UK welcome mat for Chinese tourists
The simplification of the visa process for Chinese visitors to the United Kingdom could cause spending by this consumer group in London to go up by 141 percent, to 500 million pounds ($833 million) a year by 2020, a report said Thursday.
Total overseas spending in the British capital is expected to expand by 47 percent in the same period, saidMarie Hickey, associate director of research at Savills, an international real estate adviser, in the report.
“The Chinese are now the biggest spending travelers globally, and with initiatives in place to make visiting the UK easier, the retail sector should see a positive impact over the forthcoming years, with London set to benefit the most,” Hickey said.
TheUKplans to make it easier for Chinese nationals to apply for visas to visit the country, UK Chancellor of the Exchequer George Osborne announced last October while visiting China.
Expected larger numbers of Chinese visitors should increase the demand for new entrants into CentralLondon, with retailers hoping to test the waters before entering Asian markets, report.
Fifty-five international brands opened their first UK stores in London in the past three years.
“London’s rising prominence as a global retail destination means that we expect occupational demand to intensify, putting upward pressure on rents on all key pitches in theWest End, particularly on the luxury pitches,” said Anthony Selwyn, head of Central London retail, Savills.
“Over the next 18 months, we expect Bond Street’s prime Zone A rents to exceed 1,500 pounds per square foot — up 15 percent from where they are now— with Brompton Road likely to see the greatest uplift in the region with 20 percent.”
Chinese shoppers have become the biggest consumers of luxury goods in the world, accounting for 29 percent of global consumption, said James Macdonald, head of research for Savills in China, citing figures from Bain & Co.
However, China’s retail stores account for only 7 percent of the sales, with only one-third of purchases by Chinese taking place on the Chinese mainland.
Another one-third takes place in Hong Kong, Taiwan andMacao, and the remainder is in other countries.
The reasons include the relative strength of the renminbi, the lower price point of goods and broader product range in overseas markets, and increased travels. “These factors are likely to remain for the foreseeable future, driving consumption in overseas markets by Chinese shoppers,” Macdonald said.
A record 291,919 visas were issued to Chinese visitors last year, up 39 percent year-on-year, according to a statement on the website of the UK government in February, citing the Office of National Statistics.
“The UK saw a larger rise in visit visas from China than from anywhere else in the world during 2013. And despite the significant increase in demand, the UK processed visas in an average of 7.2 days. Of those who applied across all visa categories, on average, 96 percent were successful,” said the statement.
“The increase demonstrates that the new UK Visas & Immigration Service’s commitment to customer service is having an effect.”
British Ambassador to China Sebastian Wood described the statistics as both striking and encouraging, adding that the visa system is supporting the growth of the UK’s economic, educational and tourism relationship with China.
Chinese tourists shop at Harrods department store in London. Chinese shoppers have become the biggest consumers of luxury goods in the world, accounting for 29 percent of global consumption.