Analyzing China's golf disaster

Analyzing China's golf disaster

To the outside world, China's golf development has ground to a halt. However, guest columnist David Dale, who has been designing and building courses in China since the mid-80s, explains this apparent stagnation might not necessarily be true.

Subscribe
March 8, 2017
Business Management Career Top Stories
By now, most in the golf industry have seen the headlines out of China: More courses closed down or halted mid-construction.

I’m not saying this is cause for celebration. But please, take it from someone who has been designing and building golf courses in China since the mid-1980s: Context is everything there. It’s not the stone-cold disaster it might seem.

In order to get what’s going on here, let’s back up a bit and quickly track the longer arc of golf development practices in China.

China’s Central Government banned new golf course construction back in 2004. This edict was considered largely political and rhetorical, and so it was treated. Local government officials continued to negotiate deals with developers to build new courses more or less under the radar, i.e. with local approvals but never Central Government approvals. Everyone knew there would be a reckoning at some point and it came in 2014, when the Central Government shut down some 80 golf course projects built since 2004.

This was, of course, disheartening for all of us who’ve designed and built courses in China. We at Golfplan lost only 1 course to this forced attrition, Qiandahou Country Club (named Best New Course in China for 2008). While we knew the reckoning was nigh, we also recognized just how much the Chinese have come to love their golf — the number of junior players there is staggering (even this enthusiasm would appear totally at odds with the Central Government’s official stance).

But old China hands like myself are quite used to this contradictory dynamic. Indeed, while these 80-odd courses had been closed, the Central Government has been quite open about the fact that it will soon issue nationwide golf development regulations that would enable new courses to be built. Officially.

So, while last week’s announcement of additional 111 closures was disappointing, my sources in China still expect those regulations to be issued sometime in the future, though perhaps not so long as President Xi Jinping presides. His anti-golf rhetoric has been too heated to walk back (though even he has his critics within the country; there is dissent in China and official stances can/do change).

What’s more, the nature of these most recent closures — nearly all of the doomed courses were cited for environmental or water-related infractions — strongly suggests the Central Government used these new (but still embargoed) regulations to justify these additional 111 closures, the ones we learned about recently.

In any case, it seems to me the bleeding has finally stopped in China. What remains are 496 courses (according to the Asian Golf Industry Foundation) that should live on in the traditional fashion. That’s good news for many in the golf industry, especially those vendors whose products allow ongoing course maintenance. Seven hundred courses would be better, but 500 still pegs China as the second largest course market in all of Asia. And a country/government that wanted golf completely gone would have closed every last one of them.

Once the Central Government does issue the new development guidelines, and we’re all working from the same playbook, the course stock will grow again. There is demand, and the demand demands it (!). In the last three months, my office has been contacted about three new projects in China. This stands on top of several more projects that have been placed on hold since 2014. All of these local partners also see the fog lifting, ever so slowly.

These new regulations, whenever they are finally issued, will do something else important: They will spur development and help squash corruption related to future development. At Golfplan, we get around more than just about anyone in this business (since 1972, we’ve created 217 courses in 32 countries; in many cases, we created the very first modern courses in these fledgling golf nations). Over and over again, we’ve seen how a lack of government regulation can pervert the development process — and China was hardly an exception.

I saw an entire village disappear when we built Grand Shanghai International G&CC back in in the early 1990s. Brick by brick, the locals who had lived on the property — who formed the labor force that built the new golf course — disassembled their own homes and moved away. Were they fairly and lawfully compensated? Who knows?

Like any nation, China needs comprehensive regulations to guide future course development. The environment demands it. Those who might be steamrolled by a corrupt system demand it. Chinese golfers, in their millions, demand it. Last week may seem like a step backward, but it’s actually a small but perceptible leap forward.

About the author
David M. Dale, ASGCA, is the principal of Golfplan - Dale & Ramsey Golf Course Architecture, which has completed more than 200 courses in more than 30 countries around the world since 1972.