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China: Time to calm down and rethink

The increasing rate of inbound travel in China has been going down for three years since 2010, which, according to statistics, decreased 4.06% year-on-year during the period January to May 2013. With the highest ranking on overseas spending and the title of largest market sources, it is time that China rethink and focus back on its inbound travel market.

CHINA – The number of inbound tourists as recorded from January to May this year was 22.93 million, showing a decline of 4.06% year-on-year. “This was a period that we saw a relatively big decrease during the last decade” said Zhu Shanzhong, Deputy Director of the National Tourism Administration of China.

Chinese major markets such as Korea, Japan, Russia and USA all reported a lower figure compared to past years, among which, the number of Japanese tourists hit a lowest point at about 1.2 million, dropping 24.54% year-on-year. Negative results were also seen in Malaysian, Singaporean, Thai, etc. markets.

Zhu Shanzhong admitted that although national and local tourism bureaus had done considerable work to boost inbound travel, results seemed to be far under expectation. He said: “Our inbound travel is now facing a dilemma, markets far away are not able to come while those nearby are shrinking gradually.”

Adverse factors which result in this situation initially come from recession of the world economy – Europeans are heading to local and nearby destinations instead of traveling a long way to other countries. Secondly, RMB appreciation and the raising of CPI are weakening the price advantage of Chinese tourism products. Besides, after Bird Flu, the haze, Ya’an Earthquake, etc. countries such as Korea, Japan and many European nations all put alerts on China as a destination.

Considering subjectively, single marketing and promotion approaches, businesses’ lack of motivation, lag of product design and exploitation, etc. are all handicaps to blame.
Last but not least, voices are also heard from many analysts that China should further ease its visa policies to simulate and attract overseas tourists since there are only four countries that benefit from Chinese visa-free policy.

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