Growing Asian middle class fuels theme park boom
Tuesday 21 September 2010
When Singapore first announced it was building a Universal Studios theme park, sceptics wondered if the complex would draw enough crowds to be commercially viable.
But just six months after opening, Universal Studios Singapore has already welcomed more than one million visitors, and other countries in Asia are building even bigger theme parks.
Asia has become the new frontier for large-scale outdoor entertainment complexes thanks to growing affluence in large emerging economies like China, India and Indonesia, and cheaper air travel.
"The industry is moving to Asia," said Christian Aaen, Asian regional director of research firm AECOM Economics, which specialises in entertainment and leisure industry analysis.
"With key fundamentals in place such as the growing middle class and incomes in Asia as well as demand for entertainment and leisure time, this is the perfect product for tourism and economic development," he told AFP.
Tokyo Disneyland and Disney Sea, the Universal Studios park in Osaka and South Korea's homegrown Everland ranked among the world's top 10 theme parks in terms of visitors last year, according to industry consultancy Themed Entertainment Association (TEA).
Encouraged by Asia's promise, Universal Studios signed a deal in January to build its largest theme park in the world in South Korea at a cost of around 2.67 billion dollars.
When completed in 2014, the resort will be bigger than Universal Studios' four other parks in Hollywood, Florida, Osaka and Singapore combined.
Disneyland has not fared well in Hong Kong - with a 70 million Hong Kong dollar (nine million US) loss last year, according to the South China Morning Post - but it is going ahead with a new franchise in Shanghai, with construction expected to start in November.
Denmark's Legoland is setting up its first Asian branch in Malaysia's Johore state close to Singapore, hiring builders to use the famous little plastic bricks to replicate national and state landmarks.
A recent Asian Development Bank (ADB) report said the region's middle class was growing at an exponential rate and poised to become the world's single biggest group of consumers.
In 2008, some 1.9 billion people were broadly classified by the ADB as part of the middle class in Asian developing countries, more than triple the group's size of 565 million in 1990.
China in particular saw its middle class boom, with statistics showing the share of the Chinese population with daily incomes of six to ten dollars surging from 4.8 to 25.5 percent between 1995-2007.
In India, people in that income bracket increased from about 29 percent in 1993-94 to 38 percent in 2004-05, the ADB report showed.
Wealthy Singapore, which has only five million people, is a major beneficiary of Asia's increasingly mobile middle class families.
Nearly 1.1 million tourists entered Singapore in July - a record high, thanks in part to Universal Studios - with Indonesia, China, Malaysia and India in the top five countries of origin along with Australia.
"As developing Asia's people secure their middle-class status, its emerging consumers are very much expected to become the next global consumers and assume the traditional role of the US and European middle classes," the ADB said.
AECOM's Aaen said the opening of Universal Studios in Singapore "marked the beginning of the new decade where Asia will dominate and remain the primary region for future growth of the industry".
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