Domestic travel opens to foreign travel agencies

[photopress:travel_agencies_abroad.jpg,full,alignright]China has announced it will soon ‘fully open’ its domestic travel market to foreign-owned travel agencies. This looks like being four months ahead of China’s scheduled November deadline under terms set by its entry into the World Trade Organization (WTO). Beginning July 1 foreign-funded travel agencies will be able to set up subsidiary offices without restrictions. At the moment an agency requires about $40,000 capital to set up an office in the Chinese domestic market.

Shao Qiwei, head of the China National Tourism Administration (CNTA), said: ‘We welcome the entry of the world’s big tourism companies and well-known brand names into China. It will help to enhance the competitiveness of Chinese tourism companies.’

In the past five years, 25 foreign-funded travel agencies have set up offices in China.

To encourage the industry’s development, CNTA is encouraging travel agencies to offer more travel products and service providers to upgrade service standards.

Yao Yuecan, president of the China International Travel Services, said small agencies are cutting prices to compete against traditional state-owned agencies. ‘It is not easy to survive in China’s market with a limited profit margin.’

Official statistics show China has the largest domestic tourism market in the world, registering 1.3 billion travelers in 2006 and further set to grow to 1.7 billion by 2010.
Source: Travel Video TV