China still awaiting inbound travel surge, but flight resumption should help oil the wheels
- Trips into China had not yet reached half their pre-pandemic levels by the third quarter, but direct flight resumption should pick things up next year
- Flights from the US, slow to resume amid geopolitical tensions, are expected to increase after leaders’ meeting at Apec summit
Although travel flows into China for the third quarter were just 45 per cent of the same period in pre-pandemic 2019, retailers should see more tourism revenue by next year as flights increase, Beijing-based investment bank China International Capital Corporation (CICC) said on Monday.
“The number of inbound tourists and consumption has gradually recovered in 2023,” the partially state-owned firm said via WeChat.
CICC forecasts an “improvement of economic activities” and a “resumption of international flights” next year, leading to a possible 2024 domestic retail sales growth of 0.2 percentage points and one to two percentage points more in exports.
The potential for a comeback is quite large
International tourism revenue for the July-September quarter in 2023 had regained about 59 per cent of revenue for the same period in 2019, the firm said.
“The slow recovery of inbound tourists and consumption is partly related to the slow recovery of the economy, and may also be related to the number of international flights,” the bank said.
An absence of international visitors has slowed the recovery of the multi-trillion yuan service industry linked to domestic travel.
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