UNIVERSITY OF LJUBLJANA FACULTY OF ECONOMICS AND INTERNATIONAL CENTER FOR PROMOTION OF ENTERPRISES (ICPE), LJUBLJANA MASTER’S THESIS THE IMPACT OF 2008 BEIJING OLYMPIC GAMES ON CHINESE TOURISM – THE MODEL FOR MEASUREMENT Ljubljana, September 2008 Hao Chen Author's Statement I, Hao Chen hereby certify to be the author of this Master's thesis, that was written under mentorship of Dr. Tanja Mihalič and in compliance with the Act of Authors' and Related Rights- Para.1, Article 21. I herewith agree this thesis to be published on the website pages of ICPE and the Faculty of Economics. Ljubljana, Date: Sep 3, 2008 Signature.................................... Acknowledgement I am very grateful to my mentor Prof. Dr. Tanja Mihalič, Faculty of Economics, University of Ljubljana, for her guidance, suggestions and support. I am thankful to all my MBA classmates for creating a nice environment for learning and enjoyment. Special thanks goes to Mr. Aswin Shrestha, our programme director and the entire staff of ICPE for their kindness and support. At the end, I want to thank my family who supported me throughout my study. TABLE OF CONTENTS LIST OF TABLES ............................................................................................................. i LIST OF FIGURES .........................................................................................................iii ABBREVIATIONS.......................................................................................................... iv Chapter 1 − INTRODUCTION ....................................................................................... 1 1.1 Introduction and research problems .......................................................................... 1 1.2 Research purpose and objectives............................................................................... 3 1.3 Structure .................................................................................................................... 4 1.4 Research methodology .............................................................................................. 5 1.5 Literature Review...................................................................................................... 6 Chapter 2 – OLYMPIC GAMES AND TOURISM....................................................... 9 2.1 Defining Olympic Games.......................................................................................... 9 2.2 Defining Tourism system and environments .......................................................... 12 2.3 Mega event and tourism .......................................................................................... 13 Chapter 3 – OLYMPIC GAMES IMPACT ON TOURISM IN THE PREVIOUS HOST CITIES................................................................................................................. 16 3.1 Athens Olympic Games (2004)............................................................................... 16 3.2 Sydney Olympic Games (2000) .............................................................................. 19 3.3 Reviews of impacts of some other Olympic Games ............................................... 22 3.3.1 Atlanta Olympics (1996)................................................................................... 23 3.3.2 Barcelona Games (1992).................................................................................. 23 3.3.3 Seoul Olympics Games(1988) .......................................................................... 24 3.3.4 Los Angeles Olympic Games (1984) ................................................................ 25 3.4 Case study - the model for measurement used for prediction................................. 26 3.5 Summarizing the key impacts ................................................................................. 30 3.5.1 Tourism supply ................................................................................................. 30 3.5.2 Tourism demand ............................................................................................... 31 3.5.3 Tourism environments ...................................................................................... 32 Chapter 4 – TOURISM DEVELOPMENT IN CHINA AND BEIJING................... 34 4.1 Development of Chinese tourism............................................................................ 34 4.1.1 History of the development of Chinese tourism................................................ 34 4.1.2 The future development of Chinese tourism industry ....................................... 39 4.2 Tourism Development in Beijing............................................................................ 40 Chapter 5 – BEIJING OLYMPIC GAMES................................................................. 43 5.1 Organization of the Beijing Olympic Games.......................................................... 43 5.2 Plans for leveraging the Games and expectations................................................... 47 Chapter 6 – IMPACTS OF THE BEIJING OLYMPIC GAMES ON TOURISM .. 49 6.1 General description of the model ............................................................................ 49 6.2 Impacts on the demand side .................................................................................... 52 6.2.1 Behaviour patterns of tourists ......................................................................... 52 6.2.2. Number of domestic and international tourists and their expenditure............ 54 6.3 Impacts on the supply side ...................................................................................... 60 6.3.1 Impacts on travel agencies ............................................................................... 61 6.3.2 Impacts on accomodation and catering........................................................... 62 6.3.3 Impacts on public transportation infrastructure .............................................. 65 6.3.4 Impact on structure of tourism supply.............................................................. 66 6.3.5 Impact on structure of tourism industry ........................................................... 68 6.3.6 Impacts on tourism information services.......................................................... 68 6.3.7 Impacts on image of Beijing and China ........................................................... 68 6.4 Impacts on environments side................................................................................. 69 6.4.1 Economic environment ..................................................................................... 69 6.4.2 Socio-political environment.............................................................................. 70 6.4.3 Ecological environment.................................................................................... 71 Chapter 7 – EVALUATION OF THE MODEL .......................................................... 78 7.1 Obtaining the data ................................................................................................... 78 7.2 Evaluation................................................................................................................ 79 Chapter 8– CONCLUSION ........................................................................................... 84 Bibliography .................................................................................................................... 86 Sources ............................................................................................................................. 90 LIST OF TABLES Table 1: The number of events, participants and media personnel for the last three Olympic Games...................................................................................................11 Table 2: Phases of organization of Olympic Games with costs and benefits....................12 Table 3: Tourism development in China for years 2001 – 2006.......................................38 Table 4: Number of international and domestic tourists and earnings from them during the period 2001 – 2006........................................................................................41 Table 5: The average occupancy rate and average price per day during the Olympic Games..................................................................................................................63 Table 6: Numbers of domestic and foreign tourists daily accepted to star-rated hotels and numbers of domestic and foreign tourists visiting major tourist attractions 64 Table 7: Indicators for star-rated hotels in first 7 months of 2008....................................64 Table 8: Major macroeconomic indicators of Beijing and China .....................................70 Table 9: Green areas in Beijing.........................................................................................74 i ii LIST OF FIGURES Figure 1: A model of a short-term impact of a hallmark event .................................................14 Figure 2: A model of an impact of a hallmark event that builds a basis for faster development of tourism ...........................................................................................................................15 Figure 3: Visitor arrivals to Greece, Croatia and Turkey from 2001 to 2007 ...........................19 Figure 4: International visitor arrivals in Australia and New Zealand......................................22 Figure 5: Number of foreign visitors to Korea in years before and after