China sees the future in Africa (and it’s not alone)

Earlier this year, The Los Angeles Times ran a fascinating series on China and Africa and I only just got around to reading it.

I recommend at least reading Part I.

China is funding a massive railroad project connecting Addis Ababa, Ethiopia’s capital, to the port city of Djibouti where most of the country’s exports have previously traveled by way of roads in disrepair.

Clearly, China is not doing this for philanthropic reasons. It need resources. But China has a long game in mind as well — selling products to the locals (which is has been doing quite successfully for a number of years).

Some fascinating takeaways from the article:

By 2034, Africa is expected to have 1.1 billion workers, the world’s largest working-age population, according to economic forecasts. By 2025, the continent’s consumers will be spending $2 trillion a year.

And:

Zhang was proud of his Ethiopian investments. The new rail will knock shipping prices from $5,000 per container to $3,000, he said. And for the cost of one Chinese worker, Zhang can hire five Ethiopians. He plans to employ 50,000 within eight years.

“Ethiopia is like China was 40 years ago,” he said. “Even though this place is pretty tough, we think within five or 10 years, its economic development will be pretty good.”

China has not proven yet that it can build global brands. But it has proven itself adapt at building cheap white-label products. It sees in Africa an emerging base of middle-class consumers, a familiar growth pattern. That’s not to say China doesn’t face cultural and political challenges, but that as other Western countries have pulled back in Africa, China has found itself welcomed with open arms.

The CEOs of Google, Microsoft and Facebook have all visited Nigeria over the past year and have announced investments around training developers, supporting new businesses and increasing Internet penetration.

What The Google CEO’s Visit To Nigeria Means For Africa

So the question for any global company should be: What’s your Africa strategy? 

China: 120 million international travelers and just getting started

In 2016, more than 120 million Chinese traveled internationally. which is roughly the entire population of Japan (or Canada, Italy and Australia combined).

And only 10% of the country has a passport.

Imagine the travel industry when 25% of Chinese residents are traveling abroad. Where will they go? What will they want to see? To help shed light on these questions, Hotels.com recently interviewed 3,000 Chinese residents who traveled internationally over the past year.

It published these findings in the 2017 edition of the Chinese International Travel Monitor report. If you want to better understand Chinese travelers, where they’re headed and why, this report is a must read.

Here are a few items that jumped out at me:

  • China is already the largest source of international travelers for many countries.
  • Yet only 10% of the Chinese population had passports in 2016.
  • Shopping is no longer the prime attraction for a growing number of travelers
  • Nor is group travel, which is quickly losing favor among older travelers. Translation: Chinese travelers are tiring of those buses.
  • Independent travel is very popular among millennials.
  • And eco/green tours are becoming quite popular, particularly among older travelers. I’m very happy to see this.
  • The most welcoming countries to Chinese travelers, based on survey respondents, are Thailand, Japan, Australia. The USA made the top 5, though I suspect that ranking might be slipping based on current events.
  • The top landmark in the US:  Grand Canyon.
  • The top landmark in Australia: Great Barrier Reef.
  • And in France: the Louvre.
  • Chinese visitors spend more in the US than visitors from any other nation, approximately $7,200.

So what does this mean for hotels and other travel segments? It means you have be curious, nimble, and you had better support Chinese — both on your website, in your call center, via social media, and with in-house Mandarin speakers.  Survey respondents ranked poor hotel localization as a top 5 problem.

Chinese is also not as well supported across many of the global travel websites I reviewed two months ago. As shown here, based on our new report Destination: Marketing, Chinese is found on only 64% of the leading tourism websites.

Also, accepting Visa or Mastercard is not good enough. Most Chinese travelers prefer to pay with UnionPay.

Click here to download the report.

And if you’d like to know which tourism and destination websites are the most world-ready, check out our new report Destination: Marketing.

Finally, if you want insights into localizing your website for China, check out Think Outside the Country.