The United Kingdom has an enormous shop window sign addressed to China: “NihouMa. Open for business. We welcome your custom and money.”
In small print underneath the sign is a stinging caveat: “Does not apply to tourists, students and sundry others like small businesses and entrepreneurs. Wait in line or go elsewhere”.
This is a metaphorical allusion, of course. No such sign exists as far as I know but it might just as well. On the one hand the present British coalition government is tripping over itself to attract Chinese inward investment for infrastructure projects as well as make London a financial centre to facilitate the yuan’s progressive internationalisation, while on the other, it is doing its best to deter other forms of China-sourced income, specifically money which could flow from tourists and students into the U.K. government exchequer.
The U.K’s visa regime for permitting border entry to Chinese nationals is contradictory, if not patently absurd. The Economist recently called it ‘Britain’s barmiest policy.’ That applies as much to the draconian rules and application procedures tourists and students have to endure as the underlying rationale of security and ‘net migration’ (immigration minus emigration) that purportedly justifies the barmy policy.
Let’s take Chinese tourists, perhaps the world’s most inveterate shopaholics, who should be bringing in lots of foreign exchange by consuming U.K-based branded goods and services. Only 142,000 Chinese tourists turned up In Britain last year.
Yet globally, these travellers represent 20 per cent of all duty free shopping worldwide. Though the few who do manage to get through the U.K’s border security aren’t the biggest high-rollers in the country (Gulf state nationals are) the average Chinese tourist spends €2,013 on a visit to Britain, three times more than most other international tourists. Other surveys suggest the average Chinese tourist per item transaction in London is €1,282. Obviously the Chinese are buying quite expensive stuff, not your average run-of-the-mill tat and cheap gewgaws from Poundland.
Figures tend to vary about the amounts they actually spend, but there is no doubting that Chinese tourists commit to high personal expenditure when on holiday. Nor is the increasing net disposable income of China’s fast-expanding middle classes (forecast to be a mere 1.4 billion by 2030) or their growing penchant for overseas travel the kind of numbers to be ignored. It is estimated that by 2015 over 100 million Chinese will be travelling abroad. This is a burst of future value, waiting to be harvested. Yet whereas the U.K. should be positioning itself as an inviting place to visit for existing and future Chinese tourists, it seems to be doing its best to spurn them. To use a well-known English proverb, the U.K. seems to be cutting off its nose to spite its face.
This is where U.K. visa policy resembles the classic indecision of a Buridan ass , a philosophical dilemma named after a 14th century French philosopher. The ass is both hungry and thirsty but as it stands halfway between a pile of hay and a trough of water it cannot decide which of its needs to satisfy first. So it doesn’t move. Eventually the poor ass dies of hunger and thirst. The Buridan ass is alive and hesitating in the U.K’s visa policy. One wing of the UK government wants the Chinese to turn up in droves and spend lavishly, another (led by the Home Office) would much prefer to have fewer of them and so, as a deterrent, it makes the application process onerous, expensive and impractical.
The result is a trickle of tourists when compared to the tidal wave that washes over France’s more inviting shores. Contrast the 142,000 Chinese visitors to the U.K in 2011 against the estimated 1.2 million (some figures say 900,000) entering France the same year.
The fact that the U.K has opted-out of the Schengen agreement which allows one-time visa entry for non-EU citizens to 26 European countries, doesn’t help the country bring in Chinese tourists. Why should they not decide to visit Paris and Berlin instead of London if it means less hassle for them getting a U.K. visitor’s visa ? Well, for a start, Britain’s unique history, traditions, culture and brands make the U.K. an attractive destination option – if only the Chinese could get there without the fussy red-tape.
Eighty per cent of Chinese visiting Europe obtain a Schengen visa enabling travel across continental Europe. But a Schengen visa doesn’t allow entry to the U.K. Consequently only 11 per cent of Chinese visitors get a UK visa, and a measly seven per cent get both. The maths is driven by a political ‘small island’ mentality that is detrimental to the coffers of the U.K Treasury. Tourism is the third largest foreign exchange earner in the U.K. representing nine percent of its GDP and jobs.
Relaxing tight entry restrictions on Chinese tourists is a no-brainer, except for a Buridan ass. While the government Home Office minister resists pressure to relax the visa rules, other government offices such as the Chancellor of the Exchequer and (the now ex-) culture minister are doing their utmost to lighten them. Visit Britain, the quasi-official tourist board, has been given a government budget of £8 million to treble the inflow of Chinese tourists by 2015. It is a paltry budget but money nonetheless, and hard to come by under an austerity government. The target is just over 400,000 from today’s visitors, roughly 0.4% of the total number of Chinese forecast to be going overseas in that year. It’s a start, but one that will go nowhere for as long as the Home Office remains as stubborn as an ass.
