China's tourism sector hopes for New Year's boost

With the easing of China’s zero-Covid approach, the country’s tourism industry had been hoping to see trade pick up over the coming New Year holiday period, but that seems unlikely given a surge in new cases and the changed behaviour of consumers.

What’s happening

Domestically, people no longer require a QR code showing a negative test result to leave home, use public transport and enter (most) public places. And from next Sunday (January 8), travellers to China will only need to present a negative PCR test result from the previous 48 hours at customs in order to enter the country. 

But lockdowns are still possible in “high-risk areas”. And while it’s become easier for overseas travellers to enter China, it’s potentially becoming harder for Chinese tourists to disembark in overseas countries – new travel restrictions are being considered amid international debate about the accuracy of the reporting of new Covid cases in the country.

Domestic travel 

Over the recent holiday period that ended on Monday, there were some 52.7 million internal trips, according to figures from the Ministry of Culture and Tourism – only a marginal increase from the same period last year and less than half that of the equivalent time in 2019. 

The South China Morning Post reports anecdotal evidence from industry experts and travel agencies suggesting that, given ongoing uncertainties, people are choosing shorter, less expensive trips than before.

The international context

Pre-Covid, China registered 145 million international visits in 2019; three years later the total is projected to be around 20 million. The possibility of easier travel to the country, however, has to be offset against the rise in new Covid cases which will discourage many people from visiting. 

At the same time, there’s a Catch-22: overseas airlines will need to increase the number of flights to China, which were limited during the zero-Covid approach. But if new Covid outbreaks deter travellers, a lack of demand could push up flight prices, one observer noted, further discouraging people from travelling to the country.

Key quote

“The pent-up desire Chinese people have to travel has fuelled the moderate recovery we saw over the New Year period, but the purchasing power of Chinese tourists has been weakened due to the sluggish economy and rising unemployment, causing people to shorten or delay their trips” – Liu Simin, tourism expert at the China Society for Futures Studies research institute.

Sourced from South China Morning Post, Politico