Bank of China offers expanded yuan service

by Sean McLachlan on

The Bank of China has begun offering its customers in New York City and Los Angeles services in yuan, Bloomberg reports. Services include deposit, exchange, remittance, and trade finance. Business customers may access these services in New York City and Los Angeles, while at the moment individual customers can only access these services at the New York City branch.

What does this mean for travelers? Not much, yet. If you’re one of the many English teachers in China you can send money home more easily, but that’s about it.

It’s the long-term view that’s interesting. China is obviously trying to expand the range of the yuan (also called the renminbi) beyond its borders. In fact, Chinese Premier Wen Jiabao said as much last year when he expressed worry over how much China’s international assets are dominated by the dollar. This move allows international trading in yuan, which is sure to attract more investment and, if it’s successful, bolster the currency’s strength. It’s already at an all-time high against the dollar. The New York branch’s general manager says the move will eventually lead to the yuan being fully exchangeable with the dollar.

This will encourage further investment in China and could lead to more foreign businesses opening up shop there. It would also make it easier for international travel businesses to have offices in China. A yuan that’s strong against the dollar, however, will make trips to China more expensive for Americans.

Tourism is one of the fastest growing sectors in the Chinese economy. More and more Chinese are traveling abroad, and with greater access and use of their currency, those numbers will only increase. The World Trade Organization says if current trends continue, China will have the largest share of the world’s tourism industry by 2020, with 8.6 percent of global revenue.

Could yuan become another international currency like the dollar and the euro? Could we see money changers accepting them in more destinations? Only time will tell.

[Photo courtesy user Polylepsis via Wikimedia Commons]

Australia floods leave tourist industry in peril

by Sean McLachlan on


The terrible floods in Queensland, Australia, have destroyed thousands of homes, done billions of dollars of damage, and have left at least a dozen people dead. Queensland is a major coal exporter, and with the rising waters hampering shipments and flooding mines, world coal prices have risen. A major consumer of Queensland coal are Asian steel mills, which are already feeling the pinch. This has led to a rise in steel prices. That’s a double dose of bad news for the economic recovery.

Another Queensland industry has also been hard hit–tourism. The tourists have fled along with the residents, but it’s the long-term effects that are more harmful. If rising coal and steel prices hurt the economic recovery, that’s bound to hurt the tourism industry pretty much everywhere. Brisbane, Australia’s third-largest city, is the center for Australia’s Gold Coast, a major draw for Australia’s $32 billion tourist industry. Floods are damaging popular beaches and will require costly repairs. Coastal and riverside hotels and shops are being destroyed. The Brisbane Times reports that toxic materials washed into the sea could have an effect on delicate coral reefs and fish populations. With snorkeling and scuba diving such popular activities on the Gold and Sunshine Coasts, this could do long-term damage to tourism.

Meanwhile, airlines are worried about how this will affect them. Virgin Blue has already seen its shares drop by 3.4 percent today because investors fear there will be a drop in bookings. Qantas shares also dipped slightly. Airlines are issuing fee waivers for passengers who want to change their flights to, from, or through Brisbane.

It looks like Queensland residents will suffer from the flood long after the waters recede.

[Photo of Brisbane sunset courtesy user t i m m a y via Gadling’s flickr pool]

A new place to spend euros: Estonia

by Sean McLachlan on

One of the greatest boons to travelers in recent years is the expanding eurozone. Gone are the days when you spent a few days in France, then wasted money getting your francs exchanged into lire in order to visit Italy. There were always a few odd coins left over that ended up sitting useless in the sock drawer.

At the start of 2011, Estonia has become the 17th country to join the eurozone. The kroon will soon become a memory as the old currency is phased out.

While this is good news for travelers carrying euros, it could carry a hint of future trouble. Many countries that adopted the euro saw prices rise as shopkeepers rounded up in the exchange. This is what happened in Spain, and prices never stopped rising. What used to be a budget travel destination soon became almost as expensive as the rest of Europe. Living in Madrid I’m constantly hearing Spaniards complain about how much more expensive things are these days.

Estonia has also become a budget travel destination in recent years. The Baltic republic may be small with only 1.3 million people, but it has an interesting history, some beautiful countryside, and a distinct culture. Hopefully it won’t get too expensive to experience all that.

EasyJet profits triple as budget airline attracts more passengers

by Sean McLachlan on

Budget carrier easyJet almost tripled its profits in the past 12 months as fuel prices dropped and passengers flocked to book cheap flights, BBC reports.

The airline released figures for the past twelve months through September, revealing a profit of £154m million ($247 million). The previous 12 months saw profits of £55 million ($88 million). A total of 49 million people flew on easyJet in the past year, up 8 percent.

While a 9 percent drop in fuel prices helped all airlines, there’s been a continued shift away from national carriers such as British Airways and Air France in favor of budget carriers, and no budget airline has as much share in the European market as easyJet. The carrier now accounts for 7.6 percent of the European market.

The airline also announced it will pay a dividend for the first time in 2012, and will be buying 24 airplanes in order to expand its services.

[Photo courtesy Antony J Best via Wikimedia Commons]

Gulfstream’s $500 million expansion of Savannah, GA headquarters to create 1,000 jobs

by Darren Murph on

According to many pundits, the so-called recession that gripped the world in 2009 is far from “over,” but we’ve been noticing steady signs of recovery in the travel industry over the course of 2010. While consumers and businesspeople alike are still pinching pennies and thinking twice as hard about where their funds are going, more and more bodies are moving about, particularly by plane. Gulfstream, which maintains a headquarters in Savannah, Georgia, seems more convinced than ever that we’re on the rebound, and it’s announcing today a huge investment that’ll better position it “to meet future demand for business-jet aircraft and support services.”

The spend? $500 million over the next seven years, and that’ll buy significant expansion of its Savannah plant as well as around 1,000 full-time Gulfstream Aerospace jobs (a hike of about 15 percent from its current level of 5,500 employees). According to Savannah Now, those positions will include production specialists, engineers, and support technicians. Needless to say, quite a few folks in the Peach State are celebrating the news, with Gov. Sonny Perdue being one of many on hand today for the announcement. Moreover, the expansion will result in new facilities at the northwest quadrant of the Savannah / Hilton Head International Airport.

Gulfstream suggests that the investment will also help it meet a growing demand for large-cabin aircraft, with large chunks of the cash used to build production plants for G650 (“Like a G6!”) and G250 jets, as well as maintenance capacity for all of the models that the company manufactures. Unsurprisingly, we’re hearing that the bulk of that demand is coming from international clients (Asia Pacific, specifically), but the company seems bound and determined to keep its roots in the south.

We know Gulfstream doesn’t speak for the entire aviation industry, but it’s definitely good to see a major player like this making such a tremendous investment in the future of air travel. Here’s hoping it’s just the beginning of a beautiful turnaround.

[Via Twitter (@mksteele)]