China lifted a ban on group travel to a slew of countries including the US, UK, Australia, South Korea and Japan, in a major relaxation of travel restrictions that could boost the global tourism market. Tourism and travel stocks in the region surged.
(Bloomberg) — China lifted a ban on group travel to a slew of countries including the US, UK, Australia, South Korea and Japan, in a major relaxation of travel restrictions that could boost the global tourism market. Tourism and travel stocks in the region surged.
The resumption of group tours will start immediately on Thursday, according to a statement issued by the Ministry of Culture and Tourism. The easing applies to all travel agencies and online platforms across the country, it said.
The move could accelerate a recovery in the global tourism industry, which has been sluggish amid a slow rebound in flight capacity to and from China, one of the largest sources of tourists before Covid. Slowing economic growth has also hampered a comeback in outbound tourism as many Chinese prefer to stay at home in an enduring Covid—era shift.
Tourism stocks climbed. In South Korea, Hotel Shilla Co. jumped 18%, its biggest intraday gain since listing in 1991, while casino firm Paradise Co. surged more than 20% and package tour operator Lotte Tour Development Co. rose 29%. Japanese department store firm Isetan Mitsukoshi Holdings Ltd. was 5% higher and Japan Airport Terminal Co. jumped as much as 12%. Airline stocks posted more muted gains, with China Southern Airlines Co. up as much 3.5% in Hong Kong trading.
One of the big beneficiaries is likely to be Japan. In 2019, Chinese tourists accounted for about one third of Japan’s international visitors, spending more than $12 billion in the country — the highest among all overseas markets, according to data from the Japan National Tourism Organization. In the first half of this year, the number of Chinese travelers in Japan only returned to 13% of the pre-pandemic levels.
The recovery in China’s international aviation market has also been slow. Domestic flight capacity has reached 17% above pre-pandemic level in July, but international capacity is still about half of 2019 level, data from aviation analytics company Cirium shows.
Since China reopened from three years of Covid Zero curbs at the start of the this year, the country has resumed group tours to dozens of countries across Asia, Africa, Europe and South America. But bans on countries like the US, UK, Australia, South Korea and Japan have been maintained until now amid geopolitical tensions.
Still, it’s unclear how far the easing on group tours goes in thawing tensions. While China has welcomed a stream of high-profile foreign visitors in recent months, some overseas investors and business people traveling to the nation for the first time since the lifting of pandemic restrictions said the environment has grown more hostile to foreigners, Bloomberg News has previously reported.
Beijing has ramped up its national security campaign rolling out new training on keeping secrets and a revised anti-espionage law that state employees say have dampened willingness to engage candidly with those coming from abroad.
Read more: Investors Visiting China Find Officials Fearful of Upsetting Xi
–With assistance from Jinshan Hong, Danny Lee and Rebecca Choong Wilkins.
(Updates to add details throughout.)
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