Let's Welcome Chinese Tourists

By J.W. Marriott Jr.
Saturday, February 18, 2006

One of the great benefits of China's rapid economic growth over the past decade is a quickly expanding middle class. And as in all societies with disposable income, the members of that growing middle class are beginning to explore the world.

By some estimates, Chinese travelers spend $75 billion a year traveling to such destinations as Hong Kong, Singapore, Australia, France, Germany and Italy -- everywhere, it seems, but the United States.

In fact, while the number of Chinese travelers has tripled in the past five years (to 32 million in 2005), fewer and fewer are coming to America. In 2000 some 250,000 Chinese visited our country; in 2004 just 200,000 did. In other words, Chinese travel to the United States has been decreasing by 5 percent a year at a time when the dollar has been weak, making travel here less expensive.

So why is the United States such an unpopular destination with the Chinese?

It's not. All else being equal, it's safe to say that many more would be flocking to our shores, as they did between 1999 and 2000, when Chinese travel to the United States jumped 18 percent. But all else isn't equal. Several factors keep Chinese travelers, and their tourist dollars, out of this country.

It starts with what the Chinese call "Approved Destination Status," or ADS, which is how the Chinese government designates countries that have complied with certain requirements to facilitate group travel to foreign countries. The United States is not on China's ADS list.

This has nothing to do with any geopolitical rivalry between our nations but with a combination of unintended consequences and cultural differences.

The first issue is that after Sept. 11, the United States tightened travel regulations across the board, requiring all visa applicants to be interviewed in person by U.S. consular officers. The problem is that China covers a vast expanse of territory, roughly comparable in size to the United States, and there are only five U.S. consulate offices in the entire nation. To demand that Chinese group travelers go hundreds of miles for an interview before they even know whether they'll be granted a visa is hugely burdensome.

To solve this problem, the Chinese want the United States to create a unique visitor visa reserved solely for group applicants from China. The United States, understandably, is reluctant to carve out exemptions for one country. In addition, for all that the Chinese have done to liberalize parts of their economy, we still have fundamental differences when it comes to ideas of fairness and free markets. The Chinese ADS program would require the U.S. government to grant specific U.S. travel agents exclusive contracts with China.

Needless to say, the United States cannot give preferential treatment to selected travel companies and grant them the profits from all inbound Chinese travel business. It would violate our laws and our most basic ideas of fairness.

So are we at an impasse?

I hope not. After all, the purpose of diplomacy is to overcome such impasses, especially when the interests of both countries are as clearly aligned as they are here. The United States, remember, is suffering a deep and continuing trade deficit. Encouraging increased travel and tourism to this country is essential to bringing our trade accounts into balance.

Meanwhile, the Chinese are hungry to absorb U.S. culture. They buy our consumer products and devour our movies, music and video games. Tens of thousands of Chinese come to study in our schools.

During the Cold War, our government subsidized cultural exchange programs between the United States and Soviet bloc countries because we believed exposing others to our way of life would convince them of the benefits of freedom and democracy. That same spirit should apply to China. But we don't need to subsidize such travel; we just need to let it happen.

The Commerce Department is negotiating with the Chinese. The State Department, which is responsible for visa processing, also needs to be at the table. Seventy-five other countries have signed ADS agreements with China. Of course, we should never jeopardize our security or our free-market principles. But with enough will, we should be able to create a solution that works for all sides.

The writer is chairman and chief executive officer of the hotel firm Marriott International Inc.

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