China to US: Tourism Dips as Tariffs Increase
China and the United States are threatening each other with a trade war of tariffs and, now, tourism. This financial “Cold War” between the two largest world economies has been fueled by hostility from President Donald Trump which has been apparent since he took office in 2016.
The import taxes imposed by President Trump’s administration are intended to level the playing field with China.
US Commerce Secretary Wilbur Ross told CNBC, “the purpose of the tariffs is to modify China’s behavior” so that American companies can compete fairly. So far, the tariffs have affected $250 billion worth of China’s industrial items like steel and consumer products like purses. Beijing has responded with tariffs touching $110 billion worth of American products. The US government is reportedly planning to impose another round of tariffs on Chinese imports if the upcoming negotiations in November fail between the world leaders.
While the American government is encouraging its citizens to buy products made within the US, the restriction of commerce runs the risks of affecting more than the manufacturing industry, but also the tourism industry–an important influence that China has on the United States.
Chinese tourists spend an average of $6,900 while on vacation in the United States which contributes to the $60 billion that Chinese consumers spend annually on American services, according to the Washington Post. Coinciding with the financial friction, statistics from the US State Department already show a significant decline in visa applications–102,000 fewer Chinese people received business, leisure and educational visas from May through September of this year in comparison to the same period last year.
The declining tourism has also been seen in outbound plane ticket purchases within the last month based on information from online travel website Skyscanner, owned by China’s largest travel company, Ctrip.
The continuation of this trend could have unpredictably costly effects for the United States.
The dip in US tourism and trade provides an opportunity for the UK to grow its relationships with China. Britain’s Secretary of State for Foreign Affairs, Jeremy Hunt, said Chinese State Councillor, Wang Yi, made an offer “to open discussions about a possible free trade deal done between Britain and China post Brexit”.
The uncertain future of relations between China and the United States may open opportunities for the UK, however, in an interview with Fox News, Donald Trump predicts that he will be able to make a great deal with China because “they’ve drained our country.”