Authorities step up to help beleaguered domestic tourism industry

Shanghai's authorities are boosting financial support to help enterprises in the tourism industry recover from the coronavirus outbreak.

Twelve new measures were released today to help businesses in the tourism industry impacted by the pandemic and fuel their development.

"Tourism is among the worst hit industries by the COVID-19 pandemic, and efforts have already been made to offset the impact and help companies resume normal operations," Fang Shizhong, director of the Shanghai Administration of Culture and Tourism, told a press conference today. "As the pandemic is under control in the nation, China's tourism industry is recovering, and pent-up tourism demand has been released in the domestic tourism market, calling for new measures."

Last year, Shanghai brought in 313.978 billion yuan (US$48.86 billion) of tourism revenue, down 43 percent from 2019.

In the first five months of this year, the average occupancy rate of star hotels in the city hit 49 percent, a rise of 28 percent from the same period last year – but 15 percent lower than 2019.

"The measures aim to accelerate the recovery of Shanghai's tourism industry, and boost companies' confidence with a highlight of long-term development in the industry," said Fang. 

The city recorded 236 million visits by domestic tourists last year, and domestic tourism revenue of 280.95 billion yuan, recovering 65 percent and 59 percent from a year earlier and 17 percent and 19.7 percent higher than the nation's average respectively, according to the administration.

"The development of the city's tourism industry is stronger than the nation's average, while scattered coronavirus cases this year still put pressure on the revitalization of the industry," said Fang. 

Last year, measures such as reduction and exemption of property rents and utility fees were undertaken to help companies get through the impact of the pandemic. 

Many tourist operators, such as scenic spots, hotels and travel agencies, expressed hope that authorities would continue these policies, and deliver additional help to help them expand tourist sources and financing, said Fang. 

The 12 new measures cover a wide range of areas. 

The measures will deliver help to small and medium-size travel agencies related to loan applications and expanding their financing means to ease financial pressure, the administration said. 

A number of agreements were signed by authorities and banks today to establish a 24-hour financial service platform that helps small and medium-size players in the industry tackle their financial difficulties. 

As part of the industry relief measures, tourism-service quality assurance deposits will be returned to travel agencies in the city, the administration announced. 

The returns are a temporary measure, and full deposits should be paid back to the authority before February 5, 2022.

The deposits are used to compensate tourists in disputes over contracts or situations such as travel agencies going bankrupt.

A replacement solution is being worked out and will be launched when the deposit payment is due, according to the administration.

"Tourism companies will be helped to expand their financing means via private equity fund investment, listing on stock markets and issuing bonds," said Fang. 

Support will also be delivered to tourism companies to encourage them to develop new products, itineraries and services, and efforts will be stepped up to develop "red" education and tour, Huangpu River cruise, ancient town, intangible cultural heritage and architecture-themed tours.

Subsidies will be delivered to tourism companies to cover their training fees. 

The COVID-19 pandemic prompted the development of digital and technology-driven tourism, which has changed tourism consumption habits, Fang said.

"Global tourism has been replaced by domestic and local tourism, and private tour groups with three to five people who are usually family members are increasingly popular," he said. "Meanwhile, tourism preferences are changing from traditional sightseeing tours to in-depth and leisure tours." 

The measures highlight the industry's digital transformation in response to these changes. 

Digital tourism projects such as "single-code" admission and fast check-in and check-out at hotels will be given priority under the measures. 

Companies are encouraged to provide smart services such as e-maps and audio guides. 

By the end of this year, 20 digital-oriented tourist attractions and 600 digital hotels will be established in the city. 

Shanghai's annual tourism revenue is projected to reach 700 billion yuan by the end of 2025, accounting for 6 percent of the city's GDP.