How China is restoring its tourism industry after three months in lockdown

The May Day break has been China’s longest national holiday since the lockdown was lifted. Across the holiday, 115m citizens made domestic tourism trips, contributing Rmb47.6bn ($6.7bn) to tourism revenue, according to official data.

It represents a big spike from the 43m trips made during the three-day Qingming holiday a month earlier, indicating peoples’ trust in the government’s pandemic response has risen.

“With the national congress now scheduled there are strong signals of confidence in China for sure,” said Jesper Palmqvist, Asia-Pacific director of tourism data group STR, referring to the country’s annual rubber-stamp lawmaking conference.

The session normally takes place in March but was adjourned to late May because of the outbreak.

Initial figures from STR show a big hike in hotels’ occupancy and average daily room rates from the start of the holiday.

Daily rates were almost doubling from the past few weeks.

Jian Chang, chief China economist at Barclays Investment Bank in Hong Kong, said: “The public confidence has now rebounded to a reasonable level as Chinese nationals see the government’s ability to bring the outbreak under control.”

But the data also shows that China still has a long way to go to restore its economy from the pandemic: last year’s records show 195m May Day trips were made.

In 2019, tourism contributed more than 11 percent to China’s economy.

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Growth in tourism is essential to China’s long-term plans to create a consumption-driven economy.

“As one of the hardest-hit sectors by the outbreak, China’s tourism still remains deep in contraction year on year,” said Ms Chang.

“The strong desire to ‘get a breath’ will likely benefit intracity and interprovincial tourism initially,” Ms Chang said.

But international trips are still unattainable for most Chinese citizens, according to Tao Wang, head of Asia economics at UBS in Hong Kong.

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Ms Wang said: “It is highly unlikely that people in China will be ready to travel abroad soon.

“Even if there is the intention, they can’t, with China severely cutting down international flights.”

Ms Wang added that many foreign governments had enforced entry restrictions as a prevention from further risks of contagion.

Data from the US National Travel and Tourism Office shows 2.8m Chinese citizens travelled to the US last year.

The China Tourism Academy revealed that over 6m Chinese nationals travelled to Europe in 2018.

However, the increase in domestic tourism in China only highlights the government’s predicament between reviving the country’s economies ad saving lives from a potential second outbreak.

Municipal Beijing officials revealed that they had plans to broaden consumption and restoring market confidence, while ensuring shopping centres where below half full to avoid triggering a second wave of the virus.

Over the holidays, national tourist hotspots such as the Forbidden City reopened to the public, however the number of tickets on sale was limited.

Businesses encouraged buying tickets online instead of in person.

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