Chinese Domestic Tourism Thrives Amid Economic Challenges
BEIJING — The Chinese economy is facing significant challenges, sparking concerns about its growth potential in the near future.
However, a glimmer of hope shines through in the realm of domestic tourism.
Last week’s five-day public holiday to celebrate Labour Day saw a staggering 295 million trips taken within China, according to data from the Ministry of Culture and Tourism. This marked a 28% increase from pre-pandemic levels recorded in 2019.
The Transport Ministry also reported impressive figures: 92 million rail trips, nearly 10 million air trips, and 1.25 billion highway journeys.
Meanwhile, international arrivals continue to lag, with foreign visitors entering China at only about 30% of 2019 levels. The question arises: why the disparity?
Wuzhen, a picturesque historical river town near Shanghai, stands out as one of China’s top tourist destinations, attracting visitors from all walks of life. As we wander through the charming streets lined with old bridges over flowing waterways, we encounter a bustling crowd of tourists.
One popular activity in Wuzhen is dressing up in traditional hanfu attire for photos, transporting visitors back in time.
Two young women in their 20s, friends since high school, have traveled from Jilin Province in the northeast to explore Wuzhen. After getting their hair styled in elaborate imperial-era fashion, they express admiration for the town’s classical beauty.
When asked about post-Covid travel trends among their family and friends, they respond enthusiastically, “Of course, after the pandemic, we’re all exploring new places.”
Adjacent to them, a local ice-cream vendor mentions that tourist numbers have been “not that bad lately.”
Is it as good as before Covid? “Almost the same,” he affirms.
Shop owner Wang Ying, who sells traditional snacks, mirrors this optimism with a wide grin, stating, “Business is thriving, and it will only get better.”
These positive signs bode well for the Chinese government, which has been advocating for increased domestic consumption to bolster the economy amid challenges in sectors like real estate, rising local government debt, and youth unemployment.
Despite these obstacles, the Communist Party has set a target of “around 5%” GDP growth for the year. However, doubts linger among analysts about the accuracy of official growth figures and the feasibility of achieving such a target without substantial stimulus measures.
One potential lifeline could be the flourishing domestic travel sector, offering broader business prospects and increased employment in the service industry.
Schubert Lou, COO at travel agency Trip.com, reports a significant surge in domestic travel demand, with hotel searches up by 67% and flight bookings up by 80% compared to last year.
Tourism industry consultant Peng Han from Travel Daily is closely monitoring investment trends to gauge the business community’s optimism about the sector’s potential.
“Leading international hotel brands like Intercontinental, Marriott, and Hilton are expanding rapidly in China in 2023,” he notes. “Their ambitious performance goals for 2024 indicate a strong belief in the growth opportunities in the Chinese market.”
However, despite the rise in domestic travelers, Peng highlights the challenge of low per capita consumption, attributing it to economic uncertainties driving a more frugal approach to spending.
One potential solution could lie in attracting high-spending foreign visitors, yet their numbers have dwindled compared to pre-pandemic levels.
In 2019, China welcomed nearly 98 million international tourists, whereas last year saw only 35 million arrivals, including business and student travelers. Lou describes the disparity between domestic and international markets as “uneven.”
For many in the tourism industry catering to foreign visitors, the situation is more than just “uneven.” Three years of stringent Covid prevention measures have significantly reduced international arrivals, but other factors are also at play.
Huang Songshan, head of the Centre for Tourism Research at Australia’s Edith Cowan University, points to the shifting global geopolitical landscape as a contributing factor. He references a 2023 survey by the Pew Research Centre, highlighting unfavorable views towards China in Western nations and concerns about societal regulations.
Travel advisories from various governments echo these sentiments, cautioning against travel to Mainland China due to enforcement of laws and risks of detention.
The political climate has also impacted flight availability and pricing, particularly with connections to North America. The dwindling number of direct flights between China and the US reflects this strain.
President Xi Jinping’s efforts to enhance travel facilitation and promote people-to-people exchanges with the US signal a potential shift in the tourism landscape.
Rekindling Friendship Through Travel: Challenges and Hurdles Ahead
In a bid to revive the bonds between the people of the United States and China, there is a call for increased visits, contacts, and exchanges to create new stories of friendship in the new era.
Washington has slightly eased restrictions on Chinese airline flights, allowing an increase from 35 to 50 flights per week. However, this is still far below the pre-Covid 150 weekly trips.
The Biden administration is facing pressure from unions and US airlines to refrain from further increasing the number of Chinese airline flights. They argue that Chinese airlines have an unfair advantage due to state support, less stringent regulations, and the ability to fly over Russian airspace, making trips more efficient and cost-effective.
Concerns have been raised by Mike Gallagher and Raja Krishnamoorthi, urging the US government to address these issues before expanding the US-China passenger carrier market. Failure to do so could result in negative consequences for US aviation workers, travelers, and airlines.
The impact of limited international flight connections is already being felt, with projections showing that inbound flight capacity may not reach 80% of 2019 levels until the end of 2024.
One major hurdle for travelers in China is the reliance on state-of-the-art phone app payment and booking systems. While efficient for Chinese citizens, these systems can be complex and inaccessible for foreigners, leading to challenges in accessing certain sites, transportation options, and purchases.
Professor Chen Yong highlights the importance of bridging the gap in technology access for foreign tourists in China. Language barriers and differences in user habits can hinder the tourist industry’s growth.
Despite the challenges, efforts are being made to attract more foreign visitors to China. Initiatives such as visa-free entry for citizens of certain countries and improved credit card acceptance in hotels and taxis aim to boost tourism numbers.
However, Professor Chen remains cautious about long-term growth in China’s inbound tourism, emphasizing the need for a cultural shift in service providers’ mindset towards foreign tourists.
As destinations like Wuzhen work to attract both local and international travelers, the hope is that the allure of unique sites and experiences will eventually outweigh the hurdles faced by foreigners traveling in China.
