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Beijing's Tourism Sector Slumping
Beijing's embattled tourism industry will lose around 40 billion yuan (US$4.8 billion) this year due to the deadly SARS virus, economic experts predicted Friday.

They described the severe acute respiratory syndrome (SARS) crisis as perhaps the most dramatic prolonged shutdown of the travel industry on record since 1989.

According to a report by the China Centre for Economic Research (CCER) affiliated to Peking University, Beijing's tourism revenue from overseas visitors this year will slump by 60 to 70 percent compared with last year, while income from domestic visitors will fall by around 30 percent.

Travel demand was almost flat during the May Day holiday this year.

It followed the decision by the government to cut the week-long holiday to five days and restrict mass population movements across regions. It prevented the capital from matching the 3.4 billion yuan (US$411 million) it made in revenue last year.

According to statistics from the Beijing Tourism Bureau, the city only hosted 190,000 tourists during the shortened May Day holiday - a slump of 95.5 percent. Income was 25 million yuan (US$3 million), declining 99.1 percent compared with the same period last year.

Slumping business forced 143 of the 167 tourist spots in Beijing's outskirts to close down, according to the bureau.

With China being hit by travel advisories from the World Health Organization, more than 150,000 foreign tourists cancelled their bookings with travel agencies in Beijing.

Overseas arrivals were down by around 78 percent in April from the same month in 2002, and most foreign tour groups cut their travel schedules to the capital between May and September, according to the Beijing Statistics Bureau.

Few domestic people chose Beijing as their travel destination as nearly half of SARS cases nationally were reported in the capital.

Experts say it will take time for the travel industry to recover as it is very seasonal and people only rebuild their confidence in travel security after a long period of time.

Prior to the SARS outbreak, the city's tourism bureau was projecting 5 to 6 percent growth in visitor arrivals this year.

The city was targeting US$3.3 billion in tourist income from overseas visitors this year and 97 billion yuan (US$12 billion) from domestic travelers.

The hotel sector has also been crippled by the SARS outbreak.

According to the tourism bureau, room occupancy of hotels with more than three stars in Beijing is only 7 percent on average. The rate was around 65 percent in previous years.

In response to the costly adverse impact brought by SARS, the municipal government has offered interest-free short-term loans for companies in the tourism and hotel sectors.

Taxes and administrative fees levied by the government have been waived or reduced between May 1 to September 30.

(China Daily May 24, 2003)

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