May 15, 2008 -- The Beijing Olympic Games will have a deep impact on the tourism industry's hotel sector and increase global awareness of China's cultural destinations in the west and central regions.

"The Beijing Olympic Games is a good opportunity for global promotion of China, because most foreigners don't know China very well so far," Weilong Guo, marketing manager of Shanghai-based GreenTree Inns Hotel Group Management Co., told Emerging China.

The direct impact will be on Beijing city, being the center and first stop of the pageant. Hotel prices in the city have already ballooned 10 times the normal rate, according to a local media report. The tour fee for each person would likely exceed 10,000 yuan (US$1,428), the report said. Some Guangzhou travel agencies expect to cooperate with the giant travel agencies in Beijing to create tours supporting the Olympic Games, it added.

Cities around Beijing, especially those with great sceneries and historical sites, as well as the western and central regions of China, would attract visitors as well, according to Guo.

He said top tour options would be the Potala Palace in Tibet, Jiuzhaigou National Park in Sichuan province, Dunhuang Mogao Grottoes in Gansu province and the Terracotta Army located at the Xi'an capital city of Shaan'xi province.

Qinhuangdao, a city near Beijing, has invested almost 900 million yuan (US$129 million), to develop local facilities for foreign tourists, local media website Eastgate.com reported. As the only prefecture-level city assisted by the Olympic Games, Qinhuangdao will grasp the opportunity to develop its traveling business, the report said. The city's tourism bureau has beefed up 25 major tourism sites and undertaken 100 tourism infrastructure projects to prepare for the Olympics. It has built tours around the "Great Wall and seaside park" theme, according to the local media report.

Meanwhile, Shanghai has joined a regional cooperation union, which includes 10 cities of the circum-Bohai region, such as Beijing, Chongqing, Xi'an, Hangzhou and Guilin, to promote Olympic tourist routes, according to a report of the Shanghai tourism commission.

With the Olympics approaching, competition in the hotel industry is becoming fierce, according to Ding Wang, a tourism industry analyst at GuangFa Securities Co. Ltd. He said the hotel industry in Shanghai and Beijing could meet the expected high demand with the presence of many foreign top brand hotels in these cities, but labor rates have been shooting up lately.

"As to the domestic travel agencies, some emerging e-commerce trip networks, such as ctrip.com and mangocity.com, will seize this opportunity to further improve their visibility in the market and expand their market share," Wang told Emerging China.

He said some of the regions of west and central China, as well as hot tourist cities like Chongqing and Chengdu would be noticed by more foreign visitors as a result of the Olympic Games.

But the prospects for joint-venture travel agencies or small-scale traveling companies remain unclear, he said, even as the government has gradually liberalized the industry in mainland China.

"Actually, the impact from the Beijing Olympic Games on China's tourism industry is mainly short term and limited," Wang told Emerging China. "After the Olympic Games, the hotel industry will be seriously diminished."

But according to GreenTree Inns' Guo, he expects the tourist traffic surge in the central and western regions, including the Midwest, to last for about a year. "Although this impact will not necessarily be as great as during the Olympic Games, it will be more long term."