It seems simple enough. As
their wallets start to bulge more and more, the 1.3 billion
Chinese need a place
to go for entertainment a theme park.
That goes some way to explaining the current investment
craze in hundreds of themed
amusement parks across the
country.
According to the International Association of Amusement
Parks and
Attractions (IAAPA), a new wave of investments in
China‘s theme parks is on the way, as the following five
years are expected to be rosy for China‘s amusement parks
and attractions industry.
There are now at least 2,000 theme parks in China,
although the industry only started about 20 years ago. Most
such parks were co-invested by the government and private
sectors and were built up in economically developed regions
such as Beijing, Tianjin, the Yangtze River Delta and the
Pearl River Delta.
Domestic investors are planning a number of new parks
in the country. For example, the historic town of
Zhouzhuang on the outskirts of Shanghai is planning a US$40-
million park with 5,000 years of Chinese culture as its
theme. Construction is scheduled to begin at the end of
2006 and is expected to take at least one year.
Meanwhile, the central government has mapped out a plan
to spend heavily in the Shenzhen area to improve the
existing parks so that they complement nearby Hong Kong
Disneyland. The government hopes to market the region as a
destination called the "Golden Coast," which would feature
hotels and activities to keep visitors entertained for
several days.
Foreign investors are also vying to inject billions of
dollars into building up new theme parks across the country.
A joint venture between Shenzhen Sanguo Culture City
Industrial Development Co Ltd and Canada-based Bedford
International Financial Group is planning a US$3-billion
park called China Today on Shenzhen‘s eastern shore, to be
based on the legend of the third-century Three Kingdoms.
The park is expected to open in 2010.
US-based Walt Disney is negotiating with Shanghai‘s
municipal government to build a theme park in the city‘s
Nanhui District, to open in 2010, coinciding with the
city‘s World Expo 2010. Shanghai‘s Jinjiang Park is also
talking with US company Triple Five about a project to
expand and reinvent the park, according to IAAPA officials.
At the opening of the IAAPA Asian Expo 2006 held in
Shanghai recently, IAAPA President and Chief Executive
Officer Charlie Bray said the "explosive" development of
China‘s theme parks has seen the country emerge as a
driver for the Asia-Pacific region, which is set to enjoy
the fastest growth of this industry in the coming five to
10 years.
"The Asia-Pacific is clearly an emerging market for the
amusement park and attractions industry. I think the future
growth of the region will largely depend on China and
India," he said.
According to a PricewaterhouseCoopers report, "Global
Entertainment and Media Outlook," revenue generated from
theme parks on mainland China is expected to grow 7.1
percent annually to reach US$1.8 billion in 2010, up from
US$1.3 billion last year.
The performance in Hong Kong is even better, with the
opening of Disneyland Hong Kong in 2005 and the
redevelopment of its Ocean Park. It expects an annual
growth of 21.8 percent to reach US$362 million in 2010 from
US$135 million in 2005.
Meanwhile, the Asia-Pacific region is expected to
generate an average annual revenue growth of 5.9 percent to
reach a total income of US$8.2 billion by 2010.
Attendance at Asia‘s theme parks is expected to hit
278 million in 2010, up from 234 million last year,
equalling an increase of 18.8 percent.
However, the report also pointed out that investments
in many theme parks in the country are not successful. The
poor performance of these parks was attributed to a lack of
major reinvestments.
According to Liu Jingwang, deputy executive president
of the China Association of Amusement Parks and
Attractions, China‘s amusement parks and attractions
industry is already plagued by repetitive investments from
local governments.
"If you go to any medium-sized and large-sized cities,
you will find a theme park that is built up or under
construction. I am kind of worried what do we do with so
many amusement parks?"
Local governments should therefore carefully evaluate
the market and control the scale of investment to avoid
huge losses incurred by insufficient demand, he said.
(China Daily July 25, 2006).