VZCZCXRO1214
PP RUEHCN RUEHGH RUEHVC
DE RUEHBJ #1970/01 2900844
ZNR UUUUU ZZH
P 170844Z OCT 06
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC PRIORITY 9979
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHDC
RUCPDOC/USDOC WASHDC
RUEHRC/DEPT OF AGRICULTURE WASHDC
RUEHC/DEPT OF LABOR WASHDC
RHEHNSC/NSC WASHDC

UNCLAS SECTION 01 OF 02 BEIJING 021970 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
USDOC FOR 4420 
STATE PASS USTR FOR STRATFORD, WINTER, ALTBACH 
STATE PASS CEA FOR BLOCK 
TREASURY FOR OASIA/CUSHMAN 
USDA/ERS FOR LOHMAR, TUAN, SYLVANA LI 
USDOL FOR ILAB 
 
E.O. 12958:  N/A 
TAGS: ECON EAGR ELAB PGOV SOCI CH
SUBJECT: BOOSTING RURAL INCOMES: THE CASE OF TOURISM IN 
HUNAN 
 
SUMMARY 
------- 
 
¶1. (SBU) Tourism has emerged as an important source of non- 
farm income in Hunan Province and may account for as much 
as 50 to 60 percent of rural incomes in tourist 
destinations in Hunan's countryside.  Provincial officials, 
motivated by this trend, plan to provide additional 
resources to expand the sector.  Discussions with officials 
from other provinces underscore a more general and 
widespread interest promoting domestic tourism in China's 
rural areas.  During a visit to Mao Zedong's hometown, Shao 
Shan, local officials and farmers told Econoff that the 
livelihoods of the region's residents are largely dependent 
upon tourism, or as one farmer stated, Shao Shan "still 
depends on Chairman Mao."  END SUMMARY. 
 
TRAVEL TO HUNAN 
--------------- 
 
¶2. (SBU) Shang Bin, Director of Planning and Financial 
Division, Hunan Provincial Tourism Bureau, met with Econoff 
in Changsha on September 25 and discussed recent 
developments in the province's tourism sector.  Econoff met 
with Xiangtan Municipal Tourism Bureau officials in Shao 
Shan on September 28 and interviewed farmers and 
shopkeepers in Shao Shan on September 28 and 29. 
 
RED, YELLOW, OR GREEN, HUNAN HAS LOTS OF PLACES TO BE SEEN 
--------------------------------------------- ------------- 
 
¶3. (SBU) Shang stated that tourism is developing quickly in 
Hunan's rural areas, accounting for 6.9 percent of the 
province's GDP in 2005.  According to Shang, there are 
three types of tourism:  (1) "Red" tourism to Communist 
Party "revolutionary" destinations, (2) "Yellow" tourism to 
imperial destinations, including the tombs of Emperors Yan 
and Shun, and (3) "Green" tourism to ecological tourism 
destinations, including Zhangjiajie.  Hunan is a 
particularly important Red tourism destination, with 12 of 
the country's 120 Red tourism sites, including Mao Zedong's 
hometown, Shao Shan.  Tourists to Red tourism sites have 
increased dramatically in recent years, and the number of 
visitors to Shao Shan, for example, grew by 50 percent from 
1 million to 1.5 million between 2000 and 2005. 
 
¶4. (SBU) The majority of tourists to Hunan Province are 
Mainland Chinese travelers, with some Japanese and Korean 
tourists as well, Shang stated.  Local governments want to 
boost rural incomes by encouraging domestic tourists, who 
have more disposable income than ever before, to visit 
rural areas and spend money on hotel rooms, food, tour 
guides, and souvenirs.  Shang said that Hunan Province has 
not been as successful attracting foreign tourists, but the 
province is actively promoting ecological destinations in 
order to do so. 
 
¶5. (SBU) Shang emphasized how tourism in rural areas boosts 
farmer incomes.  He offered the optimistic view that even 
in areas such where only a few hundred thousand people 
directly receive an income boost from tourism, there may be 
a few million rural residents who benefit indirectly 
through improved infrastructure or wider availability of 
other public goods. 
 
¶6. (SBU) Hunan is not the only province promoting tourism 
destinations in rural areas, and the province's experiences 
represent a national trend towards encouraging domestic 
tourism.  Yang Shengdao, Director of the Henan Provincial 
Tourism Bureau, told Econoff in March 2006 that Henan, as 
the "origin of Chinese civilization" has a unique 
opportunity to attract tourists, but that the province sees 
itself in fierce competition with other provinces for 
limited tourist revenues.  Henan Province therefore is 
aggressively promoting its tourism sector, and Yang, for 
example, spends most of the year traveling to other parts 
of China to promote the Shaolin temple (famous for martial 
arts) and other noteworthy tourist destinations in the 
 
BEIJING 00021970  002 OF 002 
 
 
province.  The goal of promoting tourism in the countryside, 
Yang said, is to help boost rural incomes. 
 
RED TOURISM IN SHAO SHAN:  STILL DEPENDING ON CHAIRMAN MAO 
--------------------------------------------- ------------- 
 
¶7. (SBU) According to officials at the Xiangtan Municipal 
Tourism Bureau, per capita income for the 102,000 residents 
of Shao Shan (which falls under Xiangtan Municipality) 
increased from RMB 6000 (USD 750) to RMB 9928 (USD 1241) 
between 2000 and 2005 with Shao Shan's rural resident 
incomes growing from RMB 2936 (USD 367) to RMB 5150 (USD 
643) during the same period.  As much as 80 percent of Shao 
Shan's population is engaged in tourism, the officials said, 
with many of them working part-time on small farm plots and 
part-time in the tourism industry.  With tourism as the 
primary driver, Shao Shan's GDP grew by 34 percent in 2005. 
 
¶8. (SBU) Although still farmers in name, many of Shao 
Shan's residents interviewed by Econoff said that their 
primary occupation is now tourism-related.  Many young 
shopkeepers said that while they have relatives (including 
parents or siblings) who are farmers, they enjoy a more 
relaxed life and earn more money by selling Mao trinkets in 
roadside stands.  For others, the tourism industry is a 
lifeline and an escape from a much harder life.  One farmer 
told Econoff that she derives approximately 60 percent of 
her income from hawking Mao pins with the remainder of her 
income dependent on growing rice.  She said that without 
the tourism revenue, it would be difficult to survive on 
agricultural production alone.  "You could say that we 
still depend on Chairman Mao," she said. 
 
COMMENT 
------- 
 
¶9. (SBU) People all too quickly sum up China's countryside 
as the home of 800 million poor farmers, but the reality is 
far more nuanced, involving widespread migration to large 
cities and rural residents living urban lifestyles in large 
towns with increasing reliance on non-farm income.  Local 
government's efforts to expand tourism--even though it 
remains a small share of provincial GDP--illustrate the 
importance that they attach to boosting non-farm income and 
the recognition that agriculture alone will not help rural 
residents narrow the rural-urban income gap.  END COMMENT. 
 
RANDT