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News Junction > Blog > World News > Chinese tourists are traveling but staying in China
Chinese tourists are traveling but staying in China
World News

Chinese tourists are traveling but staying in China

Published July 26, 2023
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Contents
Flight capacity and geopoliticsSpending is downStill, interest is increasingA ‘spread out’ recovery

Are you prepared?

That was the question that many in the travel industry asked following China’s surprise reopening announcement in the final days of 2022.

Many assumed that a torrent of travelers would be lining up to venture outside of China after three years of harsh “zero-Covid” policies.    

Yet, many residents stayed home — either because they wanted to, or because it was too difficult and costly to leave the country.

A lack of affordable flights and protracted waiting times for travel visas to go abroad have slowed China’s outbound recovery, says Wolfgang Georg Arlt, founder and chief executive of Chinese Outbound Tourism Research Institute.

Domestic airline capacity in China has fully recovered, yet international flight capacity is still less than half of pre-pandemic levels, down nearly 5 million seats, according to Skift Research’s “State of Travel 2023” report published last week.

“However, another reason is that domestic tourism has won in prestige and also in quality,” Arlt told CNBC Travel.

“For the last holidays, like Dragon Boat race festival, the domestic tourism level was already back to 2019 levels. Outbound travel is only back to about one-third of 2019 levels [in terms] of number of trips.”

Flight capacity and geopolitics

Asia-Pacific was predicted to be the primary beneficiary of China’s border reopening.

However, the number of Chinese visitors to Thailand, Singapore, Indonesia and the Philippines was down at least 60% this May, compared to the same time in 2019, according to Reuters.

Now, Chinese travelers may be looking to venture beyond the region.

According to a June survey by the research intelligence company Morning Consult, Chinese interest to visit Europe, Central America and Antarctica is up — with plans to visit the Middle East and Northern Africa, namely Egypt, rising the most.

However, travel plans to go elsewhere, most notably the United States, have dropped, according to the survey, which was summarized in a report published by Morning Consult in July.

Worsening ties between China and the West have not helped the situation.

Scott Moskowitz

Morning Consult

A senior analyst at the company, Scott Moskowitz, attributed this to two main factors: flight capacity and geopolitics.

“While flights to the Middle East and North Africa have seen a dramatic recovery relative to pre-pandemic levels, flights to North America, especially the United States and Canada, have seen the most limited recovery,” said Moskowitz. “Worsening ties between China and the West have not helped the situation.”

The war in Ukraine has further exacerbated issues because North American carriers cannot fly through Russian air space which makes flights between China and North America longer and more expensive, he said.

“Chinese carriers have not been bound by the same restrictions, which have made Western carriers more hesitant to resume less competitive routes,” he said. “Though recently, Chinese airlines quietly added a small number of routes that avoid Russian air space.”

As to increased interest to vacation in the Middle East and Northern Africa, Moskowitz said: “China has been on a charm offensive in the region recently, deepening diplomatic and business ties.”

“This creates business need for increased flights but has also seen increased Chinese media coverage and general interest in the region which will have knock-on effects for more general travel interest.”

Spending is down

Travel spending has also been disappointing this year, as Chinese tourists tighten their purse strings while the country’s post-Covid economic recovery struggles to find a foothold.

“Chinese are more careful with spending due to the economic slowdown,” said Arlt.

In Skift’s report, travel ranked No. 3 on a list of expenditures where Chinese travelers said they would increase spending this year — after dining out, and fitness and wellness. Yet only 8% of respondents said they planned to do so.

Record high unemployment among Chinese youth likely isn’t helping, as Millennials and Gen Zs in other countries led the way in international travel bookings.

Still, interest is increasing

Though 2023 hasn’t materialized the way much of the travel industry had hoped, the number of Chinese leisure travelers who say they want to travel abroad has nearly doubled since last year — rising from 28% to 52%, according to Morning Consult.

Similarly, the company’s data shows interest in business travel has nearly tripled, while plans to go overseas for education, to see family and for medical tourism, are also on the rise.

This mirrors Skift’s report, which shows 50% of Chinese travelers say they plan to travel internationally in the next 12 months.

Travel fears, such as concerns about contracting Covid, are also softening, according to Morning Consult. It was the top worry for travelers in 2022, but fell to the least of their concerns this year, according to the survey.

A ‘spread out’ recovery

Though Chinese residents have traditionally preferred to spend on discretionary items, the Mastercard Economics Institute expects to see them shift toward discretionary services such as travel, according to its “Travel Industry Trends 2023” report.

“Despite a love for shopping, we expect travelers from mainland China to spend more on experiences, rather than things, after a zero-Covid environment,” the report said.

David Mann, Mastercard’s Asia-Pacific chief economist said he doesn’t expect travel recovery to slow down in Asia-Pacific, despite ongoing economic instability around the globe.

“As capacity increases, costs should come down, stimulating more travel,” he said.

Rather than a “boom,” international travel in China is slowly, yet steadily getting back on track, Mann said.

“China’s international travel recovery is being spread out over 2023-24 … an ongoing positive for the industry.”

#Chinese #tourists #traveling #staying #China

TAGGED:Asia Economybusiness newsBusiness travelChinaChineseEconomyEntertainmentFamily travelholidaysHospitality and leisure industryHotels and resortsIndonesiaLifeLifestyleMiddle EastNorth AfricaPhilippinesSingaporestayingThailandTourismTouriststravelTravel safetytravelingUnited StatesVacation costsVacationsWealthWorld economy
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