Recent Trends in Chinese Tourism

Travel Sentry News | September 2024

Recent Trends in Chinese Tourism Performance

Domestic Tourism

In 2023, Chinese domestic tourism made a strong comeback. Travelers took 489 million trips within the country, generating RMB 4.9 trillion (US$679 billion) in revenue. This marks a five-year high in spending per domestic traveler, even surpassing pre-pandemic levels.

This growth in internal tourism reflects strong demand for local trips. Many Chinese travelers now prefer domestic options because of better services and value for money. Experts predict that domestic tourism will continue to grow and surpass pre-pandemic levels by the end of 2024.

Outbound Travel

Outbound travel has recovered more slowly. In 2023, Chinese outbound travel hit 101 million cross-border trips, which is just 60% of what it was in 2019. Many of these trips went to nearby places like Hong Kong, Macau, and Taiwan.

Travel to other countries has been slower to bounce back, only reaching 36.3% of pre-pandemic levels. However, countries like South Korea, Australia, and Singapore, which reopened earlier, saw better recovery, with over 65% of Chinese tourists returning.

Inbound Tourism

China’s inbound tourism is making a comeback in 2024, reaching 85% of pre-pandemic levels during big holidays like Golden Week.

China, as one of the largest outbound travel markets and a major tourist destination, is playing a key role in the global travel recovery. Countries with visa-free entry agreements, such as Thailand, Singapore, and Malaysia, have seen big increases in Chinese tourists visiting these travel destinations.

Obstacles to Outbound Travel Recovery

There are several reasons why Chinese outbound travel is recovering slowly:

Economic Issues:

• The COVID-19 pandemic impacted household finances, making it harder for people to afford international trips.
• The lower value of the RMB and higher travel costs, including inflation in popular tourist destinations, have made international trips more expensive.
• Domestic tourism is more affordable and offers good value, reducing the need for many travelers to look outside the country.

Policy Challenges:

• Difficult visa processes and geopolitical tensions make travel planning harder.
• Government restrictions on “non-essential” outbound travel, especially for those working in state-owned companies, have further limited travel.

Future of Chinese Outbound Tourism

Even with these challenges, experts expect Chinese outbound travel to recover in 2024. They predict that:

• Travel spending will recover faster than the number of tourists. This is due to higher travel costs and the fact that wealthier travelers are less sensitive to price hikes.
• Lower inflation and a stable RMB will encourage more Chinese travelers to explore popular travel destinations.
• More flights, especially in the Asia-Pacific and Middle Eastern regions, will drive further demand.

However, high youth unemployment remains a problem. Young Chinese travelers make up a big part of the market, so job insecurity may continue to slow down recovery.

Long-Term Prospects

In the long term, Chinese outbound tourism will grow, driven by rising incomes. Experts predict that spending on travel and tourism will increase, but at a slower rate than in the 2010s. With only 14% of adults holding passports, there is still a huge potential market for international travel.

There is also a shift from shopping to cultural and experience-focused travel. For example, Chinese tourists in Japan are now spending more on accommodation and entertainment and less on shopping. This trend shows a growing interest in authentic, local experiences among Chinese travelers.

Visa-Free Agreements and Regional Travel

Visa-free agreements have been crucial in boosting outbound travel. Countries like Thailand, Singapore, Malaysia, and the UAE have seen a rise in Chinese tourists due to these easier travel processes. For example, Singapore experienced a 45% increase in Chinese travelers during Chinese New Year 2024.

Regional travel to places like Hong Kong, Macau, and Taiwan remains popular, benefiting from easier travel policies and proximity. This regional trend shows how important inbound tourism and regional travel will be in recovery.

Inbound Tourism and Domestic Travel Preferences

The rise in domestic tourism has changed travel preferences. More Chinese travelers are valuing the convenience and cost-effectiveness of internal tourism. Popular tourist destinations like Hainan Island have seen more luxury and experiential travel as Chinese tourists look for high-quality domestic experiences. As inbound tourism continues to recover, this shift will influence both domestic and international markets, especially during busy travel periods like Golden Week.