Category: MNI View Created on Wednesday, 18 January 2012 07:32
I once had the view that learning Chinese (Mandarin) may not be such a bad idea. This was back in 1998 when I was at University, having just heard a talk about the global outlook for the next 20 years that had China written all over it.
Leaving University and working as a Financial/Global Markets Journalist, China again came into focus. Once again, I toyed with the idea that learning Mandarin may not be so bad a prospect after all. Well, I never actually pursued it; I explored it, but assessed my time would not be best served at that stage learning what seemed to be a very complex language.
The Economist Intelligence Unit (A Division of The Economist publication) recently released a report on the 2012 outlook for the Caribbean. They mention that “as governments cope with severe fiscal constraints amid high levels of public debt, inequality and poverty levels will rise, reversing some of the progress made in the past decade.”
Should Caribbean governments and their citizens be overly concerned? Some will say there is no cause for alarm but reading further into the report, they shared a view on tourism in the region. They stated, “The performance of the region's key tourism sector continues to improve. However, according to recent data, total arrival figures are generally below pre-crisis levels.”
Coupled with that statement there was a previous statement made in 2011 by a top Caribbean tourism official that highlighted that while cruise ship visitor numbers did look well, tourists were not spending much money once they come ashore.
What does this have to do with China you ask? An immense deal, would be my response. As I look at the economic prospects for the region, China comes into focus.
The Chinese have been spending heavily in the Caribbean recently, over US$7 billion over the last two years. Seeing such an inflow, many analysts asked the question as to what does China want with the Caribbean?
I too was perplexed and wrote a piece examining that very question last year. The final assessment was that it was a strategically diplomatic move to gain influence, which involved a not so subtle power play to do with both Taiwan and the United States. Geopolitics can be intriguing and equally frightening but China’s whipping stick against Taiwan and the United States is its economic might. It is this economic might that I believe will be key for the economic fortunes of our small island Caribbean states. I am speaking here beyond monies committed to infrastructure development programmes.
The traditional Western sources of funding for development for the Caribbean are themselves struggling economically. Many forecasters are of the view that further tightening will ensue, and this will adversely affect many developing economies, an umbrella that the Caribbean falls under. The crumbs falling from the once rich table of abundance are now sparse and dire. The party has truly been taken down a few decibels here in the West.
In the Caribbean there is lots of work to do to get our financial and economic houses in order. Many small island economies have been severely affected by the global economic downturn. While there are signs of recovery flickering in the world’s leading economy, the United States, I think that the recovery on a global scale towards full prosperity and a robust economic future with investor confidence booming, is yet some way away. There is potential for the region to be further squeezed beyond current experiences.
So how will the Caribbean cope? While we should never abandon our ties to those Western nations who have helped us for so many years, I do think that diversification is paramount to the region’s economic survival. By this, I believe that we must point our compass east and set a course for better relations and interactions with China and India too, beyond those nations writing us hefty cheques.
If tourism still continues to be our main economic thrust, then we must look even more to improve our visibility to a vast and potentially lucrative Chinese market. I know Jamaica has already taken bold steps in this direction.
China Invest through up some very promising research numbers. They state that the Chinese outbound travel market grew by 20.4 % in 2010. Furthermore a study conducted by a Boston Consulting Group forecasts that this very same Chinese outbound travel market would value US$590 billion by 2020.
Dr Adam Wu, Chief Operating Officer of China Business Network delivered a feature address at the Caribbean Hotel and Tourism Investment Conference in Montego Bay, Jamaica in August of 2010. Wu said many things but the vital components of his speech which Caribbean governments must act on decisively, is his statement that “100 million Chinese will be traveling internationally by 2015, compared to 57 million in 2010….the Chinese tend to travel in groups and like to sightsee and visit multiple destinations. A typical Chinese tourist will spend up to US$6,000 per trip.”
I am aware that the Caribbean would be competing with other global destinations for these travelers, however, as we push our tourism product to global markets, diversification towards non traditional markets such as a potentially vast and expanding Chinese travel market will be strategic towards instilling further life into the region's tourism industry.
The Chinese are helping our economies to survive by the pumping billions into infrastructure development programmes, but we must not be complacent and expect this Chinese generosity to last indefinitely. We now have an avenue for closer cooperation with what was once considered a closed market. Visionary programmes must now be factored into national development plans to bring the Caribbean and China closer aligned.
Our school curriculums too should begin to reflect this new global dynamic and sensitise our children to the new world that is developing before us. It may not be such a bad idea to include basic Mandarin lessons so that our future trade negotiators, politicians and economists can converse even more intimately with those we seek to develop business relationships with.
As Dr Wu himself stated, ”Convey your message in Chinese. While 100 million middle-class Chinese families have the means to travel overseas, only ten million people, or 0.7 per cent of the population, can speak English.”
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