright side - the Planet is having a holiday from all the excesses we have laid on it. The economy and human activity has slowed as we painfully learn to work together.

And… prime assets are cheap.

All this and we are only a few months into a problem that will last for years
But there is a light at the end of the tunnel - an industry that is truly sustainable - by this I mean economically sustainable, culturally sustainable, socially sustainable and environmentally sustainable.

That means dramatically less air and cruise tourists, fewer tourists in iconic destinations, less imported food in all destinations, proper carrying capacity restrictions.

Plus above all, tourists who respect and feel gratitude for the fact that they can travel.
And this could lead to higher, more sustainable profits, better service, far better benefits for destinations. In all a really healthy global tourism industry with real opportunities for millions of real people.

I've been in the travel industry too long to believe that any industry initiative could possibly make this happen.

So what will?

Simply market pressure. As soon as people REALLY get the message that a healthy world, and a healthy tourism economy is good for them as individuals - their attitude will change. And tourism will obey the market - as ever.

The fact is that COVID 19 is a game changer. Surely, we realise that this is also a massive warning to every one of us individually?

And you may think that the travel and tourism industry has stopped. But it hasn't. The real powers in tourism are rising, working, recognising the opportunity and flexing their muscles.

The World Bank (remember the people that created our geography of global tourism from Mexico to Bali?) is laying the path with its tourism clients around the world for a sustainable 2021 and clever destination managers all over the globe have seen the writing on the wall and got the message: SERIOUSLY PREPARE FOR SUSTAINABLE TOURISM.

Of course, there is a COVID 19 price to pay. There will certainly be airline failures and industry consolidation. There will certainly be hundreds of thousands of travel and tourism industry bankruptcies. There will be lots and lots of cheap assets - particularly properties and companies big and small who extended themselves far too far when the fabulous river of cash dried up.

Is this new era of 'Responsible Capitalism' forged by COVID 19 going to bring in an era of responsible sustainable tourism? Probably not. But certainly, the opportunity exists and there will be no choice if the fickle marketplace gets the message!

Valere Tjolle
Valere is the author of 'You Lucky People' the story of travel - the world's most delightful and devastating industry. Find out more about it HERE

The New Silk Road is China's tourism route to unprecedented global economic power and political influence.










Photo Bertelsman Foundation

By October 2049 the world of tourism will have dramatically changed. China will have seen to that.
By the hundredth anniversary of the People's Republic of China, the massive economic area free trade zone envisaged by the 'Belt and Road' scheme - will come into full operation as forecast.
Extending all the way from inner China to the heart of Europe, Chinese high-speed trains are bringing avid travellers to stay in Chinese branded hotels, to buy Chinese manufactured goods and souvenirs and to eat Chinese foods.

In 2019 China World Number 1 in outbound tourism with around 200 million international travellers a year. By 2049 at the present rate of growth the figure is likely to be more like 600 million up to maybe a billion.

Ultimately COVID-19 will not change that at all. Generally the Chinese that travel are well off and in search of unique experiences they can only get in the West. Moreover as Coronavirus has spread from China which currently has far the greatest numbers of cases - a visit to the west could be seen safer than a visit in China - especially for those Chinese that already have immunity. When travel bans are lifted, Chinese tourists are ready to rock.

These travellers will have billions to spend and you can be sure that China's centrally-managed tourism will make sure that it is spent where China wants it to be spent.

The Chinese government calls the massive Belt and Road initiative "a bid to enhance regional connectivity and embrace a brighter future". Cultural and economic initiatives are merged in tourism and the Silk Road tourism initiatives will certainly be geared to Chinese tastes.

There have already been plans for major Las Vegas-style casino cities and winter sports centres in and around Kazakhstan and there will certainly be more.

The entire vast Silk Road system will be interconnected in economically-protected tax haven free trade zones. Through China, Kazakhstan, Tajikistan and Uzbekistan all the way to Hungary and Europe. To the US via the North Silk Road and Africa via the South  This is also likely to bring to the fore historic Silk Road Cities (of which there are hundreds) such as Samarkand, Kabul, Shiraz, Almaty, and many more. Add to these the many destinations in South East Asia and this adds up to truly colossal economic power.

The initiative calls for the integration of the region into a cohesive economic area through building infrastructure, increasing cultural exchanges, and broadening trade. Apart from this zone, another area that is said to be included in the extension of this 'belt' is South Asia and Southeast Asia. Many of the countries that are part of this belt are also members of the China-led Asian Infrastructure Investment Bank (AIIB). North, central and south belts are proposed.
 
The North Belt would go through Central Asia and Russia to Europe. The Central Belt goes through Central Asia and West Asia to the Persian Gulf and the Mediterranean.

The South Belt starts from China to Southeast Asia and South Asia, to the Indian Ocean through Pakistan. The Chinese One Belt strategy will integrate with Central Asia through Kazakhstan's Nurly Zhol infrastructure program.
 
