Promoting Inbound and Outbound Tourism Recovery with More Open Regionalism

2022-07-23 15:16:00       Size:[L  M  S]

Promoting Inbound and Outbound Tourism Recovery with More Open Regionalism

-- Speech at the Opening Ceremony of International Tourism Exchange, Cooperation and Development Forum 

under RCEP Framework

(July 23rd, 2022, Kunming)

President of China Tourism Academy, Dai Bin

Currently, under the unabated COVID-19 pandemic and the sluggish economic recovery, the inbound and outbound tourism is confronted with uncertainty. The annual China International Travel Mart (CITM), alternately held by Shanghai and Kunming, is not only a major event for tourist destination promotions, trade in service, and industry cooperation, but also an opportunity for global tourism authorities to conduct bilateral and multilateral meetings for common topics. With the tremendous support from the Bureau of International Exchange and Cooperation of China’s Ministry of Culture and Tourism, China Tourism Academy (CTA) joins hands with Yunnan Provincial Department of Culture and Tourism and Kunming Municipal People’s Government to hold the International Tourism Exchange, Cooperation and Development Forum under RCEP Framework during CITM. Hundreds of government officials, industry representatives, experts, and scholars from the member states gather to discuss current tourism and economic situations, establish the future tourism cooperation mechanism, and publish research reports, authoritative data, development cases, and agreements. Now, I’d like to brief you on the highlights of the Special Research Report on RCEP and tourism industry before offering personal suggestions on promoting tourism recovery and prosperity through open regionalism.

I. RCEP will usher in long-term benefits to regional economy and world economy beyond tourism with open regionalism.

The concept of open regionalism is widely accepted by Asia-Pacific countries, among which China and ASEAN are pioneers in practice. At the Special Summit to Commemorate the 30th Anniversary of China-ASEAN Dialogue Relations held last year, President Xi Jinping reviewed on the experience in the development of bilateral ties, underlining to “uphold inclusiveness and mutual learning and jointly contributed to open regionalism”. During his attendance at the Seventh LMC Foreign Ministers’ Meeting and the G20 Foreign Ministers’ Meeting, Foreign Minister Wang Yi pointed out that for a long period of time in history, China and ASEAN countries have upheld open regionalism, advanced regional economic integration through free trade, promoted regional and sub-regional cooperation via equal consultation, and developed networks of friends worldwide with an open mindset. With concerted efforts, Asia has become a highland of development and promising land for cooperation.

The Regional Comprehensive Economic Partnership (RCEP) was initiated by ASEAN in 2012 and currently has 15 members including China, Japan, Republic of Korea (ROK), Australia, New Zealand and ten ASEAN countries. Through eight years of bilateral and multilateral consultations, the RCEP was officially signed and entered into force in November 2020. Statistics released by the International Monetary Fund (IMF) shows that by the end of 2020, among the 15 RCEP parties, the total population reached 2.27 billion, GDP, USD 26 trillion, and total export, USD 5 trillion, each accounting for about 30% of the world’s total. As the free trade bloc with the largest participating population in the world, the most diverse membership, and the greatest development potential, RCEP has injected fresh impetus to post-pandemic recovery and regional prosperity amid the slowdown in economic growth across countries. The irrevocable commitment to openness pledged by RCEP member countries has greatly confirmed market access expectations, which avails for enhancing mutual trust and confidence in development, and signals all-round cooperation including tourism.

The point of RCEP is to enhance market access of trade in goods, trade in services, investment and flow of people, building a sound system for the flow of people and development of tourism among member countries. In terms of trade in goods, all member countries have pledged that more than 90% of intra-region trade in goods will eventually achieve zero tariffs through immediate tariff reductions and gradual tariff reductions within a decade. RCEP adopts the rules of origin accumulation, and has established high-level rules on customs procedures, inspection and quarantine and technical standards. This means that more high-quality consumer goods from member countries will gain access to the intra-regional market with lower tariffs, bringing efficiency and facilitation to cross-border e-commerce, traveling and shopping. In terms of trade in services, the openness to trade in services in strategic sectors such as finance, law, construction, and shipping will be further improved. In terms of investment, the consultations on investment access will be promoted by applying the Negative List and Specific Commitments for Services, thus effectively stimulating the growth in business, conferences, exhibitions and incentive travel markets. In terms of the flow of people, RCEP grants greater facilitation to the temporary cross-border movement of natural persons, and expands the commitment scope from service providers to include all categories of natural persons that might move across borders under the agreement, such as investors, accompanying spouses and family. The new rules facilitate high-frequency and short-term cross-border flow of people, driving the growth of market segments such as tourism, leisure, vacation, and study tours.

