The Swan That Made a Splash in Mainland Investment
First foreign-funded top hotel faced big hurdles
Chloe Lai in Guangzhou 24 November 2008
At the point where the Pearl River washes past Shamian Island in Guangzhou, rows of European-style stone mansions are a reminder of colonial times.
Among them is a conspicuous, 34-storey, modern white building whose atrium, opened 28 years ago, still attracts crowds of visitors keen to take photographs of an elegant waterfall. It cascades down into a stream full of colourful fish, crossed by a traditional wooden bridge and reflecting the beauty and taste of traditional southern Chinese style.
It is the White Swan Hotel, the first joint-venture five-star hotel on the mainland, whose story is inseparable from the economic opening and reform policy conceived 30 years ago. It also represents an important chapter in the mainland investment experience of Hong Kong tycoon Henry Fok Ying-tung, who died in 2006.
The State Council set up a committee to attract overseas investment in hotels shortly before the third plenum of the 11th congress, in 1978, when paramount leader Deng Xiaoping put China on the path of reform. The committee’s task was to build eight joint-venture deluxe hotels - in Beijing, Shanghai, Guangzhou and Nanjing.
It was against this backdrop that Xinhua’s Hong Kong branch, Beijing’s de facto consulate in the British colony, contacted Fok, proposing he invest in Guangdong’s tourism business, according to an authorised book about Fok and the White Swan.
The book, The Glory and the Search: Henry Fok Ying-tung’s Dream and the White Swan’s Path, is recommended reading to learn the history of the hotel.
Fok and the state signed an agreement to build a hotel with between 1,000 and 2,000 rooms, making it the first foreign-invested hotel on the mainland. Design work started in January 1979.
The importance of the hotel to China’s reform is illustrated by the fact that three of the most important political figures visited it soon after its opening. Then-Communist Party chief Hu Yaobang arrived on February 9, 1983, three days after its official opening. Zhao Ziyang , who was then premier, paid a visit in November 1984 and Deng stayed there on February 19, 1985.
The dignitaries were not restricted to China’s leaders. Important guests have included Britain’s Queen Elizabeth, former US presidents Richard Nixon and George H.W. Bush, and former US secretary of state Henry Kissinger.
According to the book, Fok decided to build the hotel on Shamian Island because he wanted to it to have political importance.
“Because Shamian was a place where Chinese and dogs were not allowed when the country was at its weakest, many American and British people are familiar with it. There would be a strong political significance for modern China to have a modern, well-managed five-star hotel here,” the book quotes Fok as saying.
Choosing a site far from the airport and train station, when Guangzhou had no taxi service, meant Fok had to solve the problem of getting guests to the hotel conveniently and in comfort. His answer was to create the city’s first fleet of taxis.
The problems he encountered building the hotel and ensuring its smooth operation were far greater than the casual observer could imagine. Many of the issues seem bizarre today, to those who did not experience the mainland’s poverty and ideological rigidity at the time.
“A stream of questions cropped up in my mind, awaiting answers,” Fok said in February 1987, as he accepted an honorary doctorate from Zhongshan University.
“Wouldn’t the influx of foreign tourists adversely affect the ideology of Chinese citizens? Wouldn’t the increasing number of tourists reduce the local food supply and cause a rise in prices?
“A variety of consumer goods were rationed. When the Canton Fair was on, Guangdong had to get meat and food supplies from other provinces to satisfy the needs of visiting businesspeople. How would the local people view us? Would they consider us well-intentioned trading partners or invading exploiters?”
Nevertheless, the White Swan Hotel project advanced and went on to set many records. It was the mainland’s first five-star hotel open to the public, and not just paying guests. It boasted the first fashion model team, and was the first to be accepted to join The Leading Hotels of the World, the largest international luxury hospitality organisation.
Guangzhou newspapers reported that, on the hotel’s first day, the public lined up to visit and 400 rolls of toilet paper disappeared.
The White Swan was the first mainland hotel to have a Japanese restaurant, to send its management team to train in Hong Kong and to have its chefs learn contemporary Cantonese cuisine - also in Hong Kong.
In order to excel at service, the management decided to hire only young people to work in the kitchen, believing experienced chefs would not be open to new ideas.
New recruit Ng Kwok-keung joined in 1982, shortly after finishing high school. “It was impossible if you didn’t have connections because it was a joint-venture company, which paid a higher salary,” he said.
“I remember we received 20 per cent more pay than those working for state enterprises. I was grateful at that time because I had a job and the job was to work for a five-star hotel, so I worked very hard.”
He started as an apprentice in the kitchen that served Cantonese cuisine, and by the time he left the hotel in 2004 for a new life in Hong Kong, he had become a senior chef.
Twenty-five years after the White Swan opened its doors, the mainland is a completely different place. Big international hotels like the Shangri-La, Westin, Ritz-Carlton and Holiday Inn are commonplace in its big cities.
Now, the White Swan aims to be a model for mixed-use development blending shops, hotel and entertainment outlets. Once again, it hopes to show the way.
