[photopress:Olympics_hurdler_1.jpg,full,alignright]Beijing’s tourism chief has said again that there will be no intervention in the pricing of hotel rooms during the 2008 Olympic Games. This despite reports of exorbitant room rates and dwindling supply more than a year before the opening ceremony.
The China Daily quoted Beijing tourism administration director Du Jiang as saying that barring an extreme situation, authorities would let the market decide hotel rates.
What is an ‘extreme’ case? He gave an example. It would be if ‘a foreign visitor was being asked to pay $12,000 for a room despite a hotel having plenty of vacancies.’ He said, ‘At present, reservations are steadily coming in and the prices appear acceptable to both sides. So the administration has no plans to intervene.’
Local media reported that some Beijing hotels were quoting rooms up to 10 times above rack rate which is the listed price of a room before any discount. Many more are already booked out, having allocated 70 to 95% of rooms to Beijing Olympic organizers, sponsors and clients.
Du Jiang said Beijing, currently with 280,000 hotel rooms and another 57 hotels opening next year, would be able to accommodate the 290,000 people that Olympic organizers expected would need rooms every day of the Games.
He allowed that the supply of star-rated accommodation was a concern. He said, ‘More and more domestic travelers want to stay at star hotels instead of cheaper, unrated ones.’ More than two million domestic and foreign visitors are expected to visit Beijing during the Games.
Anyone who had experience of the Olympics in Athens would know that Du Jiang is in for an unpleasant surprise. Authorities in Athens pressed residents to open their homes to strangers to meet accommodation demands years before the 2004 Games. Many Australian visitors to the games stayed in tents rather than pay the staggering prices quoted. $2,000 a day was not uncommon.
Then, when everyone had made ad hoc arrangements and many visitors had cancelled their flights because of the hotel situation hoteliers slashed rates to fill vacant rooms just weeks before the opening ceremony. (Our illustration is from the Athens Games. Xiang Liu of China crosses the finish line in the 110m hurdles final at the Athens XXVIII Olympiad. Which is an image we should think of when considering the Athens Olympics.)
Those, and price gouging by taxi drivers, were the two most widely criticized aspects of the Athens games. The only way to keep the situation under control is for the administration to intervene at an early stage and make sure that the maximum charged is the rack rate plus, say, 50%.