Campaigning for office in 2008, President Ma Ying-jeou (馬英九) promised an economic windfall of US$2 billion a year by opening the gates to Chinese tourism. If the Tourism Bureau is to be believed, Ma has achieved precisely that as he heads into elections in January for a possible second term.
However, interviews with industry officials and Taiwanese tour operators, as well as an examination of China’s Taiwan tour packages, suggest that the figure has been overstated by at least US$700 million. Questions about the accuracy of the government’s claims could prove embarrassing to Ma as campaigning heats up.
Tourism has been a big part of Ma’s push to deepen links with China and his re-election campaign is expected to once again tout the benefits of hitching Taiwan’s economy to China’s lucrative markets.
While trade between the sides and Taiwanese investment in China has flourished for the past two decades, Chinese visitors were mostly kept at arm’s length until Ma took office in 2008.
Ma reversed his predecessor’s more careful policy on China, initially sanctioning 300 Chinese arrivals a day. Until late last month, when the first individual visitors crossed the 160km wide Taiwan Strait, all tourists had to come on tour packages.
Alice Chen of the Tourism Bureau said the Chinese tourist influx has meant big money for Taiwan.
Last year, about 1.16 million Chinese tourists spent NT$59.1 billion (US$2 billion) in Taiwan, providing a substantial boost for an industry long in the doldrums, the Tourism Bureau says.
The bureau’s figures, Chen says, were collated on the basis of interviews at airports with just 1,896 of the 1 million-plus Chinese visitors, rather than relying on hard data from vendors of tourist services — hotels, restaurants, shopping venues and the like.
In response to a query, Ma spokesman Fan Chiang Tai-chi (范姜泰基) referred reporters back to the Tourism Bureau, whose deputy director-general Wayne Liu (劉喜臨) repeatedly refused interview requests.
Chen said she could not explain the discrepancies.
On the Taiwanese side, tour operators say they are taking the brunt of the China revenue shortfall, operating at a loss and churning tourists through shops that promise hefty commissions on sales to claw back some profit.
The government estimates that Chinese tourists spent an average of US$246 a day in Taiwan last year. That was made up of US$142 for shopping and US$104 for the services that are provided by tour package operators — hotels, meals, local transportation, venue admission and incidentals.
However, an examination of tour package prices shows they are much lower than the government’s estimate and tour operators say that, at best, they get half of the money Chinese tourists pay to Chinese tour agencies for these tours.
That amounts to at least a US$700 million hole in the government figure.
On top of that, it is likely that some of the money Chinese tourists spend on shopping is ending up in Hong Kong, where the owners of some of the major Taiwanese shopping outlets are based.
And at least until recently, a ruse involving special credit card readers that disguised the true location of purchases meant the government was cheated out of sales tax from Chinese tourists. Taiwanese authorities are now investigating this practice.
The typical tour of Taiwan lasts eight days and costs between 3,700 and 8,000 yuan (US$574 to US$1,240), depending on airfare from the Chinese point of embarkation.