Kurors’ Hotels Go Ghost‑Town After China’s ‘Travel Ban’
Back in late 2017, Palau’s beaches were buzzing with half a dozen Chinese tourists per every American guest.
Fast‑forward to August 2018, the once‑glimmering skyline in the capital city of Koror is more like an abandoned set from a horror film: empty rooms, quiet boats, and the silence of a travel agency that has front‑docked a privacy screen.
Why the China‑Taiwan Tug‑of‑War Hits Palau
- Diplomatic status is key – Palau is one of Taiwan’s only 18 allies worldwide.
- China’s new rule – Tourism from Chinese groups is declared illegal “due to lack of diplomatic status.”
- Pressure mounts – Officials and local businesses are wrestling over whether to keep aligning with Taipei or to switch allegiance to the Belt‑and‑Road powerhouse.
“Tourism as a Weapon” – A Real‑World Example
Jeffrey Barabe, who owns the Palau Central Hotel and Palau Carolines Resort, states:
“There is an ongoing discussion about China weaponising tourism. Some believe that the dollars were allowed to flow in and now they’re pulling it back to try and get Palau to establish ties diplomatically.”
Curious Footprint of the Chinese Visitor Boom
- In 2017, Palau welcomed 122,000 visitors.
- 55,000 came from China – roughly half of the total guest count.
- 9,000 were from Taiwan, a reminder that their alliance still matters.
The Concrete Impact: Property & Infrastructure
Chinese investors, once in a frenzy, had been piling on:
- Sealing land deals and buying coastal prime real estate.
- Launching hotels and exciting new ventures.
Now, with the ban, the same boats that once buzzed with tourists to the “green mushroom‑shaped” Rock Islands are moored and silent.
What It Looks Like Today
- Hotel blocks and restaurants sit empty.
- Travel agencies have been boarded by a privacy screen.
- The roar of tourism engines has gone quiet, replaced by the eerie calm of a city waiting for a new policy wave.
So, the tide keeps turning: a tiny Pacific paradise now caught between two giants, trying to navigate its future with humor, resilience, and a lot of empty rooms.
Palau’s Tourism Tumble: China Hits Pause, But Palau’s Still Shining
Picture this: the comfy Palau Central Hotel in Koror, eyes on the sparkling Rock Islands, and the euros on the ticket tickets are all— gone. Palau Pacific Airways slapped a dent in the sky: no more flights to China starting at the month’s end. Why? Because every time a Chinese tourist floated over, it felt like a plan to nudge Palau away from its Taiwan-friendly vibes.
What’s Stirring the Storm?
- China’s “Tourism Tug‑Down” – The government quietly pulled a lever that slows or stops travelers heading to Palau.
- Palau Pacific’s 50% Booking Drop – In the past year, bookings plunged half‑the‑size, prompting the airline to exit the Chinese market.
- Diplomatic Drama – China has used travel bans as a subtle chess move, like when Seoul dropped its U‑S missile defense program last year.
Is it All About “One China”?
The foreign ministry insists the “one‑China principle” is the law of the land—an unbreakable rule that Taiwan is part of China. It refuses to say whether labeling Palau “illegal” is a pressure tactic, but it says any diplomatic ties must line up with that principle.
Meanwhile, Taiwan’s Ministry of Foreign Affairs keeps a strong line: “We will not bow to Beijing’s pressure.” They’re on a mission to keep Palau’s diplomatic heart beating steady, and to keep the region calm.
Palau’s President – “We’re Not Yours to Decide”
President Tommy Remengesau Jr. tells Reuters that Beijing hasn’t officially reached out about the tourist clamp‑down. He’s clear: Palau is not handing the “one‑China” key to anyone. He notes the island prefers high‑spending visitors over a rush of cheap, mass tourism that was bashing the environment.
- In 2017, the beloved Jellyfish Lake was shut down to give the dwindling jellyfish a breather.
- By 2015, Palau declared most of its territorial seas a marine sanctuary, the size of California.
So, while the Chinese ticketing plates are drying up, Palau is pivoting the narrative—quality over quantity, a dash of friendly humor, and the promise that the Island’s charm will not dim.
When China’s Buses Take a Break in Palau
Fresh‑from‑the‑shop photo of idle Chinese tour buses parked on the island’s streets—
- It’s 2018, but the story unfolds almost year‑later when the world’s great powers start play‑acting on these tiny islands.
- While the U.S. is still handing out $200 million a year in “compact funds,” Beijing is quietly inching its flag into Palauan shores.
US vs. China: Not a Game of Zero‑Sum
“The U.S. and China are not a zero‑sum match,” one U.S. State Department spokesperson chuckled to Reuters. “But we worry about debt, and the human and environmental costs that come with Chinese projects.”
- US‑sponsored security deals stretch until 2023‑24, while the Belt & Road plan is a long‑term game plan for China.
- Back in December, Washington’s wind‑up approval of $124 million for Palau was a last‑minute courtesy—but no extensions are on the horizon.
What Palau Caught From Beijing
- Former Palau President Johnson Toribiong says the island might “avoid isolation”—just like a foodie refusing to skip the dessert.
- He added, “We love Taiwan, but even Taiwanese investors feel the pull of China. Give me the money, the politics will come later.”
- Palau currently gets roughly $10 million each year from Taiwan, plus scholarships for students and medical training.
China’s “Hand‑In‑Hand” Economic Push
- 2017 trade between China and Pacific Island Forum members hit a sweet $8.2 billion—three‑quarters of the U.S. figure.
- Concessional bank loans from China to these islands are shot through, while U.S. efforts look more like charades—big flags on cars, flashy signage, and the rest.
When “China” Forgot to Build
The island’s land confusions front a half‑frozen Chinese developer’s dream.
- At a forest site leased by Hanergy, a rusted gate yells “coming soon?” but the building still dust lies like an abandoned treasure.
- Nearby, a derelict mansion—now a graffiti canvas—causes a sigh: What happened?
- Barabe, a resort operator, counters: “We secured 99‑year leases for about 60 hotels, but construction is on a vacation.
Key Players, Meeting in the Line‑of‑Fire
- Jackson M. Henry—once Palau’s ambassador to Taiwan and a real‑estate mastermind—says the island wants a friendly handshake with both the T‑pays and the C‑pays.
- He’s working to smooth Chinese investment ways ahead of the 2020 elections, eyeing the soon‑to‑be‑won Surangel Whipps Jr. campaign.
- “Chinese developers are waiting for the next administration to make a welcome mat,” Henry says. It’s politics meets money.
In short, while the U.S. plays the comforting “security blanket” role, China is dropping rent‑payers on the island. Palau might end up with a buffet of both sides—satellite TV, but also a visit from the Grey‑house.
