The city will allow major foreign travel agencies to become controlling share-holders in joint ventures beginning this month, the Shanghai Tourism Administrative Commission announced yesterday.

Currently, there are no joint-venture travel agencies in the city, but officials would like to see one or two established by the end of this year.

The city may even allow wholly owned foreign travel agencies to set up in town before 2005, the date China promised to open the travel business as part of its bid to enter the World Trade Organization.

Currently, no local travel agencies are in substantive negotiations with foreign firms, said Huang Guang-rong of the commission.

"We are actively and broadly seeking a foreign partner, but we are still in preliminary talks with several agencies from the United States, Europe and Japan," said Zhu Eyan with Shanghai China Interna-tional Travel Service Co.

"We hope to become more competitive by learning advanced management methods from foreign travel agencies, and they seem to be quite interested in the large domestic travel market," said Zhu.

At present, there are about 10 joint-venture travel agencies in other parts of the country.

Setting up a joint venture is still a long way off for many local companies.

"We have just decided to transform from a state-owned company to a listed company and have not considered setting up a joint venture yet," said Chen Jisheng with Shanghai Spring International Travel Service Co.

"Shanghai's tourism industry is still at the elementary stage in terms of service, management and profit compared to the industry in developed countries," said Ma Xueping, an associate professor with the Shanghai Tourism Vocational School.

Ma predicts that joint ventures will do better than wholly foreign-owned companies because they will have a better understanding of local culture, an impor-tant ingredient for success in the tourism market.

( eastday.com January 29, 2002)