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Australian Travel Group Opens JV in Beijing

Flight Center Limited, the largest travel agency group in Australia, opened a joint venture in Beijing yesterday.

 

It is the first international joint venture that the Australian company has opened.

 

The joint venture, Flight Center Comfort Business Travel Service, was established with China Comfort Travel Co Ltd, the third-largest travel company in China.

 

The joint venture, with a registered capital of 18.08 million yuan (US$2.2 million), is 50 per cent owned by the two companies respectively.

 

Howard Stack, director of Flight Center, said China was a strategic link for his company's corporate and retail businesses worldwide.

 

"It is a burgeoning market that generates close to US$25 billion revenues a year," he said.

 

"International business travel spending in China is about US$4.2 billion, almost 20 per cent of the total Asian market, while domestic business travel spending is a massive US$20 billion," he said.

 

Stack said his company needs to partner with leaders in each vital region in order to create a world-leading brand.

 

Li Jilie, president of China Comfort, said this was a strategic partnership that would enable his company to provide a complete business travel service for companies in China and deliver an improved service for the existing clients with operations in the country.

 

"It will also enhance our ability to secure new global corporate travel accounts," he said.

 

Experts said the establishment of the joint venture suggests that international tourism giants have been showing increased interest in China's tourism market.

 

Guangdong China Travel Service (GCTS) and TUI China Travel Company Ltd signed a deal for complete cooperation in all aspects of tourism, including inbound, outbound, domestic and business tourism on April 26.

 

Based in Germany, TUI (Touristik Union International) is the largest tourism company in Europe.

 

TUI China Travel Company, established last year, is China's first Sino-foreign tourism joint venture controlled by foreign shares.

 

Besides TUI, other world tourism giants such as American Express, Japan Travel Bureau Group, and the UK-registered Business Travel International have also found, or are looking for cooperation with Chinese travel companies.

 

Wang Fude of the Academy of Tourism Development at the Beijing International Studies University, said the entry of foreign travel agencies would influence the restructuring of the Chinese tourism industry.

 

The major problem for Chinese tourism is its irrational structure, Wang said.

 

(China Daily August 4, 2004)

 

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