The Silk Road Land Corridors:
 
The New Eurasian Land Bridge runs from Western China to Western Russia through Kazakhstan and includes the Silk Road Railway through China's Xinjiang Autonomous Region, Kazakhstan, Russia, Belarus, Poland and Germany.

• The China-Mongolia-Russia Corridor will run from Northern China to the Russian Far East. The Russian government established the Russian Direct Investment Fund and China Investment Corporation, a Chinese government investment agency, partnered in 2012 to create the Sino-Russian Investment Fund, which concentrates on potentially huge opportunities in bilateral integration.
• The China-Central Asia-West Asia Corridor will run from Western China to Turkey.
• The China-Indochina Peninsula Corridor will run from Southern China to Singapore.
• The Bangladesh-China-India-Myanmar (BCIM) Economic Corridor runs from southern China to Myanmar and is officially classified as "closely related to the Belt and Road Initiative".
• The China-Pakistan Economic Corridor (also known by the acronym CPEC), also classified as "closely related to the Belt and Road Initiative" is a US$62 billion collection of infrastructure projects throughout Pakistan that aims to rapidly modernise Pakistan's transportation networks, energy infrastructure and economy. On November 13, 2016, CPEC became partly operational when Chinese cargo was transported overland to Gwadar Port for onward maritime shipment to Africa and West Asia.

 Maritime Silk Road
The "21st Century Maritime Silk Road" is a complementary initiative aimed at investing and fostering collaboration in Southeast Asia, Oceania, and North Africa, through several contiguous bodies of water: the South China Sea, the South Pacific Ocean, and the wider Indian Ocean area.
 
Like its sister initiative the Silk Road Economic Belt, most countries in this area have joined the China-led Asian Infrastructure Investment Bank.
 
Ice Silk Road
 
In addition to the Maritime Silk Road, Xi Jinping also urged the close cooperation between Russia and China to carry out the Northern Sea Route cooperation to realize an "Ice Silk Road" to foster development in the Arctic region. China COSCO Shipping Corp. has completed several trial trips on Arctic shipping routes, the Transport departments from both countries are constantly improving policies and laws related to development in the Arctic, and Chinese and Russian companies are, perhaps alarmingly, seeking cooperation on oil and gas exploration in the area and to advance comprehensive collaboration on infrastructure construction, tourism and scientific expeditions.
 
East Africa
 
In May 2014, Chinese Premier Li Keqiang visited Kenya to sign a cooperation agreement with the Kenyan government. Under this agreement, the Mombasa-Nairobi Standard Gauge Railway was constructed connecting Mombasa to Nairobi. After completion, the railroad stretches approximately 300 miles (480 km) costing around $250 million USD.
 
In September 2015, China's Sinomach signed a strategic, cooperative memorandum of understanding with General Electric. The memorandum of understanding set goals to build wind turbines, to promote clean energy programs and to increase the number of energy consumers in sub-Saharan Africa.
 
Hong Kong
 
During his 2016 policy address, Hong Kong's last chief executive Cy Leung announced his intention of setting up a Maritime Authority aimed at strengthening Hong Kong's maritime logistics in line with Beijing's economic policy. Leung mentioned "One Belt, One Road" no fewer than 48 times during the policy address, but details were scant.
 
These are just a few of the hundreds of mega-million dollar initiatives. There will certainly be more.
 
China is already the world's Number 1 tourism source market, it is unlikely that this position will change for the foreseeable future, particularly given the fact that it is forecast that up to 3 billion Asian residents will become middle class by 2050.

The city of OZ was scheduled to have no less than 48 casinos in Kazakhstan
 
Already the power of Chinese tourism is having a major effect on the Silk Road countries. For instance around Lake Baikal in Siberia there is local agitation as Chinese people continue buying up property; near Almaty in Kazakhstan a major tourism development is taking place to attract Chinese to gamble and relax; also in Kazakhstan a mass tourism ski development is being created to attract Chinese skiers.
 
It is a short step to Chinese-branded hotels, restaurants, shops and other Chinese-run businesses all along the Silk Road, even to Germany and Italy. It is an even shorter step to Chinese centrally-organised tourism taking place from China to the Mediterranean.
 
Furthermore, China will own land, railways, ports and duty-free shopping centres all along their road. The fact is: they already do.
 
The benefit to China? Wielding quasi-global economic and political power through outbound tourism. While it may remain a marginal phenomenon in demographic or trade terms, tourism is a crucial issue in contemporary China, a major object of governmentality and a means to push soft power initiatives to receptive countries.
 
China exercises soft power using outbound tourism (and arts and culture more broadly), in their soft power play.
 
Tourism has also been used to enforce the construction of borders and boundaries in the South China Sea, leading to rising tensions.

