The Chinese have set their sights on the Caribbean—and particularly the region’s tourism business—as a significant investment target. And governments in the region, as well as the private sector, are welcoming them with open arms.
The Chinese government has already made several substantial direct investments and aims to do more, said Dr. Adam Wu, chief operating officer of China Business Network
, at last week’s Caribbean Hotel & Tourism Investment Conference in Montego Bay, Jamaica
. “There’s no myth to the reasons for the Chinese interest in the Caribbean,” Dr. Wu told the crowd, “Diplomacy and geopolitics lead to trade and investment.”
Dr. Wu, COO of China Business Network, speaking at
the Caribbean Hotel & Tourism Investment Summit.
Indeed, Dr. Wu held out both a carrot and a stick to the delegates. The primary carrot is billions in investment dollars ($7 billion in the Caribbean in 2009 alone) for a wide range of tourism and non-tourism projects, ranging from shipping ports to highways to cricket stadiums. In tourism, the Chinese have pledged $2.4 billion in financing for the 3,800-room Bahia Mar Resort in the Bahamas
. Also, the recently opened Montego Bay Convention Center was financed by the Chinese government and built by a Chinese construction company.
As to the stick, Dr. Wu hinted the Chinese could wield is political. Noting that 12 of the 23 countries in the world that still recognize the legitimacy of the government of Taiwan are in the Caribbean and Central America, Dr. Wu said, “those countries that do the right thing will be able to attract even more investment.”
Yet in a tone that was either conciliatory or contradictory, he added, “Lack of diplomatic relationships has not stopped Chinese from investing in or visiting those destinations.” As example, he cited a Chinese commitment to invest $462 million in Punta Perla, a stalled beachfront resort in the Dominican Republic, a country that still recognizes Taiwan and doesn’t have diplomatic relations with China.
The Internet is the mode of communication for 457 million Chinese. Jamaica has courted Chinese tourism, and developed a website in Chinese that received more than two million "hits" following a visit from Jamaica's minister of tourism, Edmund Bartlett.
"China has already invested in tourism facilities in the Bahamas, and they’re now looking at Jamaica,” said Bartlett, “I can’t say what or where, but keep your eyes open.”
Another carrot Dr. Wu dangled before the tourism executives at the conference is the prospect of an influx of Chinese tourists to the Caribbean. The numbers are compelling: The Chinese outbound travel market grew by 20.4% in 2010, and Dr. Wu cited a Boston Consulting Group study that forecast a $590-billion outbound travel market by 2020. Put another way, Dr. Wu said 100 million Chinese will be traveling internationally by 2015, compared to 57 million in 2010.
Dr. Wu said the Chinese tend to travel in groups and like to sightsee and visit multiple destinations. A typical Chinese tourist will spend up to $6,000 per trip. Finally, he offered some tips to hoteliers and other tourist providers on how to serve the Chinese market:
• Convey your message in Chinese. While 100 million middle-class Chinese families have the means to travel overseas, only 10 million people, or 0.7% of the population, can speak English.
• It’s the best to market online. Most Chinese travel professionals depend on the Internet to research and book travel. There are more Internet users in China (457 million) than the U.S. has in total population (311 million).
• The Chinese population doesn’t generally have access to the Internet accessed by the rest of the world, so marketers need to use the China Wide Web, the country’s own Internet.