Skiing in China and the World Financial Crisis

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I am taking some accumulated leave before it runs out at year end. I decided yesterday to visit one of the numerous small ski slopes that surround Beijing, catering to a nascent but enthusiastic group of mostly young Chinese who have taken up the sport. I went to Nanshan, probably the largest of the resorts, located about three quarters of an hour drive out of the city. As you can see, from one angle it looks rather beautiful and isolated. 




But get to the top of the hill and there’s no getting away from the fact that this is really urban skiing. 




Sharing a ride on the chairlift with one of the ski coaches I got some advice about ski-ing vs. snowboarding (“don’t believe what anyone tells you: you’re never too old to learn to snowboard. You just have to be ready to fall down a lot”). He also said that numbers of visitors were already noticeably down from the previous year “because of the world financial crisis.” Not particularly surprising, though there seemed to be a pretty good number of people there who must presumably have been playing hooky from work (assuming they worked) as it was a Monday afternoon. Given all the talk of the consumer as a possible white knight for the Chinese economy, the skiing industry could be an interesting leading indicator for just how bad things are going to get (or the canary in the coal mine if you prefer). A while back, I interviewed Graham Kwan, the head of a company called Melco China Resorts, an affiliate of the Hong Kong-listed gaming and leisure company Melco International, which is controlled by the son of Macau gambling tycoon Stanley Ho. Melco, Kwan told me aims to be by far China’s biggest ski resort operator and has already sunk $100 million into the resort of Yabuli near Harbin. They plan to make Yabuli, which has had a pretty dire reputation for service and maintenance until now despite being China’s biggest skiing area, a truly world class resort with three five star hotels, a fleet of new snowmaking/grooming machines, restaurants, shops, heated ski-lift cabins and even employees stationed on the slopes with backpacks full of hot chocolate for frigid skiers. They also had plans to spend many more millions on Yabuli and another resort called Beidahu near Changchun in Jilin province. (I’ll be doing a longer piece on Yabuli early in 2009) Presumably there must be some indigestion right now among Melco execs, given the size of the crisis (update: in partial answer to my question, from the company’s third quarter report here, it’s clear like everyone else they re drawing in their horns or rather battening down the hatches for the present storm; among other things they have sold three of the smaller resorts they had an interest in), though an investment that big is obviously aimed at five to ten years, by which time, inshallah, we should presumably at least be waking up from this particular economic nightmare.