China’s smaller cities may not get as much tourist
attention as Beijing or Shanghai, but when it comes to business travel they are
becoming more prominent. From Wuhan to Chongqing, Chengdu to Hangzhou, second
tier cities are emerging as hubs for both international and domestic
The statistics add up. By 2025, the Asian
nation will have 221 cities with more than a million residents. Currently there
are 160 cities in China with this figure, compared with only 35 in Europe,
according to management consultancy firm, McKinsey.
China also has the largest number of hotels
(by room count) in the pipeline. At 406,480 rooms, the country accounts for a
third of all global rooms under development, with more than 1,500 hotels
planned, many of which will be in secondary cities, reports Lodging Econometrics, a market
In addition, the country's corporate travel
spending is catching up with the US, and looks set to surpass it by 2014,
according to the US-based Global Business Travel
Association. A total of $245 billion will be spent on business travel in
China this year, compared to a predicted $267 billion in the US.
“As China opens up, more international
companies are strategically focusing on secondary cities for their development,”
said Paul Cunningham, general manager at the St Regis hotel in Tianjin.
Many of these smaller cities are becoming
hubs for fast growing industries such as electronics, pharmaceutical,
manufacturing and machinery. For example Chongqing in southwest China is now a
powerhouse for motorbikes, while Shenzhen in Guangdong Province an electronics
hub. Despite low incomes in rural areas, China's secondary cities are also a
magnet for global retailers such as Zara, H&M and Uniqlo.
“The central government has put a lot of
focus recently on building better infrastructure to those cities, including new
or upgraded airports, railway networks and highways,” said Philip Schaetz, senior
vice president of marketing at Dorsett
Hospitality International, a hotel operator in China.
And these destinations are being increasingly well serviced by direct flights
from overseas. Air China is launching a
Chengdu-Frankfurt service in May; Finnair
is opening a route from Helsinki to Xian in June; September will see a
Chengdu-London service from British Airways; while
China Eastern started flying
Nanjing to Sydney in December.
And the Kunming
Changshui International airport in the country’s southwestern Yunnan Province,
which opened in June 2012 and acts as a gateway to Vietnam and Laos, has been
earmarked by the government to become mainland China’s fourth largest airport
after Beijing, Shanghai-Pudong and Guangzhou.
There’s also been strong investment in
conference facilities. For example, the city government in Wuhan, the capital
of Hubei Province, has recently built a new exhibition hall. Reed Exhibitions, one of the world’s
largest conference organisers, will run 55 shows in the
2013 to 2014 season, in more than eight Chinese cities outside the traditional
hubs of Beijing and Shanghai, including Wuhan.
The most challenging aspect for these smaller
cities is human resources and finding international facing people to man the
hotels, airport terminals, taxis and conference halls.
“The labour market is very competitive with
so many hotels opening, “said Lo Young, regional vice president of the Langham Hospitality Group, a
global hotel operator. “To find the right people for the right jobs will
continue to be a big challenge.”