Chinese paranoia threatens Olympic profits

While Beijing expects to welcome half-a-million overseas spectators to the coming Olympic Games, which it is promoting with the touchy-feely tagline 'One World, One Dream', foreigners based in China's most cosmopolitan metropolis, Shanghai, are suffering the fall-out from official paranoia.

Even though many of them are married to Chinese nationals, or legitimately own their own homes in the city, 20 per cent of non-Chinese residents are believed to have left - for the summer, at least - because of draconian new visa requirements and denials on extensions of residence or work permits.
 
Authorities claim the clampdown is essential to security, stating concerns about protests that marred the Olympic torch rally and threats of terrorism.

But those affected fear that the traditionally laissez faire attitude to entry requirements - which have allowed thousands of entrepreneurial foreigners to live and work in Shanghai on one-year multiple entry visas (with no time limit on the length of each stay) - could be coming to an end. This would have a serious effect on future foreign investment.
 
Alluding to the algae outbreak that threatens Olympic sailing events in the coastal city of Qingdao, the Shanghai-based market research company Access Asia summed up the feelings of many long-term foreign residents in its email newsletter. "The China visa issue," it said, "is now becoming more unpleasant than a stroll on a Qingdao beach."

"It's ridiculous," agrees a 50-something British marketing consultant, who has lived in Shanghai since 2003. Though married to a Chinese woman and owning a £500,000 luxury apartment in the city, he packed his bags for Surrey last week after having a visa extension application denied.

"I've made a massive investment [in Shanghai]," he says, preferring not to be named lest it affect future access to the city he calls home. "I've not been hiding in the shadows for five years. Everything has been above board. It just shows how fragile the life I've created in China really is."

Irishman Alan Duffy, general manager of Sasha's Bar & Restaurant in Shanghai, told The First Post that the visa clampdown was causing huge difficulties with staff from the Philippines, who are especially valued for their English-speaking ability. "In only a matter of months our Filipino staff levels have been cut by 80 per cent as most of them cannot extend their work visas. We are having to hire unskilled workers and train them while also providing English lessons."

Hotels, travel and tour agencies, golf courses and convention organisers also report problems during what was expected to be a bumper year. Tourism industry estimates say China recorded a drop of 12-18 per cent on visitors in May.

Meanwhile, at a time when China should be putting out the welcome mat to foreign visitors to the Games, those outsiders remaining in Shanghai are finding that just having a foreign face is suddenly enough to have you pulled over on the streets of a city once proud to be the most international and forward-looking in China.

"Authorities are stopping laowai [Westerners] and demanding to see passports," says Duffy. "If you are not carrying your passport - and who does all the time? - you will be escorted to the nearest police station. The anticipation for the Olympics that was enjoyed last year has quickly turned to trepidation." ·