11/02/12, 23:19:57 EST

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China tourist deal in limbo

theglobeandmail.com

An agreement with China that would free the flow of Chinese tourists to Canada is in limbo, putting substance behind a recent warning from Chinese Ambassador Lu Shumin that Canada-China relations are being jeopardized by the actions of Prime Minister Stephen Harper's government.

And the Canadian Chamber of Commerce is urging the Harper government to make completing the agreement "a cornerstone of the Asia-Pacific trade strategy."

"Our message to our own government is to get this moving," said Mike Murphy, executive vice-president at the Chamber. "Think about the difficulties the tourism sector is already having for a number of reasons. This is a giant opportunity. The potential for increase in visits is tremendous."

The World Tourism Organization is forecasting that by 2020, more than 100 million Chinese citizens are expected to travel to other countries as tourists.

Nearly two years ago, China announced it would grant Approved Destination Status (ADS) to Canada. ADS allows Canadian tourism organizations to actively market the country in China, and it allows Chinese travel agents to promote Canada and offer tour packages to Chinese citizens.

Canadian tourism officials had originally hoped to see the ADS agreement signed by the end of 2006, but the last formal discussions between the two countries took place in January, and no further discussions have been scheduled. China has signed more than 90 ADS agreements, but both Canada and the U.S. are conspicuous by their absence.

Mr. Lu's warning about deteriorating relations came Friday ahead of this week's visit to Canada by the Dalai Lama. While there is no formal connection between the visit and the stalled talks, it is seen as one of several irritants between Canada and China.

Michael O'Shaughnessy, a spokesperson at Foreign Affairs and International Trade, said ADS negotiations are taking place. "The issue is being advanced through formal talks as well as between officials at the working level," he said. "Issues related to ADS are complex, with implications for China's domestic legal framework as well as Canadian immigration regulations. Best efforts are being made to achieve a satisfactory result."

Jock Finlayson of the Business Council of British Columbia, said "We've entered a period where relations with China are quite difficult generally. The ADS was announced with great fanfare a couple of years ago, the question now is, is it ever going to come to fruition period? I suspect the Dalai Lama's visit is not going to help much in that regard."

Mr. Finlayson questions whether Canada will ever develop the kind of strategy needed to get appropriate positive attention from China.

"It's not evident we have a strategy," he said. "And we're talking about a multifaceted thing here - with a nation that is likely to be the second-biggest economy in the world in the next few years and according to Goldman Sachs, the biggest by 2040."

Mr. Finlayson went on to point out that with the high value of the Canadian dollar and new passport requirements about to kick in at the U.S. border, Canada needs to develop other markets for tourism and China is an obvious one.

Chinese citizens are travelling to Canada in ever-increasing numbers. Tourist Industry Association of Canada (TIAC) statistics show 117,000 Chinese citizens came to Canada in 2005, up 15 per cent from 2004. But without ADS, the Chamber of Commerce argues, Canada is "losing significant competitive ground." TIAC estimates current revenues ($150-million annually) could double or triple with ADS in place.

The Chamber is particularly concerned about the potential the U.S., also negotiating with China for an ADS agreement, may get approval ahead of Canada. "Chinese travellers are curious to get their first glimpse of Western nations, and should that first glimpse be the United States, it will not be easy to sell a second trip to what is an expensive destination, compared with other ADS markets in Europe and Australia," the Chamber said..

Darcy Rezac of the Vancouver Board of Trade echoed Mr. Finlayson's comments, although he didn't think the Dalai Lama's visit by itself was much of a factor.

"The biggest impediment to signing that [ADS] agreement comes out of Ottawa," he said. "Prime Minister Harper has been cool toward China. Quite frankly, it has puzzled us."

 Printable Version  | published Oct 29, 2007