Hong Kong and Macau have profited from the boom in mainland Chinese tourism and consumerism. But this may be ending, with implications for China’s two Special Administrative Regions, say Ed Wiltshire and Will Ballard.

 

Enchanted Storybook Castle? Check. Jack Sparrow’s Treasure Cove? Check. Regiment of Imperial Stormtroopers? Check. Anyone familiar with entertainment group Walt Disney’s canon would have felt right at home in the company’s theme park near Shanghai when it opened for business in June.

Disney has made some concessions to local mores, however. Main Street USA has become Mickey’s Avenue; Donald Duck has developed a previously unsuspected interest in Tai Chi; with wider walkways to accommodate multi-generational groups. A Chinese family trip to Disneyland isn’t complete unless both sets of grandparents come too.

Disney targets Chinese middle classes

Such willingness to compromise, steering a path between providing the genuine Disney experience and respecting local tastes, is unsurprising.  After all, this is not the Mouse’s first trip to Asia. Tokyo Disneyland, the first of the franchise constructed outside of the US, opened in 1983.  The attraction had already been visited by 140 million1 people by 1994; a figure greater than the population of Japan in 20152. Its popularity has continued despite the economic travails of the local economy. In 2014, it hosted over 17.3 million3 visitors after becoming  the second most popular theme park in the world in 2013.

Shanghai Disneyland may put those numbers in the shade. The prize, if successful, is access to the growing Chinese middle class market. The location was chosen in part because the company reckons there are nearly a third of a billion people with suitable incomes within a three-hour drive.

Important Information

Unless stated otherwise, any sources and opinions expressed are those of Aviva Investors Global Services Limited (Aviva Investors) as at 06 July 2016. They should not be viewed as indicating any guarantee of return from an investment managed by Aviva Investors nor as advice of any nature. Past performance is not a guide to future returns. The value of an investment and any income from it may go down as well as up and the investor may not get back the original amount invested.

Issued by Aviva Investors Global Services Limited, registered in England No. 1151805.  Registered Office: St. Helen’s, 1 Undershaft, London EC3P 3DQ.  Authorised and regulated by the Financial Conduct Authority and a member of the Investment Association.  Contact us at Aviva Investors Global Services Limited, St. Helen’s, 1 Undershaft, London EC3P 3DQ.

Approved for Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the UK.

RA16/0470