Report on China’s Cruise Industry

At present, China is growing from a big tourism country to a powerful tourism country. China’s cruise tourism, motivated by both the government and the market, is striking toward a big cruise market with global influences. In 2016, cruise passengers reached 2.28 million in China, ranking the second in the global cruise market. Shanghai becomes the largest cruise terminal of the Asia-Pacific region, and the fourth largest around the world, of which the international status in the global cruise industry is greatly promoted, and the cruise industry is becoming a critical stimulation for regional economic transformation and upgrading. Today, China’s cruise industry is experiencing major transformations: market development from super-expected growth to steady growth, development orientation from quantity-focused to market structure transformation and upgrading, and product supply from the pattern of “demand stimulated by supply” of large and new ships to the pattern of “supply guided by demand”. The knowledge of market laws, the focus on product quality and the improvement in new product development have resulted in increased satisfaction of tourists. As the cruise industry actively integrates into “the Belt and Road” strategy, development driven by innovation is foreseeable, the key period for structural transformation and upgrading and the successful transition to the stage of steady growth. However, there are still wicked problems to be solved in the development of China’s cruise industry. Many bottlenecks are to be broken and innovations in development paths and patterns are needed. Upstream of the industry chain, the construction of home-made cruise ships still face the obstacles of complexities in technical research, lagged-behind supportive system and the lack of senior construction talents. In the midstream of the industry chain, the lack of diversity in cruise route design is still a stubborn problem; the domestic market is still dominated by foreign cruise operators; domestic cruise enterprises develop slowly with the lack of innovation for cruise products. Downstream of the industry chain, domestic cruise ports are still subject to poor profitability. Most cruise ports are poorly attractive to tourists, distribution channels of cruise products are restricted and the imbalance in the supply of and demand for cruise talents is still sharp. China is always believed to be the post promising cruise market. The solid social and economic development foundation, the arrival of the mass tourism era and the strong support for the cruise industry from government at all levels have brought along unprecedented opportunities to and promote steady and sustainable development of China’s cruise industry. A great era calls for great reform. In the background of comprehensive deepening reform of the state, China’s cruise industry will greet innovation and reform beyond imagination and continuously inject vitality to the cruise industry of the world.

Hot spots in China’s cruise tourism development during 2016–2017 include Cruise Industry Proactively Follows “the Belt and Road” Initiative and Develops a New Open and Cooperation Pattern for the Cruise Industry; China’s Cruise Market has Risen to the Second of the World and Wusongkou International Cruise Terminal has Joined the First Group; The First Industrial Fund for Cruise Industry is Founded and China Force Joins the Building of Luxury Cruise; Shanghai Takes the Lead to Innovate the Mode of Provisioning for Cruise Ships and Makes Great Effort to Build the Asia-Pacific Center for Global Cruise Ship Provisioning; New Voices Rise in International and Domestic Cruise Conferences and Forums, Exploring a New Chinese Model of International Cruise Industry; With Increasing Attraction of Chinese Cruise Market, Famous International Cruise Lines Compete to Capture the Chinese Market; Enhanced Industrial Policy and Research Support from National Ministries and Commissions Help Promote Stable and Further Development of Chinese Cruise Industry; Academic Research of Chinese Cruise Industry Finds a Brand-new Perspective, Exploring the New Rules of International Cruise Industry in Depth; Exploring the Chinese Path of Cruise Distribution Model under the Heated Debate on Cruise Distribution Model Innovation and Transformation; The Nanhai Cruises Opens up Xisha Islands Route, Setting off on a Path to off-shore Cruise Ship in China.

Cruise tourism is an important part of marine economy. With the rapid eastward-moving of the world cruise center, China has gradually become the center of the attention of the world’s cruise market. The deployment of “the Belt and Road” construction strategy brings a lot of new opportunities for the development of cruise industry. Chinese port cities also seize the opportunity to promote port development and accelerate the integration into the construction of 21st Century Maritime Silk Road. As an intersection of the 21st Century Maritime Silk Road and Yangtze River Economic Zone, Baoshan District has become the most important water gateway in Shanghai and the international passenger transport port as well as the location of the largest cruise home port in Asia. In the context of “the Belt and Road” initiative, this paper analyzes how Shanghai cruise industry connects with international cooperation and relevant policies with Shanghai cruise industry being object of study and port cities and the nation along “the Belt and Road” being spatial nodes, and discusses the future development path of Shanghai cruise tourism, in the hope of achieve the great-leap-forward development of Shanghai cruise economy.

