Fragmentation in China’s Public Administration andIts Impact on the Development of Tourism

HU WeiDistinguished Professor & Dean

School of International and Public AffairsShanghai Jiao Tong University

Marketization

Marketization as a great trend and orientation of China’s development in Post-Mao China, is currently both the context of China's public administration and the basic dynamics of its administrative development.

China GDP, 1978-2005

GDP ranking 2010 (million USD)

China—BOOMING Tourist Source

China's tourism has grown rapidly because of China’s marketization and economic development in the past 3 decades. China's membership in WTO as well as Beijing Olympic Games and World Expo 2010 have stimulated the country's booming tourism market.

China—A BOOMING Tourist Source

Tourism has become the industry with the greatest vitality in China’s economic development. According to some experts, China would be the world’s No.1 tourism destination and the fourth largest nation of tourists.

Marketization → Decentralization

Devolution

Deregulation

3Ds

Downsizing

Decentralization

China’s administrative reform has experienced decentralization and transformation of the administrative function in the past decades.

Fragmented Across Different Levels and Departments

Despite of the progress in China’s public administration since the Reform, it has been rather difficult for China’s government to implement its policies and regulations because public administration and policy are fragmented across different levels and departments of the government.

Fragmented Authoritarianism

A Dilemma:

Out of control at macro level

Over-control at micro level

Its Impact on China’s Tourism Administration

The 1The 1stst Impact Impact

A Dual System of Chinese tourism administration has been formed in 1978

China National Tourism Administration (CNTA) was set up at the beginning of the reform.

Tourism Administration at local levels were also created at the same time.

Western Economic RegionEastern Economic RegionCentral Economic Region

Major Tourism Province

CHINA

ECONOMIC REGIONS AND MAJOR TOURISM PROVINCES

Xinjiang

Xizang

Neimenggu

Qinghai

Gansu

Sichuan

Yunnan

Jilin

Heilongjiang

Hunan

Hebei

Hubei

Henan

Jiangxi

Anhui

Shanxi

Guizhou

Shandong

Chongqing

Ningxia

Taiwan

Hainan

Guangxi Guangxi

Fujian

Zhejiang

J iangsuShaanxi

LiaoningBeijing

Shanghai

Province

The 2The 2ndnd Impact: Impact:from Monopoly to Decentralization in tourism business operations

Before 1978: Three Magnates of Travel Services

•CITS, CTS, and CYTS

By 2009: 1460 international travel services

The market is highly fragmented with top 100 travel agencies controlling 50% of the market.

The 3rd ImpactThe 3rd Impact A Polycentric System of Chinese

macro tourism administration besides the China National Tourism Administration (CNTA) National Scenic Areas---Ministry of Construction National Forest Park---Ministry of Forestry National Nature Reserve---State Environmental Protection Administration National Geopark---Ministry of Land and Resources National Cultural Relics Preservation Unit---Ministry of Culture ……

Outcomes

Tourism administration and policy are fragmented across different departments of the government

Since current policies are fragmented across several government agencies with different policy mandates, better integration of policies and implementation efforts is required. For such a purpose, the administration system of tourism has been changed at some local level. Tourism Commissions have been established in Beijing, Guilin and Hangzhou in order to coordinate the relevant departments of tourism under leadership of a vice mayor.

Better Integration

Better integration will depend on the macro reform of China’s public administration system, such as the “Big Departments Reformation”.

Another basic way is to introduce more market forces into the bureaucracy.

---3Ds are still needed

Thank you!