Despite domestic travel deterrents, Chinese New Year tourism to continue, says GlobalData

Despite cash incentives to stay home, extensive testing requirements and the launch of digital parades,  many Chinese tourists are still likely to travel for the Chinese New Year – the largest and most widely celebrated event across the country, says GlobalData, a leading data and analytics company.

The last ‘normal’ year (2019) for tourism in China witnessed 999 million domestic trips taken for visiting friends and relatives (VFR) purposes. This accounted for 31.7% of total domestic trips.

According to GlobalData, 2020 saw this decline by 26.3% due to COVID-19 and the consequent national travel restrictions. In December 2020, general sentiment was positive regarding the control of COVID-19 in the country and domestic travel demand was fairly buoyant*, so a virtual parade or celebration will likely not be enough to satisfy individuals’ desire to see in the new year without friends and family.

Johanna Bonhill-Smith, Travel & Tourism Analyst at GlobalData, comments: “General consumer sentiment towards China’s handling of COVID-19 was positive in GlobalData’s most recent COVID-19 Recovery Survey in December 2021*. The survey suggested that 66% of Chinese respondents (from a total of 500) saw the COVID-19 situation getting better whilst 24% saw it staying the same and only 10% saw it getting worse. Since then, there have been a few minor outbreaks in rural areas but overall, China remains one of the least affected countries worldwide.

“City breaks, sun and beach holidays and cultural getaways are typically the most popular forms of travel for Chinese tourists**, but the Lunar New Year is a pivotal moment for VFR travels in the national calendar. In December 2020, 57% of Chinese respondents were confident of booking a domestic trip and only 30% declared they would consider reducing their domestic travel plans in the ‘new normal’* suggesting domestic demand remained fairly positive in the build-up to this festive period.”

To fight off the threat of a potentially ‘super spreader’ event, the Chinese Government has not launched a blanket travel ban for all domestic travel but has instead looked to extensive testing and quarantine requirements. Certain individual states have then offered cash incentives to spend locally rather than traveling across the country. The City of Hangzhou for example is offering 1,000 yuan (US$154) to migrant workers and the City of Yiwu launched free admission to cultural venues/facilities. Other cities are launching shopping coupons, discounted rent and potential early access to COVID-19 vaccines if residents opt to stay local.

If concerns were dire regarding personal financial situations, Chinese tourists may be persuaded to opt for a cash incentive to stay put during the New Year period. However, between 2–6 December, only 9% of Chinese respondents saw their personal financial situation getting worse, whilst 47% saw this improving*. Not as concerned by financial constraints, this may lead many to still travel for VFR after time apart during 2020.

Bonhill-Smith concludes: “Certain measures have been introduced to deter Chinese tourists from traveling during this festive period but it remains clear that domestic travel demand is still fairly confident. Whilst some may opt to stay put, many are likely to still travel across the country after a difficult year in 2020 and welcome the new year surrounded by close relatives.”

(*) GlobalData’s latest China COVID-19 Recovery survey (2nd-6th Dec 2020) – 500 respondents

(**) GlobalData’s Q32019 China & Global consumer survey – (China: 900; Global: 29,744)

More Media