China’s cruise industry experienced great changes during 2006–2016. From initial skepticism to current recognition, China has become an important cruise market in the world over the decade, with a bright future highly anticipated by global cruise lines. During the decade, improvements have been made in the cruise industry chain as well as port layout, continuously increasing the influence of the industry. Being the leader in China’s cruise industry, the Port of Shanghai has become the busiest port in China. And Wusongkou International Cruise Terminal has become the largest one in Asia and the fifth largest one in the world. With the cruise tourism market becoming mature, tourists begin to view cruise tourism from new perspectives, bringing in greater demands for cruise tourism. However, some bottlenecks and problems occur during the development of the industry. The Chinese market is dominated by foreign cruise ships. Domestic cruise ships are suffering slow development, with upstream and downstream segments of the cruise industry chain missed. This leads to limited economic contribution, an obvious lack of richness and diversity in cruise routes, slow cultivation of cruise tourism consumption culture in China and a big gap between the supply and the demand of talents in cruise tourism. In the future development, solutions are needed in port operation, policy innovation and talent cultivation to ensure the sound and rapid development of China’s cruise market.

The cruise industry is not only a high-growth industry but also a highly fluctuating industry. The Asian cruise economy plays a central and pivot role in the regional economy and even in the global cruise economy. The unhealthy development or a wide range of volatility of the Asian cruise economy will pose significant impact on the global cruise economy. Therefore, it is necessary and important to use a rigorous and scientific approach to analyze, evaluate and measure the climate state of Asian cruise economy. This paper defines the connotation of the climate of the cruise economy. Based on the subjective and objective methods in selecting the index, the Asian cruise business climate evaluation index system is constructed and the weight of the index is determined by the coefficient of variation method. Based on the synthetic index method, the Asian and Chinese cruise business climate is measured, and the Asian and Chinese cruise business climate index chart is drew to describe the Asian and Chinese cruise business reality and forecast its future development trend; the chart reflects the comprehensive ability for the sustainable development of Asia and China cruise economy in a certain period of time, laying a foundation for an accurate description of the cyclical fluctuations in Asian and Chinese cruise economy and improvement of the monitoring and alerting capacity of the cruise industry. In order to facilitate the extensive use of the cruise business climate index, this paper puts forward the mechanism of publishing the Asian cruise business climate index, including the establishment of the management mechanism of publishing the cruise business climate index, the development of the cruise industry statistical system, the establishment of the information collection system for cruise business climate index and the building of security mechanism for cruise business statistics.

With the transfer of international cruise industry from the markets of Europe and North America to Asia-Pacific Region, China has formed the second largest market of cruise tourist source in the world. The development of cruise industry in China owes much to the continuous efforts of the government sectors, business organizations and research institutions. The cruise industry in China has now entered the second decade of fast development. To adapt to such a rapid expansion, academic researches on cruise industry have reached an unprecedented peak in China in recent years. The research literature from 2006 to 2017 accounted for at least 97% of the total achievements, among which the academic achievements between 2013 and 2017 accounted for about 70%. In order to enable the practitioners and researchers to quickly get a thorough understanding on relevant achievements and priorities of research on the cruise industry in China, relevant research contents are collected and analyzed in this paper based on the literature in over ten years from 2006 to 2017. According to the analysis, it is found that the perspectives of academic researches on the cruise industry in China are mainly focused on macro analysis of the cruise industry, cruise regional development, cruise port competitiveness, route planning, cruise tourists, laws and regulations on the cruise industry, and environment safety and talent training, etc. On this basis, in this paper, prospects on research directions worthy of study in the future are made, so as to better facilitate the research and development of the cruise industry in China.

This study describes the evaluation theory for the economic contribution of cruise industry, discusses the characteristics of cruise economy, defines the temporal and spatial boundaries of such contribution, analyzes the production substitution effect and multiplier effect of cruise economy, and puts forward the data acquisition method for evaluation on the economic contribution of cruise industry to Shanghai and the method for evaluation on its direct and total contribution. The study, in combination with the characteristics and the trend of cruise economy development in Shanghai, finalizes the source structure of the economic contribution of cruise industry to Shanghai, proposes the data acquisition method for evaluation on such contribution and the method for evaluation on such contribution, and establishes an evaluation system for the economic contribution of cruise industry to Shanghai.

