Chinese outbound tourism recovery to be slower than expected: Nomura
A report by banking group Nomura has warned that “sizeable headwinds” will continue to hinder the recovery of outbound Chinese tourism in 2024 and possibly beyond.
China.- A recent report from Nomura, a banking group, has highlighted that the recovery of outbound overseas tourism from China is likely to face significant headwinds in 2024 and possibly 2025.
According to analysts, China’s currency, weak compared to other currencies, along with the domestic economic situation, limited income growth, and high youth unemployment, are affecting the demand for outbound travel among Chinese consumers.
Nomura’s report also states it’s expected that cross-border flights will recover to 73 per cent of 2019 levels by the end of 2024, up from the current level of 57.9 per cent (as of November 2023), with an average recovery rate of 67 per cent for full-year 2024.
Nomura also anticipates that spending by outbound Chinese tourists will fully recover to 100 per cent of 2019 levels for the full year 2024.
In 2019, Chinese tourists made 155 million overseas visits, spending US$255bn, as reported by China Daily, citing data from the China Tourism Academy and the United Nations World Tourism Organization (UNWTO).
However, Nomura’s assessment suggests that outbound tourism recovery from China won’t fully recover until 2025, with a more cautious view on China’s economic performance than before, given recent data for outbound tourism from China to regional destinations, including Singapore and Thailand.
Nomura’s report also highlights that the recovery of international flights to ASEAN countries (Singapore, Malaysia, the Philippines, Thailand, Vietnam, and Indonesia) has been poor over the past two months, with flights to the aforementioned countries recovering to only 58.1 per cent of 2019 levels in December, up marginally from the 56.0 per cent in October.
Nevertheless, Singapore remains the best-performing ASEAN nation in terms of flights from China, with its recovery rate reaching 81.6 per cent of 2019 levels in December, up from 78.2 per cent in October.
