There’s More Than Meets the Eye to China’s Visa Exemptions

The addition of six countries to the country’s visa-free entry program last month is a boon to inbound tourism, which not only brings immense economic value, but also enhances China’s image

Two tourists take photos of the Great Wall of China in December 2019. Photo: VCG

On Nov. 24, China announced the trial expansion of its visa-free entry policy for ordinary passport holders to include six more countries: France, Germany, Italy, the Netherlands, Spain and Malaysia. This not only demonstrates a commitment to further opening up, but it is also a significant boon to China’s tourism market and broader economy.

But while visa exemptions are a good start, there is more that can be done. If further hassles for foreigners visiting China — such as payments and internet access — can be addressed, and tourism promotion strengthened, the number of visitors to China could increase substantially. This would not only bring considerable foreign exchange earnings and enhance China’s international image but also bolster the technological innovation and international competitiveness of the Chinese economy.

Economic value

Inbound tourism is often referred to as export tourism. China is the export. Thus, from an economic perspective, introducing visa-free entry is akin to encouraging exports by reducing barriers, which as a result boosts trade, increasing GDP and earning the country foreign exchange. Overall, there is tremendous economic value.

In recent years, domestic tourism has flourished and become a vital growth point for China’s economy. Inbound tourism has immense potential. China has traditionally attracted international tourism with its unique history, culture and natural scenery. But the country’s super-modern cities also appeal to travelers. During the Covid pandemic, I visited many of China’s tourist cities and found that transportation infrastructure like high-speed rail and highways, as well as tourist amenities like hotels, have reached world-class levels.

However, there are areas in inbound tourism that need improvement, such as image promotion, payment systems, internet access and visa processes. In recent years, even before the pandemic, the proportion of inbound tourism has continuously declined. In 2019, China’s foreign tourist revenue was $77 billion, just 0.5% of its GDP. In comparison, major countries worldwide have inbound tourism revenues accounting for more than 1% of their GDP: the United States at 1.05%, the United Kingdom at nearly 2%, Italy 2.38%, France 2.43%, Spain over 7%, and Thailand over 10%.

If China could reach the average level of other countries — 1.5% of GDP — this would amount to an additional 1 trillion yuan in tourism revenue annually. This figure only accounts for direct tourism revenue and does not include related additional income, such as related investments, revenue from international students and foreign real estate purchases. The comprehensive income could far exceed 1 trillion yuan. Moreover, these revenues are in foreign exchange, which can enhance the international competitiveness of the yuan.

Strategic value

The increase in inbound tourism is a sign of opening up to the outside world. Opening-up is a long-term national strategy. It can enhance the international competitiveness and innovation of Chinese companies, which is especially important against the backdrop of the U.S.’ attempts to block China’s access to advanced tech and curb technological innovation. Intensifying the effort to open up is an important strategy to counter the blockade, and attracting more foreigners to visit China is a key link in this strategy.

A tourist visits a photo exhibition called Chinese Family in Beijing in October 2019. The event marked the 70th anniversary of the founding of the People’s Republic of China. Photo: Jia Tianyong/China News Service, VCG　

In my book “Population Strategy,” I have detailed the importance of international exchange for technological innovation. The key to technological innovation is to enable unimpeded international exchange between Chinese researchers and researchers worldwide. This includes information exchange, commodity exchange, capital exchange, personnel exchange and other aspects.

China has done well in commodity exchange, already becoming the world’s largest trading nation. However, the exchange of information and personnel is still insufficient, and the latter is the deepest form of international exchange because many ideas for technological innovation are not only in academic literature or product documentation, but more importantly, in the minds of people. This flow of people provides irreplaceable in-depth exchanges between nations.

Historically, the centers of world innovation have been centers of personnel exchange. Over 2,000 years ago, places like Greece and Rome, and Xi’an during China’s Tang Dynasty, were metropolises open to foreigners. To take a more modern example, the success of American innovation owes much to the U.S. immigration and its recent policies that encourage bright minds to study in the country — many of the founders and chiefs of high-tech companies in the U.S. being foreign-born.

Many people get the idea to study abroad or immigrate while traveling. If one has a good experience in a country, they might consider studying, working, investing or immigrating there in the future. Therefore, tourism not only increases income but also has significant implications for technological innovation.

Tourism can also improve a country’s image on the world stage. China is often portrayed negatively in the West, as a threat, but foreigners’ prejudices are likely to fall by the wayside as more travel and experience what China has to offer.

Tourists visit the Bell Tower in Beijing in October 2019. Photo: VCG　

Next step

While I applaud the government for adding six more countries to the visa-free entry scheme on a one-year trial basis, I also greatly anticipate the introduction of further measures to eliminate other difficulties faced by foreign travelers. After all, increasing the number of inbound tourists involves more than just easing visa restrictions. It’s crucial to enhance the overall experience and convenience of foreigners living in China. For long-term development of inbound tourism, continuous efforts and improvements are needed in four key areas.

Firstly, visa convenience. The current visa exemption policy is a commendable attempt, but when comparing it to programs in other countries, there is room for improvement. Offering visa-free or e-visa facilities to more affluent nations should be considered. I realized this when I visited India a few years ago, where visas can be obtained online. Countries like Turkey, Vietnam and Australia are also providing e-visa services. Given China’s technological capabilities, it’s entirely feasible to offer e-visas to the majority of applicants.

Foreign passengers on their way to China from Germany check in at Brandenburg Airport in Berlin on Dec. 1. Photo: VCG　

Secondly, China needs to improve its international image. Negative perceptions abroad have made some foreigners feel that Chinese people are unfriendly and distant. This necessitates promoting the friendliness and inclusiveness of the Chinese people, who possess a unique cultural history and share with the world a “common destiny,” a modern Chinese concept. It’s important to explore common human values in areas like environmental protection, family and shared prosperity. Chinese companies with established brands and channels overseas could be utilized in this effort. Moreover, tourism is one of the most effective means of promoting a country’s image to foreigners.

Thirdly, the optimization of services like payments and internet access. With the prevalence of electronic payments in China, using cash has become inconvenient for foreigners. Relevant government agencies, tourism platforms and payment companies are actively seeking solutions. One of China’s major payment providers this year introduced more options for using international credit cards.

Another issue for tourists is internet access. Staying in touch with family and friends when overseas is important, but many websites and social media platforms popular with foreigners can only be accessed in China by using a virtual private network (VPN), which can be difficult to install and unreliable. International roaming is an expensive alternative. Chinese telecom authorities and companies can swiftly resolve this issue by reducing the cost of international roaming and the need for a VPN.

Lastly, the internationalization of education, health care and other necessities for foreigners, which facilitate longer stays, making it easier for foreigners to study, work and live in China. This calls for the enhancement of international service industries, such as by opening more international medical and educational institutions. This would elevate the international stature of Chinese cities, helping to attract more talent and drive investment in related industries.

In summary, inbound tourism can bring significant economic value, enhance China’s international image, boost technological innovation and improve international competitiveness. The decision to relax visa requirements for six more countries sends a strong positive signal. But to realize the full benefits of inbound tourism, China must continue to make obtaining visas more convenient. It should also bolster its international image, improve internet and mobile payment services, and enhance life services for foreigners.