"Totally dead" is how the manager of a restaurant overlooking Shanghai's famous Bund described business this week. He was not alone. Across China, hoteliers, bar and restaurant owners, and virtually everyone else involved in the service industries is suffering.
The reason, as we have reported before, is China's new visa issuance rules, which have strangled business travel and leisure tourism to China and have forced swathes of expatriates to leave. As the Associated Press wrote this week, aside from the visa hassles foreign visitors "could be reluctant to book trips because China's authoritarian government seems more concerned with keeping out foreigners than welcoming them to the [Olympic] Games."
The world's press are also starting to focus on how the regulations are hurting Chinese companies. The LA Times this week reported from Yiwu, a city of around one million people that has built its economy around international trade of manufactured goods. Yiwu "boasts a wholesale mall that is the size of 350 football fields … where vendors sell all kinds of goods, including housewares and hammers, framed pictures of Jesus, Harley-Davidson look-alike motorcycles and Egyptian water pipes," the LA Times wrote.
At the moment, these usually teeming market halls are empty, as the foreign traders who populate them cannot get visas. Order flows have evaporated. This is having a huge knock-on effect for the manufacturing, sourcing, packaging, freight forwarding and transportation companies that underpin Yiwu's economy.
According to Paul French of research specialists Access Asia, Yiwu is far from suffering alone. "I passed through Yiwu, Wenzhou and Guangzhou this week and all are deserted, as buyers can't get visas," French says. He notes some serious potential consequences. Firstly, factory inspectors and quality assurance experts cannot currently obtain visas for China, so monitoring the goods produced by manufacturing companies whose margins are already tight is almost impossible. Secondly, he adds that a significant volume of orders is "already being shifted to countries like Vietnam."
The current situation appears to be ill-serving everyone involved - and it seems this has not gone unnoticed. The New York Times reports today that China's Ministry of Foreign Affairs is looking at ways to fix the situation. According the report, there will be "an internal review on July 7 or 8" to attempt to resolve some of the visa-related problems.
Last update : Sunday, 29 June 2008
|
|
|
News & Interviews 
(0 vote)
