The number of foreign visitors to Japan recovered to 86% of pre-pandemic levels in August with Chinese tourists adding a boost, according to Japan’s National Tourism Organization.
(Bloomberg) — The number of foreign visitors to Japan recovered to 86% of pre-pandemic levels in August with Chinese tourists adding a boost, according to Japan’s National Tourism Organization.
The number of visitors was about 2.2 million, compared with 2.52 million in August 2019, the organization reported on Wednesday. The number of Chinese visitors was 364,100, a 16% increase from July, after China ended its ban on tour groups to Japan last month. That compared with a little over 1 million in August 2019.
Doubts had simmered over the recovery in Chinese visitor numbers, after Japan’s release of treated wastewater from the wrecked Fukushima nuclear plant triggered fear and anger in China. Beijing slapped a ban on Japanese seafood imports and there were social media calls for a boycott of Japan’s goods more generally. China’s post-pandemic economic recovery this year has also been weaker than expected.
Visitors from other nations like the US and South Korea continued to exceed 2019 levels, with tourists from South Korea jumping 84% last month, still outnumbering the Chinese.
Inbound tourism, counted as an export of services, has been a bright spot in Japan’s economic recovery as a weaker yen boosts the spending power of visitors from abroad. Their outlays during the quarter through June recovered to 1.2 trillion yen ($8.1 billion), or 95.1% of the same period in 2019, before the pandemic.
Spending was led by tourists from Taiwan, the US, China and South Korea, with Chinese outlays accounting for far less than before the pandemic, according to the Japan Tourism Agency. The data also showed that spending per visitor exceeds pre-pandemic levels.
In the second quarter of 2019, the yen traded around 110 to the dollar on average, compared to the roughly 137 level seen this year — a move that has essentially created a 25% discount on everything in Japan for dollar earners. Similar moves have been seen against the euro, yuan and Korean won.
Prime Minister Fumio Kishida aims for inbound spending to reach an annual 5 trillion yen as soon as possible. That would exceed the record 4.8 trillion yen seen four years ago.
To increase tourist spending, Japan should focus on entertainment services, including local tours, theme parks, theater and music, said Naoko Kuga, a senior researcher at NLI Research Institute in a report last month. The night-time economy and services for wealthy visitors in particular have room to grow, she said.
Meanwhile, exports of goods fell in August for a second month due to economic slowdowns abroad, clouding the outlook for Japan’s economy in the third quarter, as companies and households cut back on spending.
–With assistance from Isabel Reynolds.
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