The Chinese government puts the implementation of RCEP commitments high on the agenda. Premier Li Keqiang stressed on the implementation of RCEP, enhancing corporate competitiveness in the global market by leveraging the opportunity, and embracing greater openness in trade and investment. Departments including the Ministry of Commerce and the General Administration of Customs have issued a catalogue of notices and guiding opinions on RCEP. The Guiding Opinions on the High-Quality Implementation of the Regional Comprehensive Economic Partnership (RCEP) jointly issued by six departments including the Ministry of Commerce and the National Development and Reform Commission of China gives instructions to localities and enterprises on seizing the development opportunities unleashed by RCEP. Beijing, Shanghai, Zhejiang, Jiangsu, Shandong, and Guangdong have issued policies and guidelines for promoting RCEP, encouraging enterprises to understand and leverage RCEP. The Beijing Municipal Commerce Bureau issued the Action Plan to Seize the Opportunities of RCEP and Facilitate the High-quality Development of the “Two Zones” in May this year, which proposes to foster a sound environment for developing trade in services, and to strengthen the trade in services cooperation with RCEP member countries in education, environmental protection, healthcare, software, IT and other fields. In Q1 2022, China’s total import and export to the other 14 RCEP member countries exceeded RMB 2 trillion, increased by 6.9% YoY, accounting for 30.4% of China’s total foreign trade during the same period. Among them, the YoY growth rate of import and export with ROK, Malaysia and other countries exceeded double digits.

II. There is a lack of systematic research on RCEP in the tourism sector, in particular, the policy support for the recovery of inbound and outbound tourism markets and industry cooperation are in dire need of reinforcement.

RCEP shares close ties with the intra-regional tourism market and will certainly cast a remarkable impact on the recovery and development of inbound and outbound tourism markets. In 2019, the overseas tourists received by RCEP member countries reached a total of 380 million visits, with the foreign exchange income from tourism exceeding USD 300 billion, accounting for 19% and 21% of the world’s total, respectively. The total RCEP outbound tourists reached 260 million visits, contributing to more than USD 430 billion in tourism spending, accounting for 24% and 31% of the world’s total, respectively. In 2019, ten of the RCEP member countries including Vietnam, Thailand, Japan, and ROK are ranked among the top 15 countries (regions) of outbound tourist destinations for Chinese citizens. Inbound tourists from RCEP member countries to China account for 66.67% of China’s total inbound tourists, and RCEP member countries including ROK, Myanmar, Vietnam, Japan, Malaysia, the Philippines, and Singapore are firmly ranked among the top 10 foreign sources of tourists. Besides, Bangkok, Tokyo, Singapore, Osaka, Kuala Lumpur, Kyoto, Chiengmai, Seoul, Bali, and Pattaya have been listed among favorite tourist destinations of Chinese visitors.

With the accelerated implementation of RCEP commitments, the significance of member countries for China’s inbound and outbound tourism markets and trade in tourism services was once on the rise. Regrettably, the COVID-19 outbreak in early 2020 took a heavy toll on international tourism, especially inbound and outbound tourism between China and RCEP member countries, inflicting a complete standstill. A comprehensive measurement of the research group of China Tourism Academy (Data Center of the Ministry of Culture and Tourism) that supposes the COVID-19 pandemic were completely subdued predicts that, in recovery scenarios at high and lower levels, the amount of outbound tourists from China to RCEP tourist destinations the same year would be 41 million visits and 96 million visits, respectively; and inbound tourists from RCEP member countries to China, 29 million visits and 63 million visits, respectively. In the context of ongoing COVID-19, with the priority to the safety of tourist destination, Chinese outbound visitors prefer Tokyo, Bangkok, Kyoto, Osaka, Seoul, Chiengmai, Bali, Sapporo, Pattaya, and Sydney as well as the ice and snow resorts including Kyoto, Sapporo, Seoul, Kitaazumi-gun, Yamagata, Furano, Otaru, Hachimantai, Aomori, and Chuncheon.

