China Clamps Down on Golf Courses

In China, golfers pay more than $50,000 annually to enjoy what has long been a wealthy person's sport. Now, many club members across the world's most populous nation are probably clamoring to get their money back.

That's because on March 30 the Communist Party shuttered 66 courses in China to fight corruption and preserve the environment. More than 600 courses still remain, but until the dust settles, Chinese golfers have reason to feel nervous about their investments in club memberships.

To wit: members of the CTS Tycoon Golf Club in Shenzhen, where membership costs more than $130,000, saw the local government shutter their course due to its proximity to a drinking water reservoir.

For the golf world, the crackdown is also a heavy blow. Until this setback, golf's popularity was growing rapidly in China—home to more than 1.3 billion people.

Those that have been following Chinese president Xi Jinping's administration likely aren't surprised by this move.

Since assuming the country's highest office in 2012, Xi has made anti-corruption a significant goal. According to The Atlantic, 201,600 officials have been prosecuted for corruption over the past three years. Membership fees to some golf clubs in China cost more than $100,000 annually; meanwhile, the country's civil servants make far less than that per year, with Xi himself earning approximately $22,000.

A lot of questions are raised when officials are seen on pricey courses.

Xi's administration also is concerned about environmental degradation. In April, the government unveiled a water action plan to preserve China's precious groundwater resources. The country has 20 percent of the world's population, but only seven percent of the world's fresh water and nine percent of its arable land, according to the Wilson Center. Golf courses, though they can sometimes be a boon for a local economy, require large amounts of freshwater to be maintained, and reduce the amount of land available for farming.

The golf crackdown is a "perfect storm of politics and environmental concerns," said architect Brian Curley, who has designed more than 40 courses in China.

Officially, China banned the construction of new courses in 2004. Over the past ten years, however, more than 600 courses were built throughout the country, the most in the world during that period.

The dissonance reflects China's long-conflicted relationship with golf: after Mao Zedong banned and condemned it for being a "sport for millionaires," golf became taboo. Deng Xiaoping's lifted the ban as part of his mid-1980s reforms, but the sport remained controversial.

As economic development spread rapidly in the country at the turn of the century, local and provincial governments—who own a significant portion of the nation's land—saw golf as a way to increase their tax bases and make money, according to Dan Washburn, author of The Forbidden Game. They sold their land to developers, who often avoided the 2004 ban by incorporating courses into high-end living communities.

"There's this saying [in China] 'the mountain is high, and the emperor is far away,'" Washburn said. "I think that is very true in the golf industry. Beijing may have its rules, but how it's interpreted in the provinces is a different story."

Richard Zhang, co-founder of the sports marketing company Ocean 24, said he's witnessed the correlation between housing developers and golf firsthand. While visiting a mansion community in Laiwu, a city in Shandong province, a friend who resides in the city brought him to a suburban neighborhood where a golf course was being built on the property. Anyone who bought a house in the development received a membership. Zhang said construction has been suspended because of the crackdown.

Washburn says golf provides a window into the tensions between China's central and provincial governments.

Although the rapid development of golf since 2004 shows the central government's weakness to enforce its own land laws, that decentralization is pervasive in other industries as well—and, to an extent, has been deliberate, allowing many provinces to thrive economically.

"A great part of China's success was by decentralizing its government," Jennifer Turner, the director of the China Environment Forum at the Woodrow Wilson Center said. "Now you have issues of environmental degradation and abuse of power."

Although the central government seems to be reasserting its power over golf construction, Curley isn't sure what is in store for the courses that were shut down and the remaining 600 that are still open for business.

"China is kind of a land of contradictions. They call it red China, but I call it grey China," Curley said. "Because nothing is really ever black and white, even if there is a policy that comes down on golf, it will vary from region to region. Every place is going to have its own unique situation."

He thinks that as long as the remaining 600 courses fix any conflicts they have with their local population—such as illegal land grabs and environmental pollution—the majority may survive the crackdown.

Curley also believes that the crackdown may end up helping Chinese golf in the long run. Had course construction continued at a rapid pace and and ended up filling in a vital wetland or causing a major environmental issue for a region, he said, the fallout could have resulted in a "devastating blow," derailing the entire industry in China.

There's one element that Curley, Washburn and Zhang all agree is a wild card for the sport's trajectory in China: the Olympics.

Chinese golfers have started making international waves. Feng Shanshan of Guangzhou won the LPGA championship in 2012—becoming the first Chinese woman to win on the Tour—and has pocketed $5,767,574 in career earnings. Liang Wen-Chong, one of China's most successful male golfers, is currently ranked 259 in the world.

If Feng, Liang or any Chinese golfer medaled in a Summer Olympics over the next 10 years, the sport's semi-precarious status likely would change. Curley says if a man were to medal, an "era of embracement is a given." If a Chinese golfer ever seriously contends on the PGA Tour, he says, sponsorship money would be off the charts, and sales of golf equipment—which might slow down due to Xi's crackdown—could spike.

"If a Chinese golfer medals you could not imagine what it could do," he said.

Zhang concurs, and said that if a Chinese golfer has a breakthrough similar to Yao Ming, it's going be a huge deal.

It might be years before China builds on Feng's accomplishment, but given the country's unprecedented investment in its Olympic team, that success could come sooner than anyone expects.

"We're going to get used to seeing more and more Chinese names on leader boards," Washburn said.

Until the boom times are back, though, Curley says there might be work for golf architects in remodeling existing courses to fit new government guidelines. But that's about it.

"We'll probably never see the kind of growth that we've seen over the past 10 years," Curley said. "But I don't see the game going away."