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Friday, July 4, 2014, 10:06

S Korea wins over tourists from China

By KRISTINE YANG in Hong Kong / Asia Weekly
S Korea wins over tourists from China
Students perform to mark the birthday of Chinese philosopher and educator Confucius at Sungkyunkwan University in Seoul last September. South Korea is expected to amend visa rules to accomodate growing numbers of Chinese visitors. (AFP)
In the first three months of this year alone, more than half a million Chinese people traveled to South Korea for business and pleasure. That’s a 45 percent increase over the same period in 2013 and underscores a remarkable growth pattern, one that is unlikely to be reversed any time soon.

With the leaders of the two countries meeting on July 3-4, the potential for even easier travel between the neighbors is high.

There are widespread expectations that Chinese President Xi Jinping’s visit will help strengthen growing trade and tourism links. A cooling of relations between China and Japan makes the relationship with South Korea, one of the largest economies in Asia, even more significant.

One of the key expectations of Xi’s visit is the emergence of new visa-free policies that will allow for effortless travel between the two countries.

Tourism boost

“We are expecting more tourists from China,” says Lee Kang-wook, head of the international tourism research center at the Korea Culture and Tourism Institute.

According to the Korean Tourism Academy (KTA), the number of Japanese visitors to South Korea dropped 21.9 percent in 2013 and the number of visitors from nearby Thailand dropped 3.8 percent.

In comparison, the number of Chinese tourists hit a historic high in 2013, with 4.3 million trips, up 52 percent from a year earlier and accounting for 35.5 percent of South Korea’s inbound tourism, according to the KTA.

By 2018, as many as 8.4 million Chinese tourists could visit South Korea, says Martin Craigs, CEO of the Pacific Asia Travel Association (PATA), a body based in Bangkok with offices in Beijing.

Visa facilitation and investment in the tourism sector are likely to follow, Lee believes.

“With a big jump of Chinese tourists in Korea, we need to expand our carrying capacities; for instance, accommodation and tourist attractions,” he adds.

Lee says the countries are discussing a visa-free policy, but this is a complex process as it involves several different ministries and it is unclear how far along the process is.

At present, it can take several days to process a visa to South Korea for a Chinese national, while an express visa in Beijing takes two days to process.

Eliminating this process would certainly help attract more Chinese tourists, many of whom have been swept up in the “Korean wave”, which refers to the recent popularity of South Korean television shows, music (K-pop) and fashion in China.

The hit song Gangnam Style by Psy was a global success and brought the upscale Seoul neighborhood of Gangnam to the world. South Korean drama My Love from the Star is also extremely popular in China.

In the first quarter of 2014, South Korea’s embassy in Beijing issued some 560,000 visas to Chinese nationals, up 45 percent from the same period of last year. The number of visas issued in some regions more than doubled. In Wuhan, there was an increase of 213 percent while Dalian witnessed a 108 percent uptick.

The numbers might be even higher for the second quarter, as South Korea relaxed visa requirements for people of Korean Chinese ancestry in April. Reports in the South Korean media suggest visa applications have since surged.

“The government is smart enough to realize tourism’s contributions to the economy and job creation,” says Craigs of PATA. “I am very optimistic that the trade and tourism would be very considerable as their countries have capability and high ambitions.”

As the number of Chinese visitors to South Korea hits record highs, the South Koreans represented the largest group of visitors to China in 2013. Almost 4 million visited the nation last year, according to the China National Tourism Administration.

Kwon Young-se, South Korea’s ambassador to China, described Xi’s visit as one of “unparalleled significance”.

Kwon recently told Chinese media that Seoul will gradually expand visa exemptions to accommodate more Chinese visitors.

Visa issues

Chinese passport holders face more visa restrictions than many other nationalities. In fact, in a ranking of ease of travel of 204 countries by Movehub, a website aimed at prospective immigrants, a Chinese passport ranked 11th from the bottom.

Japanese citizens enjoy visa-free access to 170 countries, the highest in Asia, followed by Singapore with 167 countries. South Koreans can enter 166 countries without a visa.

Only 45 countries grant Chinese passport holders visa-free access or visas on landing. These include Laos, the Maldives, Myanmar, Nepal, Sri Lanka, Thailand, Brunei, Indonesia and Vietnam (with some restrictions).

South Korea has been gradually relaxing visa requirements for Chinese nationals. In 2012, it introduced a visa waiver for those visiting the country for less than 12 hours and for transit flights to Jeju Island from Incheon International Airport. In September, South Korea began providing multiple-entry visas for Shanghai and Beijing residents.

“Visa convenience is a very important contributor to motivate travel,” says Craigs. “These policies are developing and very important as Korea is trying to attract people to use it as a hub and spend maybe two nights exploring when they fly to further destinations in America and Europe.”

Providing more straightforward access to South Korea is just one way that the country can attract more Chinese visitors, and a number of developments aimed at attracting Chinese tourists are currently in the works.

In March, South Korea approved the very first foreign-owned casino, a joint venture between Las Vegas-based Caesars Entertainment and the Indonesian property developer Lippo. The casino will be located near Incheon International Airport and will include a hotel and shopping malls in addition to gambling facilities.

Japan’s Sega Sammy and Genting Singapore, the biggest casino operator in Southeast Asia, are also considering acquiring a casino license for South Korea. Earlier this year, Genting Singapore announced plans to team up with Hong Kong’s Landing International Development to build a $2.2 billion resort complex, including a casino with 700 tables, in Jeju Island that could open in 2017.

Chinese property developer Greenland Group, meanwhile, is planning to invest 6 billion yuan ($965 million) in Jeju Dream Tower, a 218-meter-high complex featuring a hotel, retail and entertainment, with Korea’s Lotte Group.

Of the 5.4 million people that visited the 17 casinos in operation across South Korea during 2012, 41 percent were from the Chinese mainland. Most of the casinos are located in Jeju Island and open to foreigners only.

Chinese nationals already enjoy visa-free access to Jeju Island, which is only a 90-minute flight from Shanghai. In 2013, Jeju, which is often compared to Hawaii, attracted 8.5 million domestic tourists and 2.3 million foreigners, 78 percent of which were from China.

In a three-year plan released in February, South Korean President Park Geun-hye pledged to reduce dependence on exports and bolster service industries such as tourism and software.

The country’s goal is to attract 17 million foreign tourists by 2018 according to the Korea Tourism Organization (KTO).

China represents its biggest hope of meeting this target, as the country is working to attract 10 million Chinese annually by 2020, says the KTO.

The number of Chinese outbound tourists has increased by more than 10 percent in the past five years — and South Korea has been among the top three most popular destinations, according to the China Tourism Academy.

With South Korea’s tourism ministry estimating that more than 2.5 million Chinese visitors spent an average of $2,150 in 2012 — more than any other nation — the economic contribution of Chinese tourists to the country’s coffers can’t be overlooked.

“Apart from the millions of jobs that tourism creates, it creates emphasis of understanding across the border, that definitely means the chance of conflict diminishing,” says Craigs.

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