Lessons from China’s ‘golden week’ lustre even amid Covid-19

If the outbreak of Covid-19 in Wuhan soon before the Lunar New Year holiday accelerated its spread nationwide and globally, Chinese holidaymakers enthusiastically consuming and travelling during the October “golden week” signalled the pandemic being under firm control within mainland China. Consumer retail and restaurant spending during the long National Day holiday exceeded last year’s. But the 637 million travellers were still 21 per cent below 2019’s level.

However, this must be seen in the context of a 65 per cent drop globally in international tourists in the first half of this year. International arrivals to New York are more than 90 per cent below the pre-pandemic level. Foreign tourists will spend 75 per cent less in the US this year. US travel industry revenue is expected to drop by US$505 billion, 45 per cent less than 2019.

In recent years, China has been the world’s top tourism spender but only its 10th earner. Thus, China’s lost inbound tourism revenue may be partly replaced by potential outbound tourism spending being redirected to the domestic market. China’s strong consumption figures during the October holiday reaffirmed its remarkable all-round economic recovery.

So far, the mass movement of people does not seem to have resulted in renewed Covid-19 outbreaks in China. How is this possible in the middle of a global pandemic? Having eradicated domestic transmission of Covid-19, mainland China is now the world’s largest “Covid-19 safe” bubble.