More facilitation policies for the flow of people are required to enhance the openness of RCEP trade and investment. With the increase in the flow of business people among members, more tourists and tourism spending will be ushered in. The solid tourism industry foundation and increasingly frequent trade in tourism services among RCEP members facilitate the refactoring and upgrading of the tourism industry chain, and the integration of regional tourism factors. In particular, high-quality human resources, technology, finance and cultural creativity will add new momentum to the development of tourism. In view of the cross-border flow of the operation and management talents of luxury hotels and boutique homestays, the senior coaches of outdoor diving, sailing, and surfing sports, the managers of resorts and vacation spots, and the professional teams of camping and self-driving, and professional talents urgently needed by modern tourism, the high-quality development of the tourism industry will empowered. In particular, it upgrades professional supply for self-driving tours, night tours, study tours, ice and snow tours and other segments alike.

RCEP will facilitate the construction and promotion of characteristic international tourist destinations, and tourism is likely to be part and parcel on the early harvest list. The opening-up pattern of RCEP not only encourages market players to seek cooperation in technology, industry and talents, and to promote innovation in technology, management and business models, but also accelerates the construction of international destinations and “one journey with multiple stops” international travelling routes among China and other member countries from market, industry and culture facets. Apart from international metropolises such as Beijing, Shanghai, Hong Kong, Singapore City, Bangkok, Jakarta, Hanoi, Tokyo, and Seoul, Guilin with the most beautiful scenery in China, Tibet with the third pole in the world, coastal resorts Phuket and Nha Trang, cultural heritage destinations Angkor Wat and Luang Prabang, and numerous border areas and port cities will gain benefits.

With the implementation of RCEP, the tourism industry of member countries will engage in competition and cooperation in more fields and at a higher level. The infrastructure construction, public services, tourism promotion, digital economy, human resources and opening up at destinations will pose higher demands. Actually, the tourism sector knows little about RCEP, let alone specific contents. A special survey conducted by CTA (Data Center of the Ministry of Culture and Tourism) on travel service providers such as travel agencies and OTAs shows that more than 80% of business heads lack the basic knowledge of RCEP, and some have never even heard of RCEP, drawing a sharp contrast with market players of trade in goods. Among the respondents who know about RCEP, more than 70% believe that RCEP will bring “greater market opportunities” and “more cooperation opportunities”, more than 50% of the market players have heard of RCEP but have no idea how to take part in it, and only a few companies have considered “technology introduction” and “talent introduction”. During market research and industry exchanges, more than 70% of the respondents believe that RCEP will intensify competition in the tourism market, international tourists will require higher service levels, and the future business model of the international tourism market will face pressure from system innovation. More than 30% believe that there are restrictions for joining CREP and applying relevant systems and rules. Overall, the tourism industry is still most concerned about the recovery of international tourism, and tourism authorities focus on domestic market promotion and brand building of the administrative system. There is a lack of due international perspectives, appropriate policy support and coping strategies towards the impact of international cooperation mechanisms on the tourism industry, such as the RCEP, Lancang-Mekong Cooperation, Bangladesh-China-India-Myanmar Economic Corridor, China-Pakistan Economic Corridor, China-Laos Railway, the Belt and Road Initiative, the BRICS, Shanghai Cooperation Organization, China and five Central Asian countries, and China and Central and Eastern Europe.
III. RCEP member countries need to embrace open multilateralism, innovate cooperation mechanisms, and propel the orderly recovery of inbound and outbound tourism markets and high-quality development of the tourism industry.

The tourism authorities of member countries and their think tanks should study the impact of RCEP on the tourism industry holistically, promoting the coordination and implementation of policies related to the flow of people, cross-border shopping and the establishment of tourism market players. On the basis of research and evaluation, it is imperative to further clarify the role and position of tourism in the RCEP policy framework, and draw wider attention of member countries to tourism; establish an intergovernmental tourism working mechanism that coordinates national tourism agenda and strategic goals, creating a more facilitating business environment and policy system for the high-quality development of tourism; leverage the potential and requirements for upgrading the facilitation of the flow of people under the RCEP framework, and actively promote the holistic improvement of inbound and outbound tourism facilitation; and bridge between the tourism policies under RCEP framework and the people-to-people and cultural exchange mechanisms in the Asia Tourism Promotion Plan, Lancang-Mekong Cooperation, ASEAN+China, Japan, ROK (10+3), Cultural Capital of East Asia, Asia-Pacific Economic Cooperation, and the Belt and Road Initiative, advancing tourism cooperation among member countries with openness and vision.

