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<Bz50>US seeks to profit from Chinese tourist boom

NEW YORK (AP) — Standing atop the Empire State Building and looking out on the expanse of glinting skyscrapers and miniature yellow taxicabs, Lili Ma had no doubt that New York was the place to be on her vacation from China."Everybody needs to bite the Big Apple," the 36-year-old said with a smile.

Mass tourism advertising for New York — and for the US as a whole — is still forbidden in Ma's native China. But everyone knows about this place, she said. Her friends all watch "Sex and the City," and even her mother has heard of California and New York.

That name recognition, coupled with a growing interest in tourism among Chinese who have seen their incomes rise while travel restrictions have lessened, could bring a fortune to hotels, tour companies and attractions around the US.

The number of Chinese who travel outside their homeland each year is expected to nearly triple to 100 million people by 2020, and American cities and businesses are positioning themselves to profit from what they hope will be a tourist boom. They are establishing offices in China, and lobbying the government to ease restrictions on travel to the US.

"In the next 10 years, it will probably dwarf any overseas market we may have, with the potential to dwarf all overseas markets combined," said Bruce Bommarito, vice president of international market development for the Travel Industry Association.

While the number of Chinese visitors has been increasing, they certainly haven't been overrunning American tourist attractions. Just 320,000 Chinese — 1.5 percent of all overseas visitors — travelled to the US in 2006. Of the Chinese who left the mainland, fewer than 1 in 100 headed for the US, according to American and Chinese authorities.

But many American entrepreneurs believe that number could soon explode.

Noel Irwin Hentschel, CEO of tour operator AmericanTours International, said China will be her company's top business focus in the coming decades. She predicted that by 2009, Chinese tourists will account for one-tenth of the roughly one million customers her company ferries around the US each year.

"There's more than a billion people here," Hentschel said. "Twenty percent of them are the ones with the money, with the ability to travel, from what we understand. There's a lot of pent-up demand."

Rising disposable income — now averaging $4,500 a year in cities like Beijing — has made travel an increasingly attainable luxury, and one that is often viewed as a status symbol.

"China has a booming economy, and the middle class is growing very rapidly," said Ma, on a five-day, Mandarin-language bus tour of the Northeast. Faced with this new wealth, most people "want to go out of China and open their eyes," she said.

"In other parts of the US, they don't have many parties. They go to sleep early," she said before heading to see Wall Street and the World Trade Center site. But "New York is very interesting: They have many fashion shows and many parties."

To mine that interest in luxury, the Ritz-Carlton Hotel Company LLC is planning to open six hotels in China in coming years, out of the 19 it plans worldwide. Executives hope the expansion will help establish Ritz-Carlton as a high-status brand among the Chinese, said Vice President of Public Relations Vivian Deuschl.

Chinese with personal wealth estimated at more than $1 million rank travel as their top leisure activity, according to a recent survey by the Shanghai-based Hurun Report.

Gambling is also popular among Chinese visitors, and Las Vegas has been working hard to cash in on their desire to find a seat at the blackjack and baccarat tables.

Including money lost at the tables in Las Vegas and elsewhere, Chinese travellers on average spend about $5,800 per visit — more than residents of any other nation except India, according to the US Department of Commerce.

Smaller businesses, too, are working to draw Chinese visitors.

The Corning Museum of Glass in upstate New York has wined and dined Chinese tour operators, catering especially to the bus companies that pass through the area on their way between New York City and Niagara Falls. Now, one in five of their 350,000 yearly visitors arrive on these Mandarin-language tours.

And city and state tourism offices have increasingly been stepping into the mix, often side-stepping restrictions placed on the US by negotiating directly with the Chinese government.

In 2004, Nevada — with the state's Commission on Tourism then under the direction of Bommarito — became the first non-nation to win approval from the Chinese government to open a tourism office there and advertise directly to the Chinese public.

Los Angeles, San Francisco and Hawaii have since reached their own deals with the government, gaining permission to open offices or hire representatives. New York hopes to follow suit — officials at the city's tourism office have said they are in negotiations for permission to hire representatives there.

Such individual deals are necessary because China has not awarded the US "approved destination status," a designation that would facilitate group travel to the US and allow tourism advertising directly to the Chinese public.

Some industry advocates say US government restrictions present an even bigger obstacle, making it difficult for some Chinese to get tourist and business visas. But Tony Edson, the State Department assistant secretary for visa services, says the refusal rate of one in four is close to the worldwide average and the refusals are a necessary precaution against illegal immigration.