Then there is the question of Chinese students coming to take up the U.K’s undoubted quality of tertiary and higher education. Their invitation is again impacted by a ‘net immigration’ policy that looks strictly at numbers but not their value to the U.K. economy, a policy driven largely by a political agenda (one which tries to capitalise on U.K. voter sentiments about immigrants). The policy isn’t a result of post-9/11 or 7/7 paranoia. It is the ugly love-child of erroneous technocrat reasoning mated with the political goal of reducing immigration figures to satisfy an electorate that in any case, isn’t hostile to overseas students. Caught in this undiscriminating net is a very valuable cohort of young overseas students from China.
Higher education is a major export industry of the U.K, earning £2.5 billion a year in fees. Due to the U.K’s new visa regulations which confront Chinese students with tough questions and little prospect of gaining entry, fewer of them are applying for British university places.
It is a well-known fact that culturally Chinese families see their youth as a future investment, a kind of old-age pension policy. Sending them to foreign universities to earn a good degree is a premium that affords security for their future. Parents will shell out big money to get a return on their policy assurance. And China has the world’s largest pool of potential overseas HE students, many of whom want to avoid the dreaded knowledge regimentation of a gaokao by going to pre-university high schools in Europe. In 2011 there were 340,000 of them choosing for higher education in foreign lands.
But the Buridan ass which has taken up residence in London’s Westminster is making it harder for Chinese nationals to occupy places at British universities. The ass’s ‘net migration’ figure makes no distinction between temporary and permanent migration. All migrants who stay for more than a year show up in the long-term migration statistics yet we know a student has to typically commit to three years if they’re to complete a higher education degree. Shamefully the ass is neighing: ‘ee-aaw, close the door’.
The U.K. seems to have forgotten that apart from attracting Chinese nationals who pay a higher education fee, there is a long-term economic, cultural and social benefit to be had in terms of the goodwill derived from returning students who may one day occupy positions of power or influence in a China growing day-by-day in terms of global importance. And the smart Chinese graduates who could otherwise contribute to the U.K’s business growth won’t be allowed to stay on to innovate and generate wealth – in other words, taxable income.
These are foregone ‘soft power’ benefits about which the West so frequently lectures China. But then, we wouldn’t expect an ass to understand them.
Only the other day did an influential HE public body say that U.K. university budget projections are under threat from the government’s immigration policy. The so-called ‘net migration’ target could cut overseas student intake by 50,000, at a cost to the U.K. economy of £2bn to £3bn. Higher education institutes will become poorer because of the Buridan ass.
The German and French governments are making a much better fist of attracting Chinese nationals – both tourists and students – than the U.K. For a start, the Schengen visa policy makes it easier to enter Europe. This month Germany and France set up a joint visa processing facility in Beijing which means Chinese citizens don’t have to traipse from one embassy to the other to get their visas. It cuts down on waiting time even if it doesn’t lighten the onerous application and identity validation process.
Earlier this year Germany eased its overseas student intake policies by voting through a raft of measures that make it attractive for Chinese students to study there as opposed to the U.K. For example, they will be allowed to remain in Germany 18 months after graduation to look for permanent employment. Whilst Germany is not the land of Shakespeare or Keynes, it has the rich philosophical heritage of Goethe and Kant. A tradition of intellectual eminence is not a British monopoly and never was.
Why is it that the present coalition UK government persists in blocking – or discouraging – Chinese tourists and students from studying in, or visiting, the Sceptered Isles? After all, both groups represent hard cash for the UK exchequer.
Who cares where the increasingly wealthy Chinese put their money – on educating their kids in Harrow, on lavish shopping sprees in Harrods, on aspiring sons and daughters as future alumni of Oxford – just so long as they’re spending? These UK visitors aren’t terrorists or tax evaders. They are legitimate consumers who have chosen to come to Britain – because of its attractive multi-faceted reputation – and spread their wealth. But only insofar as the U.K. allows them in.
The only explanation for all this ‘net migration’ nonsense is the Buridan ass. The animal is alive, well, prevaricating and causing itself problems in London. Having originated the Buridan dilemma in the first place, France – being part of today’s Schengen agreement – deservedly has the last laugh over the U.K’s ridiculous and indefensible position when it comes to Chinese visitors. That must hurt the British as much as the U.K’s visa policy does Chinese citizens.