A dearth of Chinese travelers is nothing to “worry about,” said Banyan Tree Holdings founder Ho Kwon Ping.
“They are definitely going to come back,” he told CNBC’s Chery Kang at the Milken Institute’s Asia Summit on Wednesday.
“China is just a temporary blip,” he said. “Most of us in the hospitality industry, a year or so ago, predicted that Chinese tourism would only start to rebound around maybe this year or even next year.”
No one expected a quick turn-around from lockdown to mass travel, he added.
For Banyan Tree Holdings — which operates more than 60 hotels in 17 countries — Ho said “Chinese tourism [is] coming back quite strongly.”
What’s missing are the “mass group tours, which provide the numbers, but they don’t come to our hotels anyway,” he said.
“So you have a lot more free individual travelers … and they’re the ones who can pay the higher airfares and so on.”
He’s also bullish on the tourism market within China.
“The Chinese government made it very clear, they don’t want to have a heavy investment-led growth, they want consumption-based growth and consumption equals tourism. And tourism, as any economist will tell you, has got the greatest sort of trickle-on effect,” he said.
China’s property market
Ho also dismissed concerns about the turmoil surrounding China’s real estate market, which makes up about 30% of its economy.
“The banking system is not going to collapse because it’s Chinese banks that are lending money,” he said.
“So that’s why you see things like Country Garden … near to going bust, yet not going bust,” he said, referring to the Chinese property giant that narrowly missed a default.
In addition, “the percentage of the Chinese population that actually still lives in modern housing is not halfway near what it is in the Western world. So there’s a lot of demand still.”
As to his company’s exposure to a Chinese real estate bubble, he said: “We’re comfortable with a China real estate story, because we had a number of hotels in China which were all sold prior to the property bubble.”
Not just two superpowers
Ho said he believed Singapore, where his hospitality brand is headquartered, can help soothe geopolitical tensions that have escalated between China and the United States.
“I think Singapore can actually play a very important role in trying to make the U.S., the West in particular, understand that the rise of China is the rise of an entire civilization — and that it’s not a zero-sum game where they’re trying to rise to the extent of putting America and the West down.”
The Western psyche has been too absorbed by the Cold War, which was a zero-sum game, he said.
Even though the West has been dominant for the last 300 years, one global dominant power is not sustainable into perpetuity, he said.
“I think we’re going back to what I call ‘Back to the future’ — like in the movie, where the world 50 years from now will consist of various great civilizations,” he said.
“I use the word civilization because it’s not about economics. It’s not about military power, even politics [or] the idea of the only criteria by which you should judge a country’s politics is whether it practices liberal democracy … I think that’s all changing.”