London missing out on Chinese tourists and trade, says new researchApril 28, 2016
Mayor urged to ditch City Hall’s vanity posters on the Tube and increase expenditure on promoting London abroad
London is failing to attract Chinese business and tourism because the Greater London Authority is not promoting the city properly abroad, a new report from London First has said.
The report identifies that London is less well placed that its rivals, such as Paris and Berlin. The result is that:
- Singapore has overtaken London as the largest centre for offshore Renminbi trading.
- Chinese people rate both Paris and New York as “more important” than London when asked to comment on their perception of international cities.
- London also offers fewer direct air routes to Chinese cities than competitor cities (excluding Hong Kong). The UK offers direct flights to only four Chinese cities (Beijing, Shanghai, Guangzhou and Chengdu), while Frankfurt serves six destinations and Paris Charles de Gaulle seven.
- Paris is estimated to receive up to 50% more Chinese tourists than London, boosted by its membership of the Schengen single visa arrangements through which 26 European countries collectively issue 1.4m visitor visas in China p.a. as opposed to the 390,000 UK visas issued there.
- The UK accounted for less than 1% of the total Chinese outbound tourism market in 2013. This is in part because the most popular destinations are short haul Asian countries. But even when we look at what Visit Britain defines as our competitor set only – Western economies of a similar distance from China and with a broadly comparable visitor offer – Britain still only ranks tenth in terms of market share.
- London needs to be promoting itself not just with China’s four first-tier cities (Beijing, Shanghai, Guangzhou and Shenzhen) because there are more than 50 second-tier cities in China with a per capita GDP over $10,000.
The report places the blame at the low level of expenditure on promoting London abroad. It says that London’s “modest promotional budget”, of £19m a year, is “dwarfed” by city states such as Singapore (budget: £201m) and Hong Kong (budget: £253m) and behind European competitors such as Paris (£34m) and Berlin (£22m). When city populations are taken into account, London spends less than a quarter as much per head as Berlin.
The capital’s promotional authority, London & Partners, would benefit from a ring-fenced strategic fund to “scale up London’s promotion” in the markets of the future.
The report provides examples to illustrate how a fund could be set up:
- Transport for London’s poster sites could be sold, not used for “vanity posters” promoting the Mayor, City Hall or Transport for London.
- Diverting 1 per cent of the money City Hall charges on council tax bills to London & Partners would increase its funding by £8m.
- London should partner with other UK destinations to promote holidays that involve visiting not just London, so that the perceived value increases.
Jo Valentine, Chief Executive of London First, said:
“We can’t rely just on attracting traditional markets such as American tourists, welcome as they are. We also need to build our brand in the emerging economies too. Paris is just doing a much better job of attracting the Chinese – and every year we fail to market ourselves, we fall further behind.
“There are excessive numbers of vanity posters on the Tube promoting the Mayor and City Hall. If we sold all or most of these poster sites, we’d have more money to promote London abroad.
“With a new Mayor due in City Hall in less than one month, London First will be looking to them to take bold steps to invest in London’s international promotion.”