Taiwan and tropical tourists

The specter of regular airline service from Taiwan is certainly a welcome prospect for our tourism industry. So what is the economic profile of this potential market for tourism?

Economically speaking, Taiwan is far smaller than Japan, and is substantially smaller than Korea, too. The numbers look like this: Gross Domestic Product (GDP) adjusted for price levels (which we call Purchasing Power Parity, or PPP) for Japan is about $3 trillion. South Korea comes in at $578 billion. Taiwan, $381 billion.

A trillion, by the way, is a thousand billion.

These GDP numbers give us a feeling for the absolute (as well as comparative) size of the economies. Something else to be pondered is what the average citizens’ slice of the economic pie is. This gives us an idea as to whether the folks are viable candidates for overseas travel.

The numbers come in like so, again based on GDP at PPP figures. The “per-capita” figures are $24,380 for Japan, $12,445 for Korea, and $17,495 for Taiwan.

When pondering tourism, the PPP calculation (remember that? It’s how we account for different costs of living in different places) is problematic. It does give us some feeling for how much economic muscle people have, but when we muddy the waters with cost of living adjustments, it understates the tourism potential for places with a high cost of living (e.g. Japan).

But per-capita GDP at PPP is a conventional yardstick and the data is easily found and understood, so we’ll just be thankful we’ve got it.

So here’s what we come up with. The average Taiwanese has 41 percent more purchasing power than the average Korean does, but has 23 percent less purchasing power than the average Japanese does.

Which makes Taiwan seem juicier than Korea is, but don’t lose sight of the fact that there are 47 million South Koreans and only 22 million Taiwanese.

Got all that? Isn’t economics fun?

Something else to consider is that Taiwan is a tropical island. Well, about a third of it is, anyway. The Tropic of Cancer cuts right across it. We are, then, selling tropical sunshine to folks who live under…tropical sunshine. Of course, folks in Saipan are no strangers to Bali, so we know that there’s a demand for tropical sunshine even amongst those who live under it.

Still, the bitter cold in Korea and the chills in Japan are certainly a factor that drives their people down here. This is a factor lacking in Taiwan.

Taiwan has a solid industrial base, and is a major player in the high tech world. Barring any strangeness coming from mainland China, there’s room for a lot of optimism about Taiwan’s economic future. Its latest growth figure came in at about seven percent a year, which is red-hot by industrialized standards.

And that, folks, is pretty much an overview of Taiwan’s economic situation. It is a viable market for tourism, and we’d all be happy to see the planes, and tourists, arriving in Saipan.