Chinese tourist spending boost to the economy
China’s tourism spending surpassed pre-pandemic levels for the first time, signifying an economic boost since China ended its coronavirus containment policy.
This week’s Labor Day trip has been closely watched as an indicator of China’s economic recovery, which policymakers hope will help spur growth amid a flat export outlook after a disappointing year.
According to the Ministry of Tourism, China recorded 274 million domestic trips in five days, up 19 percent from 2019.
Total tourism receipts hit $21.5 billion, a sharp year-over-year increase, marking the first time leisure tourism receipts surpassed pre-pandemic levels.
The figures show a marked improvement in travel and spending compared to recent holidays, such as the Lunar New Year in January, which have been hit by a wave of infections in the country’s biggest cities.
China’s economic growth targets
Outbound travel was also well below 2019 numbers as limited international flights curbed Chinese tourists’ willingness to go abroad.
Chinese policymakers have set a target of 5 percent growth by 2023, the lowest in decades, after the economy grew by just 3 percent last year.
But many analysts expect this year’s target to exceed their forecast of 6 percent growth.
While domestic travel picked up in early May, outbound travel remains close to pre-pandemic levels as authorities only recently resumed issuing travel visas and passports.
After the collapse of regional banks Silicon Valley Bank, Signature Bank, and First Republic, bank security is also a concern for small business owners.
More than 60% say they bank with community or regional banks. Most surveyed owners say their business capital is secure. Still, nearly half say it’s not easy to access capital to operate.