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The Swan That Made a Splash in Mainland Investment
First foreign-funded top hotel faced big hurdles
Chloe Lai in Guangzhou
24 November 2008
At the point where the Pearl River washes past Shamian Island in Guangzhou, rows of European-style stone mansions are a reminder of colonial times.
Among them is a conspicuous, 34-storey, modern white building whose atrium, opened 28 years ago, still attracts crowds of visitors keen to take photographs of an elegant waterfall. It cascades down into a stream full of colourful fish, crossed by a traditional wooden bridge and reflecting the beauty and taste of traditional southern Chinese style.
It is the White Swan Hotel, the first joint-venture five-star hotel on the mainland, whose story is inseparable from the economic opening and reform policy conceived 30 years ago. It also represents an important chapter in the mainland investment experience of Hong Kong tycoon Henry Fok Ying-tung, who died in 2006.
The State Council set up a committee to attract overseas investment in hotels shortly before the third plenum of the 11th congress, in 1978, when paramount leader Deng Xiaoping put China on the path of reform. The committee’s task was to build eight joint-venture deluxe hotels - in Beijing, Shanghai, Guangzhou and Nanjing.
It was against this backdrop that Xinhua’s Hong Kong branch, Beijing’s de facto consulate in the British colony, contacted Fok, proposing he invest in Guangdong’s tourism business, according to an authorised book about Fok and the White Swan.
The book, The Glory and the Search: Henry Fok Ying-tung’s Dream and the White Swan’s Path, is recommended reading to learn the history of the hotel.
Fok and the state signed an agreement to build a hotel with between 1,000 and 2,000 rooms, making it the first foreign-invested hotel on the mainland. Design work started in January 1979.
The importance of the hotel to China’s reform is illustrated by the fact that three of the most important political figures visited it soon after its opening. Then-Communist Party chief Hu Yaobang arrived on February 9, 1983, three days after its official opening. Zhao Ziyang , who was then premier, paid a visit in November 1984 and Deng stayed there on February 19, 1985.
The dignitaries were not restricted to China’s leaders. Important guests have included Britain’s Queen Elizabeth, former US presidents Richard Nixon and George H.W. Bush, and former US secretary of state Henry Kissinger.
According to the book, Fok decided to build the hotel on Shamian Island because he wanted to it to have political importance.
“Because Shamian was a place where Chinese and dogs were not allowed when the country was at its weakest, many American and British people are familiar with it. There would be a strong political significance for modern China to have a modern, well-managed five-star hotel here,” the book quotes Fok as saying.
Choosing a site far from the airport and train station, when Guangzhou had no taxi service, meant Fok had to solve the problem of getting guests to the hotel conveniently and in comfort. His answer was to create the city’s first fleet of taxis.
The problems he encountered building the hotel and ensuring its smooth operation were far greater than the casual observer could imagine. Many of the issues seem bizarre today, to those who did not experience the mainland’s poverty and ideological rigidity at the time.
“A stream of questions cropped up in my mind, awaiting answers,” Fok said in February 1987, as he accepted an honorary doctorate from Zhongshan University.
“Wouldn’t the influx of foreign tourists adversely affect the ideology of Chinese citizens? Wouldn’t the increasing number of tourists reduce the local food supply and cause a rise in prices?
“A variety of consumer goods were rationed. When the Canton Fair was on, Guangdong had to get meat and food supplies from other provinces to satisfy the needs of visiting businesspeople. How would the local people view us? Would they consider us well-intentioned trading partners or invading exploiters?”
Nevertheless, the White Swan Hotel project advanced and went on to set many records. It was the mainland’s first five-star hotel open to the public, and not just paying guests. It boasted the first fashion model team, and was the first to be accepted to join The Leading Hotels of the World, the largest international luxury hospitality organisation.
Guangzhou newspapers reported that, on the hotel’s first day, the public lined up to visit and 400 rolls of toilet paper disappeared.
The White Swan was the first mainland hotel to have a Japanese restaurant, to send its management team to train in Hong Kong and to have its chefs learn contemporary Cantonese cuisine - also in Hong Kong.
In order to excel at service, the management decided to hire only young people to work in the kitchen, believing experienced chefs would not be open to new ideas.
New recruit Ng Kwok-keung joined in 1982, shortly after finishing high school. “It was impossible if you didn’t have connections because it was a joint-venture company, which paid a higher salary,” he said.
“I remember we received 20 per cent more pay than those working for state enterprises. I was grateful at that time because I had a job and the job was to work for a five-star hotel, so I worked very hard.”
He started as an apprentice in the kitchen that served Cantonese cuisine, and by the time he left the hotel in 2004 for a new life in Hong Kong, he had become a senior chef.
Twenty-five years after the White Swan opened its doors, the mainland is a completely different place. Big international hotels like the Shangri-La, Westin, Ritz-Carlton and Holiday Inn are commonplace in its big cities.
Now, the White Swan aims to be a model for mixed-use development blending shops, hotel and entertainment outlets. Once again, it hopes to show the way.
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