What happened
After almost three long years, the mainland is reopening its borders and dropping quarantine for inbound travelers, starting on January 8th. After dropping its Dynamic Zero Covid policy mid December, China is now in the midst of a Covid wave across the country. Although it is not issuing tourist visas yet, the latest big change will mean that Chinese residents will be able to travel to the rest of the world and return fairly easily and without quarantine - just a negative PCR test is required 48hrs before entering China. Chinese travel sites reported a boost in searches upon the announcement.
Hong Kong has also canceled its strict COVID rules today, with PCR tests for arrivals and vaccine passes dropped across the city, although the public mask mandate remains. Chief Executive John Lee said that there are preparations for opening the borders with the mainland on the 15th January 2023.
The Jing Take
This latest news provides hope for the global economy. Tourism, hospitality, retail and luxury industries all around the world will be particularly delighted to hear of the potential lift resulting in the return of the Chinese tourist. Fashion and luxury brands no doubt have new cause for celebration.
French officials have already issued an official statement welcoming Chinese tourism back. However, countries like Japan, Italy and Malaysia have announced the implementation of testing measures for incoming flights from China due to the high rates of Covid sweeping across the country, whilst US officials have also indicated similar concerns as well as lack of transparency on numbers.
Japan and Hong Kong both top Chinese traveler sentiment wish lists, as reported by a recent Dragon Trail Research’s report, and 38 percent of respondents plan to travel within six months. 2023 is likely to be characterized by revenge spending and revenge travel by the Chinese, whose collective cabin fever over the past three years has reached boiling point.
Data from Chinese online travel companies show several trends: Qunar.com showed a five-fold increase in outbound ticket bookings within an hour of the news, with most departures between mid-January and early February; with Tokyo, Seoul, Bangkok and Hong Kong amongst the most popular destinations. Trip.com Group indicated that outbound ticket orders rose 254% from the same period on Monday morning. LY.com saw an 850% increase in international ticket searches, while visa searches jumped tenfold, with Japan, South Korea and Thailand being the top three destinations. Most of those searching for outbound travel are from Shanghai, Beijing and Guangzhou.
The desire for new experiences, new countries and new environments is sky high, but Chinese travelers have also emerged out of the last three years with a newfound consciousness for sustainable travel, health and safety, as well as more meaningful consumption. Whilst Asian destinations seem to be most popular right now, brands and retailers in favored luxury destinations like Paris, Milan and London must also be prepared for a busy year of rebound and spending.
The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.