Just as many countries have eased their visa requirements for Chinese tourists, China has increasingly sought to police 'low-end' tourists who might undermine the Chinese authorities as they attempt to boost their influence on the international stage. The authorities have sought to attract members of the overseas Chinese community to China through Root-Seeking Tour Summer Camps, organized by the Overseas Chinese Affairs Office of the State Council, so as to teach the Chinese language and culture.
 
Questions have begun to emerge about the linkages between tourism and politics, tourism and human rights, tourism and international migration patterns, and the impact of returning Chinese tourists on Chinese society.
 
These questions place the global significance and impacts of Chinese tourists into a broader context. Chinese media increasingly highlight the growth of outbound tourism to particular counties, potential revenue and links to the Belt and Road Initiative.
 
While pitched as tourism projects, China has been accused of hiding its search for political, economic and military influence through tourism. As tourism projects embed infrastructure that supports the development of trade routes (global network of railways, roads, ports, pipelines, fibre-optic cables), does Chinese investment bring wealth, or will it be mainly kept within a closed loop of overseas Chinese communities and state-linked businesses?
 
In Forest City, Johor Bahru (Malaysia), Chinese tourists are encouraged to buy Chinese-built apartments in a US$100 billion development designed to include international schools, shopping malls, hotels and an immigration centre for approximately 700,000 Chinese residents.
 
The construction of the $1.4bn (£1.1bn) Port City project in Sri Lanka by the state-owned Chinese engineering firm China Communications Construction Company (CCCC) on 665 acres (2.6 sq km) of land is been marketed as "a new Dubai, with luxury hotels, shopping malls and a marina."
 
While China pledges that the New Silk Road will be open, transparent and environmentally friendly, many of these projects appear to lack transparency and accountability. There are concerns that the standard 99-year leases for these projects will lead to social, economic and environmental challenges, such as opaque funding, exorbitant claims regarding their tourism potential, corruption, and population displacement.
 
Questions are emerging over the differences between these projects and the past and current ones dominated by the West.
 
While the New Silk Road spans 65 different countries, Chinese tourism, more broadly, holds the potential to redefine the international industry, infrastructure, economies and even the governance of many more countries, as Beijing establishes its own norms, rules and institutions.
 
Valere Tjolle
Valere is the author of 'You Lucky People' the story of travel - the world's most delightful and devastating industry. Find out more about it HERE

 

Why is this the very best time to benefit from the Experience Economy?


This year is sure to be the worst the global travel industry has ever seen. COVID 19 will see to that and its challenges to our overblown global economy. So why start in the Experience Economy now?
 

Because it’s a massive opportunity and it may be your opportunity.
 
At the moment there are something like half a million micro-experience organisers around the world and their total sales nudge some £160 billion ($200 billion) annually. That means the average micro-experience organiser is already turning over £320,000 ($400,000) per year. And the field is growing rapidly.
 
What do they do? Simply said they share their passion with others. So, if you want a break from dull routine and you have a passion, now is the time to share it for profit!
 
Whether you’re passionate about food, cookery, about wine or beer, if you’re passionate about a a sport, riding or gliding or go-carting, about shopping or needlework or making mosaics, knitting or walking or you’re passionately knowledgeable about a place... or absolutely anything. Now is the time for action.
 
Why now? Because, for certain this year will see a rock bottom for the travel industry and from there the only way is up. You will start at the bottom of the curve and the graph and your opportunity goes up from there.
 
You don’t need big assets. You simply need to coordinate and manage your own plan. Remember the success of Airbnb, Tripadvisor, they had nothing but an idea at their beginning and soon they will be part of the past.
 
The future belongs to the growing sustainable band of micro-businesses and you could be a part of that future if you follow your dream.
 
And in this situation, unusually, governments and banks will be on your side.

Once upon a time, travel was about going there, doing stuff and coming back. The key was… Where was ‘there’? The pulling power of the destination dragged the passengers in.
 
Now, 60 years later, the old-style business has become top-heavy, stale, ordered and homogenised; margins are as thin as ever. This makes for low wages, brutal prices, unhappy destinations and disappointed tourists. There are so many people going to so few iconic places, it has become totally sad and unsustainable.
 
This is the opportunity for you to use the power of your experiences, your knowledge and your passion, rather than just the boring old destinations, to pull in your business.
 
So start now. Choose your passion and combine it with your business plan. You are half way there already.
 
Remember you don’t need great big physical or financial assets, in fact, in the beginning they will be a hindrance. You’ll need to be a coordinator, choosing the settings for your experiences and creating local partnerships. In operating this way your activity will be sustainable too.
 
And together, we’ll explore more of what that means in my next post…

Sincerely yours,
Valere Tjolle

Valere is the author of 'You Lucky People' the story of travel - the world's most delightful and devastating industry. Find out more about it HERE