Zero budget, zero benefit?

A big increase in visitors from China has sparked rising concern over zero budget tours, including their reliance on coercive sales techniques and unlicensed travel guides.


AS THE government moves to attract more visitors from Asian countries, concern is rising in the tourism industry about the number of Chinese tourists travelling to Myanmar on cheap package holidays known as “zero budget” or “zero dollar” tours.

The decision to grant visas-on-arrival to citizens of China, Japan and South Korea from October 1, in response to a decline in visitors from western countries over the Rakhine crisis, came as the number of Chinese visitors was already showing strong growth.

Ministry of Hotels and Tourism figures show that 198,256 Chinese visited the country from January to September, a 33 percent increase over the same period in 2017.

However, industry sources say most Chinese visitors travel on cheap, low-quality “zero budget” tours and are often coerced into buying over-priced gems, jewellery and other products during their stay in Myanmar.

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It’s common for the zero budget tour agencies to earn a commission from the shops in Yangon and Mandalay where the tourists are taken, say members of the Chinese Tour Guide Committee, a sub-group of the Myanmar Tour Guide Association with around 150 members.

Ko Soe Min, a Yangon-based guide who leads tours for Chinese visitors, said Chinese tourists come under intense pressure to buy at the shops because the tour agency wants the commission.

“If the Chinese tourists refuse to buy, the tour company won’t give them lunch,” said Soe Min, who is also a member of the Chinese Tour Guide Committee but was speaking in a personal capacity.

Chinese-speaking tour guides say that in China it’s possible to buy a six-day Yangon-Bagan-Ngwe Saung package tour – including a return airfare from Shenzhen, Guangzhou or Kunming to Yangon – for CNY1,899 (about K430,000 or US$273). A six-day Mandalay-Nay Pyi Taw-Bagan package costs about CNY1,199 (about K271,000 or $172). The guides said that most of the customers on these tours are Chinese in their 50s and 60s with a very limited budget. Most groups come on a charter flight.

Zero-budget travel is controversial because travel agencies and businesses in destination countries are often linked or owned by the same entity, which means much of the profit returns to China.

In an indication of the scale of the problem in Thailand, a crackdown there in October 2016 on zero budget tours from China resulted in legal action against 29 people and the seizure of 2,155 tour buses.

Among the businesses believed to be catering to Chinese zero-budget tour groups are the Yangon Gems and Jewellery Sales Center and adjoining Chinese restaurant in Hlaing Tharyar Township. The jewellery shop is exclusively for tourists from China and will not serve tourists from other countries or Myanmar people. Frontier was refused entry to the building by a security guard.

The building also has an office for Myanmar Land Sun International Travel Co, Ltd, which several sources told Frontier is one of the main companies promoting cheap tours of Myanmar to Chinese travellers. Directorate of Investment and Company Administration records show Myanmar Land Sun International Travel is a branch of an out-of-jurisdiction company and has two directors: Myint Toe and Jun Zhang. Its registered address is in Hlaing Tharyar’s FMI City.

Frontier could not find Myanmar Land Sun International Travel on a list of licensed inbound tour agencies on the Ministry of Hotels and Tourism website.

Other Yangon-based companies targeting Chinese tourists are Foremost Star Travels and Tours Co, Ltd, which is based in Tarmwe Township and a member of the Union of Myanmar Travel Association, and Myanmar Big Lion King International Travels and Tours Co, Ltd in Thingangyun Township. Both declined to talk to Frontier.

U Khin Zaw, an adviser to the minister of hotels and tourism, said the authorities should pay close attention to such businesses and ensure that they are open to tourists from all countries as well as Myanmar.

“If the authorities ask, they will say that they have a licence and they pay taxes,” Khin Zaw said. “But we don’t know if they are paying the correct amount of tax. They also sell at high prices. These shops need to be honest.”

Chinese-speaking tour guide Sai Soe Han, who is also a member of the Chinese Tour Guide Committee, said the tourism authorities need to move quickly against zero budget tours or they will damage the industry, as has occurred in Thailand and Vietnam.

“They [zero budget tours] bring only short-term benefits; the ministry needs to think about the long term,” he said.

Ministry of Hotels and Tourism spokesperson U Myo Win Nyunt said travel companies have been warned that they will be investigated if they sell package tours below what the ministry considers to be cost price.

“The ministry has also asked Chinese travel and tour companies not to offer zero budget tours,” he said.

At a meeting with Chinese tour companies and airlines in Yangon on October 30, Minister of Hotels and Tourism U Ohn Maung is reported to have requested that they do not offer cheap packages for travel to Myanmar.

Khin Zaw said Chinese tour agencies would be monitored for compliance and the ministry will take action if there are violations.

“If the companies continue offering price reductions, we will take action under the Tourist Law and seek the cancellation of licences,” said the ministerial adviser, who also urged aggrieved tourists to complain to the authorities. “If they don’t complain, we can’t take action against the companies.”

The Myanmar Tourism Federation says it is monitoring the impact of zero budget tours but is not overly concerned about the situation.

In fact, the federation appears to have encouraged zero budget tours; in October 2017, MTF chairman U Yan Win signed a memorandum of understanding with Mr Xie Hong of Myanmar Land Sun International Travel and Hubei Zhong Qing International Travel Service Co, Ltd, for the operation of charter flights for Chinese tourists in early 2018.

Yan Win claimed that the federation had often discussed with the ministry how to stop zero budget tours but stressed that the issue needed further consideration and careful study.

“I don’t believe zero budget tours will have the same negative impact as in Thailand and if they do we can always stop them,” he told Frontier.

But Chinese-speaking tour guides are angry at missing out of work because they say China-based travel companies are relying on Chinese nationals to guide zero budget groups.

Soe Han said Chinese tour guides have little knowledge of Myanmar and are providing incorrect information to Chinese travellers.

“The Chinese tour guides don’t know about our destinations and they could be damaging our country’s image,” he said.

To meet the requirement of having a licensed local guide with their group, the Chinese tour companies hire a cheap, inexperienced English-language guide, he said.

“They hire local guides just for show,” Soe Han said. “The Chinese travel and tour companies have no interest in doing what’s best for Myanmar, they just want the benefit themselves.”

In September, tour guides signed a petition complaining about foreigners doing their jobs and sent it to the Myanmar Tour Guides Association.

MTGA chairman U Aung Tun Lin said the association intended to send the petition to the ministry after it has gathered more evidence about foreigners working as tour guides so that legal action can be taken. The petition would include information about Chinese tour guides, he added.

It is an offence under the 2018 Myanmar Tourism Law to act as a tour guide without being licensed, but the maximum penalty for offenders is blacklisting.

Aung Tun Lin said a by-law was needed for cases involving foreign tour guides. “There is no section [in the Tourism Law] for taking action against foreign tour leaders.”

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