Diversifying markets to promote sustainable tourism

  • Date: 2016-09-21

I. Background

For the past few years, the Taiwan government has devoted extensive effort to developing the tourism industry. Tourist arrivals have continued to rise, and the nation welcomed almost 7.9 million visitors—a 4.84 percent year-on-year increase—in the first nine months of 2016. During that same period, however, tourist arrivals from mainland China decreased by 7.7 percent, and the number of mainland travelers arriving on group tours fell by 19.6 percent.

So although the number of independent travelers from the mainland grew by 7.95 percent, the decrease in mainland group travelers has already affected domestic tourism-related industries, leading to widespread concern that this will have a broader impact on Taiwan’s tourism industry. To respond to this decrease and promote sustainable tourism industry development, the government will continue to welcome mainland tourists and promote cross-strait travel through the Taiwan Strait Tourism Association, the Cross-Strait Tourism Exchange Association and other means.

The government has also convened numerous meetings to understand industry concerns, while the relevant ministries and agencies, including the Tourism Bureau, will formulate concrete short and medium-term measures to address stabilizing the mainland market as a source of tourists, developing diversified markets, facilitating industry transformation, expanding domestic travel and aiding unemployed workers. These measures will help travel-related enterprises make structural adjustments and transform the industry while maintaining existing niche markets that foster sustainable development in Taiwan’s tourism sector.

 

II. Government’s position unchanged: welcome mainland tourists, support positive cross-strait people-to-people interaction

A. The government’s established policy is to promote mainland Chinese tourist travel to Taiwan. This policy helps develop the relevant industries on both sides, promote positive people-to-people interaction, reduce misunderstandings and reinforce mutual friendship. Affected by certain non-economic factors, however, the number of mainland citizens travelling to Taiwan has continued to fall. Response measures are already in place, while the government’s position remains unchanged: Taiwan welcomes mainland tourists and travelers from all over the world. 

B. The Tourism Bureau is assisting visits by various public sector industry associations to key mainland cities and provinces to promote Taiwan-bound tourism. The bureau is also supporting travel industry enterprises to design more in-depth, high-end travel packages based on seasonal, distribution and regional factors to encourage cross-strait cultural communication and an appreciation for the value of travel.

 

III. Spur tourist industry development by diversifying markets and optimizing travel products

A. Open up diversified markets and promote New Southbound tourism

1. Develop a more diversified tourist market and expand efforts in existing markets. In the  first nine months of this year tourism increased 18.25 percent from Japan, 33.72 percent from Korea, 8.53 percent from Malaysia, 42.85 percent from Thailand, 19.56 percent from Vietnam, and 15.89 percent from the Philippines, evidence that efforts to open diversified tourism markets have been effective.

2. Promote tourist-related industry participation in the New Southbound Policy, and expand tourism from Association of Southeast Asian Nations (ASEAN) countries and South Asia (i.e., India). Initiatives include granting 30-day visa-free privileges to Thai and Brunei nationals, which began on August 1 this year for a one-year trial period. Conditional visa-free status and e-visa privileges for tourist groups were also adopted for travelers from other Southeast Asian countries. On September 1, the number of countries eligible for a program simplifying visa procedures for high-end group tourists was expanded from four (Indonesia, India, Vietnam, Philippines) to seven, adding Laos, Cambodia and Myanmar. E-visa privileges were also extended to Philippine nationals beginning on October

Complementary measures have been proposed to market to Taiwan-friendly organizations, prepare the domestic hospitality environment, forge cooperative links between industry and academia, and strengthen bilateral relations and cooperation. These measures are expected to enhance external promotional efforts, encourage overseas students to get involved in tourism-related industries, and foster a Muslim-friendly environment.

 

B. Strengthen marketing efforts to stimulate the domestic travel market

1. To assist key industries and regions impacted by the decrease in mainland tourists by expanding the domestic travel market and facilitating travel-industry transformation, on November 4 the Tourism Bureau announced a subsidy program for the affected travel agencies. The program encourages school-sponsored educational field trips and promotes travel for neighborhood-based groups of senior citizens and civic groups. Travel agencies that previously hosted mainland tour groups can thus provide domestic tourism services instead, promoting theme-based itineraries at national scenic areas recommended by county and municipal governments and the Tourism Bureau. This will stimulate local economies and industries, expand the overall domestic travel market, boost non-holiday travel consumption, and increase job opportunities for Chinese-language tour guides.

2. Hold training for travel agencies involved with mainland tour groups to learn about developing new markets and transforming their businesses, as well as advance scouting and enterprise matchmaking activities. These measures are designed to give businesses the specialized operations expertise required to design innovative, theme-based travel products to transform their business model and open up new business opportunities. By conducting advance scouting for in-depth domestic travel and Muslim tourist itineraries as well as enterprise matchmaking workshops, travel agencies previously hosting mainland area tour groups, county and municipal governments, and other affected businesses will hopefully work together to promote travel-industry transformation and develop business opportunities in the domestic travel market.

 
C. Provide financial assistance 
1. Develop countermeasures for all sectors affected by the decrease in mainland travelers including the airline, lodging, tour bus, retail and restaurant industries to help them find viable solutions for the future by transforming their industry and developing new business opportunities.

 2. To address operating revenue issues, the Ministry of Economic Affairs will assist tourism-related industries in processing loan extensions to obtain the required operating funds and provide an amortization guarantee mechanism. The ministry will also provide financial relief measures including advisory services, diagnostic counseling, and creditor’s rights and debt consultation services.    

3. The government will provide the tourism industry with NT$30 billion (US$950 million) in preferential loans, with loan applications accepted based on the Directions for Preferential Loans for Upgrading the Tourism Industry. Businesses will enjoy preferential interest rates on loans to be used to improve software and hardware facilities, creating an optimized travel environment to enhance overall travel quality.
 

IV. Conclusion

In promoting tourism, the government welcomes travelers from around the world, including mainland China, to visit Taiwan. Although the reduction in the number of mainland tour groups may affect domestic tourism industries, it also presents an opportunity to transform those industries. Looking ahead, the government will facilitate the development of high-quality mainland tour groups; adjust industry operations; strengthen marketing efforts; increase the number of Taiwan-bound travelers from key mature markets such as Japan, Korea, Hong Kong, Macau, Singapore and Malaysia; continue to promote the long-distance European and U.S. markets; and strengthen brand channels. At the same time, the government will also continue to develop tourist markets in countries involved in the New Southbound Policy to attract travelers in the emerging ASEAN and Indian markets. The government expects these strategies to enhance the overall quality of the domestic tourism environment, help upgrade and transform tourism-related enterprises, strengthen competitiveness and promote sustainable tourism industry development so the world can see Taiwan’s soft power.