Japan’s Chinese tourist boom slows amid simmering tensions

Chinese visitor growth to Japan slowed in November to its weakest pace in nearly four years, as Beijing curbed travel amid rising tensions over Prime Minister Sanae Takaichi’s remarks on Taiwan. Arrivals from China rose just 3% from a year earlier to 562,600 — the slowest increase since January 2022, according to a statement by the Japan National Tourism Organization. Overall, inbound traffic climbed 10% year-on-year, it said. The slowdown offers the clearest sign yet that geopolitical tensions are beginning to reshape Japan’s tourism outlook. Beijing’s advisory discouraging travel to Japan and its directive for airlines to cut flights through March 2026 raise the risk of a prolonged downturn. JNTO noted that demand from China typically eases during this month, but the latest slowdown was compounded by the Chinese government’s warning against travel. Japan had otherwise been enjoying strong growth in Chinese tourism, with arrivals more than doubling last November compared with the year before. The increase in overall arrivals was driven by visitors also from South Korea, Taiwan and the U.S. South Korea remains Japan’s largest source of tourists, followed by China, Taiwan and the U.S., respectively. Still, China’s pullback carries outsized weight. Chinese travelers are Japan’s biggest spenders, accounting for a fifth of the nation’s 8.1 trillion Japanese yen ($52.4 billion) in tourism revenue. Their retreat hits an economy where population decline leaves tourism as one of the few reliable growth engines. Japan could lose 1.2 trillion Japanese yen ($7.7 billion) in tourism revenue next year if travel freezes persist, according to Hiromu Komiya, an economist at Japan Research Institute. Corporate sentiment splits over China travel impact China travel curbs are splitting corporate sentiment. About 40% of firms — mainly in retail, food services, lodging and tourism — report negative effects, while another 40% see little to none, a December Teikoku Databank survey of over 1,000 companies found. Osaka, Japan’s second-largest economic hub and a key tourism gateway for Chinese tourists, is seeing the sharpest fallout. Kansai International Airport has logged the steepest flight cuts nationwide. Bookings for Osaka-bound trips from China for winter and early spring departures are down 55% to 65%, a deeper drop than the national average, marketing researcher China Trading Desk said. Luxury spending by Chinese visitors in Osaka is projected to fall roughly by half to $40 million to $60 million a month. Retailers are feeling the shift immediately. Isetan Mitsukoshi Holdings said duty-free sales fell around 20% in the first two weeks of December from a year earlier, while overall sales slipped around 2%. Matsuya’s Ginza flagship store duty-free sales fell about 15% last month from a year earlier, compared with a 1.2% dip in overall sales. Regional diversification efforts show early results Some companies expect conditions to stabilize as Japan gradually reduces its reliance on China and overtourism concerns ease, the Teikoku Databank survey found. Japan has also been pressing regional destinations to diversify their visitor mix since post-pandemic reopening. Progress is uneven but evident. In Gifu, Chinese guests now make up 10% of stays, down from 41% in 2019, according to government data. In Shizuoka, that number has fallen to 45% from 71%. By Kanoko Matsuyama

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Japan’s Chinese tourist boom slows amid simmering tensions