The tourism authorities of member countries and their think tanks should strengthen communication to enhance mutual understanding. Frequent visits between neighbors will foster people-to-people and cultural exchanges that promote industry cooperation. It is imperative to integrate the strengths of tourism think tanks, education, research and media sectors, strengthen cooperation between tourism chambers of commerce and professional associations, study the tourism sector of RCEP member countries one by one, and exchange market data and industry information in time. On the basis of systematic evaluation, it is essential to make clear the competitive strengths, cultivation of factors and development strategies in the regional and global tourism industry chains, and assume common but differentiated responsibilities in the regional tourism development system; inspire member countries to enhance the position of tourism, and make clear the market access progress of regional tourism and renewal of industry cooperation plan; propel the matchmaking of modern finance, modern technology, cultural industry, education and study tours with the tourist industry, and facilitate the integration of market rules, industrial facilities, factor markets, commodity markets, market supervision and anti-unfair competition rules in the tourism sector.

The tourism authorities of member countries and their think tanks should guide the tourism industry and market players to understand, join and leverage RCEP, and promote market innovation through system innovation. It is imperative to carry out various RCEP thematic trainings for local tourism authorities and market players, especially border areas, port cities, tourism groups, and travel service providers. The focus should be on market access, customs procedures and trade facilitation, trade in services and investment, and commitments and implementation points of trade digitization. It is essential to strengthen policy communication and information sharing with authorities of commerce, customs, immigration, ports, aviation, and railways so as to strengthen cooperation in tourism data statistics and data analysis; publish special documents such as The Impact of RCEP on Tourism and Policy Recommendations, Report on RCEP Tourism Statistics, and Guidelines for Tourism Cooperation among RCEP Member Countries; establish a sound early warning and sharing mechanism for tourism industry and investment among RCEP members; encourage cooperation between the aviation, railway, highway and marine authorities and the tourism industry in developing new products such as cross-border self-driving tours, special train tours, and cruise tourism, and promote the construction of border tourism demonstration zones and cross-border tourism pilot zones.

The tourism sector should promote the orderly recovery of inbound and outbound tourism markets under the premise of effective pandemic prevention and control. Friendship, which derives from close contact between the tourism authorities and the tourism industry, holds the key to sound relations among member countries. As the Chinese saying goes, “read ten thousand books, travel ten thousand miles.” Traveling has been advocated by the Chinese nation since ancient times, and outbound tourism is especially an aspiration for people. Developing inbound tourism while orderly expanding outbound tourism is the responsibility of tourism authorities around the world. RCEP member countries are major sources of tourists and destinations for each other, and share expectations of recovering and expanding the inbound and outbound tourism markets. The recent resumption rate of international flights, the targeted pandemic prevention and control in foreign affairs, immigration, customs, health and other sectors, and non-tourism visa policies, including business, family visits, education, science, technology and cultural exchanges, all tend to facilitate the cross-border flow of people, suggesting a turning point of the international tourism market. In fact, except for the group travel of travel agencies and “air ticket + hotel” business of online travel agents, people holding travel documents are allowed to travel freely under the premise of abiding by the local pandemic prevention and control policies. The policy focus is on group travel and “air ticket + hotel” business, or rather how to open up the business of organizing foreign tours and domestic reception by travel agencies as soon as possible? There are doubts that since individuals can take flights, check in hotels, and visit scenic spots, why can’t organized tours? There is no data proof that organized group tourists are more likely to get infected or spread the virus than unorganized individual tourists. The tourism authorities of member countries should face up to each other’s expectations and call of the industry, and discuss on the pilot point-to-point group travel between cities and countries. They need to communicate with travel agencies and online travel agents, and draft feasible, measurable and controllable roadmaps and timetables for the opening of inbound and outbound markets for group travel.

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