From the American Prospect:
The size of the trade deficit with China is one of the hottest potatoes in American economic policy these days. It is about to get a little hotter, thanks to Beijing’s highly provocative, if hitherto largely overlooked, controls on outbound tourism.
In theory the United States should be a major beneficiary — perhaps the major beneficiary — of a recent trend for Chinese tourists to travel abroad. In practice, however, the United States ranks low on the list of Chinese tourist destinations. On the most recent figures available, it received only one-quarter as many Chinese tourists as, for instance, Italy. Of the 49.4 million foreigners admitted to the United States in 2005 on all non-immigrant visas, nearly 300,000 came from China. By comparison 383,400 came from tiny Ireland and about 319,000 from Taiwan, countries that boast respectively 0.3 percent and 1.7 percent of mainland China’s population.
Clearly there are cultural and economic reasons for the differential. But it is Chinese regulation that most stymies America’s ability to generate invisible exports from Chinese tourism. [Full text]
