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Sail-World.com : ASIA: the promise of boating bounty

ASIA: the promise of boating bounty

'Hong Kong’s expansive Victoria Harbour is the busiest, but not the only waterway in the region.'    MIAA    Click Here to view large photo

China may not be the golden goose the boating world had predicted, and those on the ground say it is unlikely to mature for more than a decade, but there is a growing appetite for luxury consumer goods as China becomes more affluent, and boats are inching their way on to the wish list of the affluent.

The trouble with boats is that unlike consumer goods that shamelessly display wealth – designer clothes, cars, golf and art – the marine lifestyle requires marinas, skills, maintenance and fuel.

Predictions have been made of every 10,000 people, 5.5 will have their own boat. However others see this as too ambitious, given the fact that boating and water sports have never been a strong part of the Chinese culture.

The private leisure boating sector remains in its infancy in China, with only 1,000 boats and 5-6 high profile international marinas but with potential for exponential growth. Dozens of large scale marina development are planned at provincial government level and numerous small private marinas.

But it is definitely a matter of believe it when you see it. Approval of marinas requires endless red tape and bureaucratic procedures and the Chinese military and government place many different levels of restrictions on coastal developments, as well as reams of paperwork for those choosing to cruise the region’s waterways.

Several marinas have been built for the Beijing Olympic Games to cater for the watersports and sailing activities, and a luxury marina complex is planned for Shanghai in time for the city to host World Expo 2010.

Hong Kong is looking more promising, as are other regions in Asia – Thailand and Vietnam – and at just a few hours cruise from China, Hong Kong is currently the home of choice for Chinese boat owners until the local infrastructure emerges.

There are about 13 marina clubs and 8,000 registered pleasure boats in Hong Kong. According to reports from China, about 14 marina clubs are being planned along the coastal cities in China, which will be completed in the next two to three years.

Key marine export opportunities to Hong Kong include:
• 20-30 foot speed boat is most popular in Hong Kong and is targeted at the youth market
• 40-50 foot pleasure boat for family weekend use
• 80 foot pleasure boat, targeted at the top end of the market
• Below 10 foot dinghy
• Speed boat accessories, radar equipment, etc.
Source: Austrade

China: Facts & Stats

Population: 1.36 billion and climbing. It is expected to reach 1.5 billion by 2040.

Economy: Towards the end of the 1970s the Chinese leadership began moving its country’s economy from an inefficient Soviet-style centrally planned economy to a more market-oriented system. And slowly but surely the economy is being opened up to foreign trade and investment. It is now less command economy than semi-capitalist juggernaut. The result has been a quadrupling of GDP since 1978. During 2004 China’s GDP grew by a colossal 9.5 per cent and this year it is expect to do a similar 9.0 per cent plus.

Boating Geography: The world’s fourth-largest country after Russia, Canada and the US, China’s fairly fragmented coastline extends 14,500km from its border with Vietnam in the southwest up to North Korea and Russia to the northeast. It takes in the Yellow, East China and South China Seas. And there are also hundreds of thousands of kilometres of rivers, lakes and reservoirs. The total land mass that is China covers some 9.6 million km² and the area of water under Chinese control adds up to 270,000km².

In all there are 23 Chinese provinces, the 23rd of which is considered to be Taiwan, five autonomous regions and four municipalities. Plus there are the Special Administrative Regions or ‘SARs’ of Hong Kong and Macau, which still maintain border crossings and require visas, for Chinese nationals going into Hong Kong and for Hong Kong residents to travel into China. Hong Kong and the gambling enclave that is Macau are viewed as playgrounds.

Obstacles: Virtually no marinas. Considerable bureaucracy. Registration. The buyer of an imported boat would pay 17 per cent tax and 10 per cent duty.

Key Boat Shows: China International Boat Show in Shanghai, held annually in early April. Normally attracts 230 exhibitors and 16,000-plus visitors. The Gold Coast Boat Show, Hong Kong, now in its 12th year, is held every May, boasting HK$1 billion dollars worth of high-end vessels on display.

To coincide with the region’s high season and best weather, the China Coast Regatta is held each October, as are the China Cup, the Hong Kong to Vietnam Race and the Hong Kong to Hainan race. In November, there’s the Around the Island Race.

Market Outlook: Most informed opinion estimates that it will take three-five years before any serious activity begins and some less optimistic suggest it may take a lot longer than that for the Chinese to associate leisure with boats.

For that to happen not only must the country develop an infrastructure from scratch, but also culture habits need to be modified to suit the outdoor, boating lifestyle.

On the upside: Marine equipment manufacturing and boatbuilding activity are strong. There are now hundreds of Chinese companies producing all sorts of marine leisure products and probably as many companies building boats. With labour rates in China at least a tenth of what they would be in Europe, the US and Australia, and the quality improving all the time, activity is likely to increase.

According to Simpson Marine, Asia's leading dealer, based in Hong Kong but with offices in Singapore, East and West Malaysia, Thailand, Taiwan and China, representing high end brands including Azimut, Benetti, SeaRay, Beneteau and Lagoon, the appeal of the European lifestyle is gradually growing.

'There is a lot of room for growth in all the markets, especially in China where the boating industry has only just started,' says the company’s marketing manager, Ailsa Angus.

'The Singapore market is also increasing rapidly. The growth of the industry is in all segments throughout the region as the industry is not limited to the high tier groups.'

Boating in China is a completely different concept from Hong Kong. As Ailsa explains: 'Chinese people do not understand water-sports and are only starting to get into the market.

'If a person buys a luxury yacht at this stage it is highly likely that they would invite their friends to join them for the day and not actually leave the Marina.

'Wealthy Chinese are not interested in driving their own yacht and at this stage it is purely a status symbol to their friends. China has a high tax on imported boats and you still cannot move from one province to another without Government approval.

'Hong Kong is a well developed market with many enjoying water sports including water skiing, wakeboarding, boating. Weekend junk trips are hugely popular as Hong Kong has many locations that people can go to.'

Hong Kong residents place more emphasis on watersports, the outdoor lifestyle and boating. -  MIAA   Click Here to view large photo

Despite the hype of the booming casino industry in Macau, just a ferry trip from Hong Kong, there is no substantial marina and cruising the waters is fraught with problems.

'There is only one very small Marina in Macau. Unfortunately the sailing area around Macau is very limited and Immigration would need to be cleared each time a yacht left the Marina, as all surrounding Islands are in Chinese waters,' reports Ailsa.

Elsewhere in Asia, Indonesia is expanding and proving a growth market for boat sales.

'Indonesia is very good in terms of sales and we believe China will be hugely profitable within the next five years.'

Indonesia is blessed with a number of harbours, ports and plenty of beaches. Kayaking, whitewater rafting, canoeing, boat trips and diving are all popular local and tourist pursuits.

More at www.austrade.gov.au and www.simpsonmarine.com

by Jeni Bone


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4:42 AM Tue 24 Jun 2008 GMT

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