Cruise supporting industry is the important support for developing cruise economy. Cruise supporting industry in regions at home and abroad where cruise industry is developed enjoys features below: Cruise ship design and manufacturing experience is high; cruise lines are efficient in operation; cruise ship home ports have complete facilities; market foundation is profound; competition and transfer in ship supporting market is obvious; and port industrial transformation is highlighted. Global cruise market constantly increases and its center of gravity gradually moves eastwards. Shanghai, as key node city for two national strategic deployments, has vast increment in its cruise ship terminal development scale and gradually obvious agglomeration effect for cruise supporting industry development. In particular, Shanghai Wusongkou International Cruise Terminal has become the largest cruise ship home port in Asia, with ship berthing times and number of tourists ranking among the top in China; but it is challenged with shipbuilding structural adjustment, supply-side structural adjustment, industrial supporting factor integration and upgrading and industry chain breakage of cruise supporting industry. Therefore, Shanghai’s cruise industry, if wanting to improve competitive advantage, need accelerate its blending into value chain of global cruise industry and firmly seize national “the Belt and Road” strategic deployment and development opportunity for Experimental Zone for China (Shanghai) Cruise Tourism Development and building world’s famous tourism city in Shanghai; quicken optimization and upgrading of cruise supporting industry, focus on the industry’s institutional innovation, space layout and energy level improvement and determine implementation subjects and key measures.

China’s cruise industry has become one of the fastest growing points in the world, but there are still two outstanding problems: the cruise industry chain is not completed and it is in the low end of the global cruise value chain. China’s cruise financial service has shortcomings such as “fragmented system and insufficient depth and support efforts”, which restricts the development of the cruise industry and the upgrading of the value chain. In this paper, from the perspective of the financial supply side, “nine-grid pattern” of the cruise financial service system is made to analyze the status quo of China’s cruise financial service system. Drawing lessons from the United States, Europe, Asia-Pacific and other international experience, the “China model” and “new flying geese model” of Shanghai cruise economy were put forward, and policy finance, emerging finance, finance in the free trade zone of the cruise are the three breakthroughs.

Cruise industry, as a symbol of Western luxury culture, has been faced with legal coordination difficulties with Chinese characteristics in the course of its eastward development. The root cause lies in the natural hysteresis of the law itself, and in the differences in the legal sources between the law system of US and UK and the civil law system. In the course of Chinalization, cruise industry needs supply-side reform of laws to fit the characteristics of industrial agglomeration of the industry, so as to solve the legal dilemma of “shortage of law systems” and “difficulties in law enforcement” faced by cruise shipping, cruise tourism, cruise service, cruise logistics and other industries and establish integrated coping measures of legal approach for cruise industry on the basis of existing laws and regulations. Specifically, based on the Regulations on Operation of Cruise Tourism in Shanghai, to establish rules and regulations of the governments of cruise home ports, so as to define the dual attributes of transport and tourism of cruise ships, subdivide the agency modes of travel agencies and prevent implicit legal disputes over ship tickets; meanwhile, in accordance with the Law on Development and Planning of Cruise Industry in China, to make top-level design on overall planning, market operation and market support of cruise industry, so as to solve the problem of poor integration in the development of cruise industry.

With the fast development of China’s cruise tourism, both home port cruise and visiting port cruise are on the rise very quickly, which, however, leads to cruise ship pollution, which has attracted the attention of all parties. Due to the transnational features of cruise Lines, the international features of route operating and the global mobility of marine ecological system, the emission of cruise ship pollutants is provided with transnational and global features. With the enhancement of China’s comprehensive power, the change in international trend and the prominent global environmental problem, it is beneficial to the sustainable development of marine economy and marine ecological civilization construction to discuss the demand for the protection of marine rights and interests, ecological safety and resources development for the sustainable development of China’s cruise ship economy, analyze the environment supervision and treatment challenge caused by the mobile, complex, multilateral and transnational cruise ship pollution and explore China’s practice mode, implementation mechanism and realization path for international environmental governance of cruise tourism by introducing marine rights is and it plays a significant role in the green development of China’s cruise tourism.

With the eastward shift of the international cruise industry, Chinese-funded enterprises have gradually entered into the international cruise tourism industry, setting up Chinese cruise fleet, establishing international cruise brand and participating in the supply of new cruise products for the international cruise industry, which is very significant for promoting the establishment of the domestic cruise brands. However, Chinese cruise ship is now facing with many problems, for example, the competitiveness of single-ship operation is poor, the cruise tourism products are single, the drawbacks of the charter mode are increasingly prominent, the cruise industry chain is not perfect, the coastal tourism resources are not fully utilized, the South China Sea region has not been fully developed, the homogeneity of port operation is serious, and the port profitability is low. To promote the development of the domestic cruise brand, drive the construction of independent cruise ships with Chinese cultural elements, build the national cruise brand and achieve the great development and prosperity of China’s cruise industry, in this paper, the recent, medium and long-term three-step development strategy from the aspects of the layout of ports and overseas tourism destinations, cruise tourism, shipbuilding, operation and management are put forward, and the implementation focuses to promote the steady development of domestic cruise brand are highlighted.