Chinese economy ‘still showing Covid scars’ despite ‘golden week’ travel surge
- The number of tourist journeys increased compared with the Covid era but the daily average is below pre-pandemic levels, according to travel industry insiders
- One analyst points to the drop in road travel, saying it paints a ‘quite alarming’ picture of sentiment among lower income groups
According to data from the Ministry of Transport, 458 million passengers travelled by road, rail, water and on domestic flights during the eight-day holiday – a 57.1 per cent increase compared with last year, when stringent Covid controls were still in place.
The first National Day holiday since China abandoned its zero-Covid restrictions in January overlapped with Mid-Autumn Festival, making it a rare eight-day holiday.
News and social media posts were widely circulated about the swarms of tourism packing major cities across the country and train tickets being sold out instantly.
However, Zhou Mingqi, founder of tourism consultancy Jingjian Consulting, said it was more informative to compare it with pre-Covid years.
This year, the daily average number of travellers stood at around 66 per cent of the 2019 figures.
“Looking at the detailed analysis of the data, the main issue appears to be with highway traffic,” Zhou said.
China’s travellers yet to regain pre-pandemic appetite for overseas trips
The seven-day National Day holiday in 2019 saw 490 million highway passengers while the eight-day holiday this year saw 290 million, according to official data.
“When it comes to highway passenger travel, it largely involves people with relatively lower incomes or limited spending capacity who choose long-distance bus travel. Therefore, the emergence of a nearly 50 per cent contraction in this group is quite alarming,” Zhou added.
In a report published on Friday, Larry Hu, chief China economist at Macquarie Group, wrote that the recovery in consumption was on track.
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“[But] the scarring effect caused by the pandemic has not completely gone away, as spending per tourist is still below the 2019 level,” he said.
China has set an annual economic growth target of around 5 per cent, but the country’s economic recovery has been subdued as consumers remain cautious about spending in the face of widespread concerns about job losses or pay cuts.
According to data from the Ministry of Culture and Tourism, during the eight-day holiday period, there were a total of 826 million domestic tourists – a 71.3 per cent jump on the comparable period last year or a 4.1 per cent increase compared with 2019.
Total domestic tourism revenue reached 753.4 billion yuan (US$104.7 billion) this year, reflecting a year-on-year increase of 130 per cent in comparable terms, and a 1.5 per cent growth compared with 2019.
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“This means the per capita spending returned to 98 per cent of 2019 level, sizeably higher than previous holidays this year. This is likely due to an extra-long golden week holiday (eight days v seven usually), which encouraged long-distance travel and thus boosted average spending,” according to a report by Morgan Stanley published on Saturday.
