Domestic tourists provide Chinese economy with a boost

Traffic, loud conversations on the street and even dog walkers once irritated Dongdong. But in the three months that she spent in lockdown in Wuhan, the 27-year-old marketing executive longed for the noises of everyday life.

“I used to find those sounds annoying but I’ve been missing their vibrancy and cheerfulness,” said Dongdong, who asked to use a pseudonym.

Dongdong travelled from Wuhan, where the coronavirus pandemic originated, back to work in Beijing, where she completed her mandatory two-week quarantine in time for the May Day break, the longest national holiday since restrictions were eased. On her first meal out in three months, she was thrilled to hear the familiar hubbub of her neighbourhood.

During the holiday, 115m people made domestic tourism trips, contributing Rmb47.6bn ($6.7bn) to tourism revenue, according to government figures. That marks a big increase from the 43m trips made during the three-day Qingming holiday a month earlier, suggesting residents’ confidence in the government’s epidemic controls 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 legislative session. The parliament is usually held in March but was postponed to late May because of the pandemic.

Preliminary data from STR reveal a big rise in hotels’ occupancy and average daily room rates from the start of the holiday, with daily rates 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.”

However, the figures also confirm that China still has a long way to go to recover economically from the epidemic: last year 195m May Day trips were logged.

Tourism contributed more than 11 per cent to China’s economy in 2019, and is a cornerstone of the government’s long-term goal 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.

She added that tourism revenue generated over the May Day break was down by about 60 per cent from a year ago.

People are still avoiding flights, analysts pointed out, owing to the greater risks of infection — but car trips have become more attractive.

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

Children celebrate the May Day break by playing in fountains in the Sanlitun shopping centre in Beijing 

Children celebrate the May Day break by playing in fountains in the Sanlitun shopping centre in Beijing  © Tingshu Wang/Reuters

But international travel remains out of the question for most Chinese tourists, according to Tao Wang, head of Asia economics at UBS in Hong Kong.

“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 said, adding that many foreign governments had imposed entry restrictions.

That is unwelcome news for western tourism boards and airlines, which have been boosted by Chinese tourism. According to the US National Travel and Tourism Office, 2.8m Chinese tourists visited America last year, while the China Tourism Academy said more than 6m Chinese tourists visited Europe in 2018. 

Beijing’s domestic tourism surge, however, illustrates the dilemma faced by the government, which is trying to revive the economy but prevent another wave of infections.

Municipal Beijing officials, for example, announced they were taking measures to expand consumption and revive market confidence, while also making sure shopping malls were no more than half full.

Over the break, local tourist attractions such as the Forbidden City opened for the first time since the epidemic, but the number of entrance tickets was capped, while businesses were asked to conduct holiday sales online rather than in-venue.

While Dongdong is happy to be out of doors, her life has yet to return to normal. Her Beijing friends decided against inviting her on a holiday biking trip because they were afraid she had carried the virus from Wuhan, where officials insist the risk of infection is low.

Editor’s note

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Back in Wuhan, 28-year-old Xu Zhuo is still worried. Despite taking a May Day trip with her mother every year for the past decade, she decided to scrap this year’s outing.

“Even though the city has been liberated, I don’t feel safe going out,” said Ms Xu. “The past three months have given me PTSD and I don’t know when I’ll feel comfortable being out and about again.”

Ms Xu trusted her own protective measures — always leaving the house with a mask, disposable gloves, goggles and a bottle of hand sanitiser — but said she was unconvinced other residents took the same precautions.

“I think the outbreak has brought out trust issues among all of us. I don’t talk to my neighbours, the friendly guards out front, or the grocer who always gave me more than I paid for any more, because I can’t be sure of their health,” Ms Xu said.

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