China's bubble gets bigger

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China seems to be the fastest-growing golf market in the world. Despite the fact that data is hard to come by, we have heard reports that as many as 1,000 new courses will open over the next few decades.

And now we learn that the PGA Show is partnering with the China Golf Association to turn two golf shows into official PGA Merchandise Shows. Both the The PGA of America and the Golf Course Superintendents Association of America are supporting the new shows, which will feature golf equipment, apparel, business-to-business products and services, and construction, design and maintenance products.

It seems to be an attempt by The PGA and GCSAA to expand their brand into Asia, and in doing so, create overseas job opportunities for their members. The PGA even rolled out Greg Norman to talk about the huge opportunities in the Far East. With all of the hype, you can't blame the American associations for jumping on the bandwagon.

But while there has been hype about other countries in the past, it sadly always faded along with lost investment money. Some say this is different — that China is the world’s most populous country, has the fastest-growing economy, and its scale and size are beyond anything we have ever seen. Yet, if its bubble were too burst, all of those new golf courses could become ghost tracks.

Could that happen? Look at Dubai. Everyone said it was on an unimaginable growth spurt. Development is not completely dead in the emirate, but just this week it was announced that Tiger Wood’s golf course development had been suspended.

No country is immune from market forces — even one where the government runs the capitalism. Or perhaps I should say, especially in a country where the government runs the capitalism.

Without getting into a long discussion on capitalism, suffice it to say that China faces serious threats to a free market. Pervasive corruption, an inefficient banking system, severe pollution and the lack of rule of law all point to an economy that will hit the skids at some point. Perhaps the country can modify and improve before the great burst. But, I would not bet my money on its long-term stability. 

As for the PGA and the GCSAA, why not tap into a market when things are good? Just don't bet the farm.


I recently left employment with a Korean based golf development company. they were in the process of building three new courses in China, but were unwilling to provide financial resources to even maintain the course here in the United States. While the Chinese are fast becoming a world-wide economic force, the common laborer will not have the money to play golf on these new courses... and I suspect that there will not be enough white-collar execs to support all these "1000's" of courses. I would hope for Good Luck to the PGA, but "caveat emptor !"

Rudy Anderson has done his home work and Mr. Crittenden has not on what is going on in China. As an American Golf Architect I have completed more than 20 courses in mainland China over the past two decades since the late 80's. During this time, I have watched the the country evolve, the golf industry develop from nothing, as well as witnessed the government reform in a massive and effective way. Rest assured, their leaders are clever and well informed unlike ours....I am betting on China as well.
JackC's picture

Rudy definitely knows more about Asia than I do. He has been there, and has the experience to better understand what is happening in China. My assessment is made on strictly theoretical terms. China is not a free market. As bad as some of our leaders may be, and as well informed as some of theirs may be, I would still rather bet my money on a free market. And democracy is a necessity for a free market.

Rudy Ref: satellite aerial study is currently underway by the Government to determine the exact number of courses completed and under construction. The study is scheduled to be released in April 2011. Action: Please keep us informed on how to obtain this report. Thanks Gerry

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