Since China reopened its borders in 2023 after three years of Covid isolation, domestic transport has flourished and high-speed rail has become increasingly popular. But international travel in and out of the country is lagging, and flight capacity is still only a third of pre-pandemic levels.
The economic stakes are high. According to the United Nations World Tourism Organization, Chinese travelers were the world's biggest spenders before the pandemic, accounting for 20 percent of global tourism spending.
Over the past year, Chinese authorities have tried to encourage more inbound travel. The changes include: China has waived travel visas or agreed to extend the duration of visa-free travel for visitors from eight countries, including Germany and France.
The main factor holding back Chinese international travel will continue to be the Chinese economy. Growth has recovered from the pandemic, but the burden of a severe real estate downturn has dampened consumer spending and confidence in China. And global geopolitical tensions remain a wild card. China is embroiled in trade disputes with the United States and Europe, where many large multinational companies are based. As they think twice about their business in China, travel suffers.
Here's what you should know about the state of China's travel economy.
Travel to China has almost come to a standstill due to the pandemic. There will not be a full recovery until 2025.
During the pandemic, China has enforced some of the strictest travel rules in the world. Travelers from overseas who managed to enter the country sometimes had to be quarantined for up to two months at their own expense.
According to OAG, a flight data analysis company, international flight capacity – essentially the number of seats available on flights to and from China – in December was just 62 percent of what it was in December 2019. But domestic traffic has increased: the three-day weekend at the end of last month exceeded that The number of these fliers is almost 10 percent higher than before the pandemic.
At the start of last year, there were only about 500 international flights per week in China, according to the Civil Aviation Administration of China, the aviation regulator. There are currently about 4,600, and that number is expected to rise to 6,000 by the end of the year – about 80 percent of pre-pandemic levels.
A big test will come next month during the Spring Festival around the Lunar New Year, typically a high-travel period when millions of workers head to their hometowns. Chinese airlines will schedule 2,500 additional international flights to accommodate Spring Festival visits, China's aviation regulator said last week.
China's transportation officials said they expected 480 million rail trips to be taken during a 40-day period of travel around the Spring Festival in the weeks before and after the Lunar New Year, an increase of nearly 40 percent from last year.
The high-speed train has become an increasingly popular means of transport within the country. China State Railway Group, the national rail operator, said that the number of rail trips exceeded 20 million at the start of Golden Week in October, a peak, and that the average daily number of passenger trips throughout the year was 10 million have exceeded.
Most analysts expected that the full recovery in international travel would not occur until 2025.
In a January research note, economists at Japanese bank Nomura said the pace of the sector's recovery largely depends on how much Chinese travelers are willing to spend. Pandemic-era issues such as delays in issuing visas and passports that lasted until 2023 have been resolved.
“While supply-side constraints eased, strains on the demand side are now beginning to take effect, and significant headwinds remain to the recovery of Chinese outbound tourism in 2024 and possibly 2025,” Nomura economists wrote.
Applying for a visa and traveling to China are a little more straightforward.
In December, China began allowing visitors from France, Germany, Italy, Spain, Malaysia and the Netherlands to travel visa-free for 15 days, a change said to be in effect until November 2024. China's national immigration agency said 147,000 visas were issued in China in the first six and a half weeks of the program. China has also made arrangements to make visa-free travel more accessible to tourists from Thailand and Singapore.
For Americans, visa applicants are no longer required to submit documents such as hotel booking documents, travel plans or invitation letters. The authorities have also reduced all visa application fees by 25 percent until the end of the year.
It has also become easier for foreigners to pay for things when visiting China. Last July, major payment platforms WeChat Pay and Alipay announced they would support foreign credit cards and allow visitors to pay like locals. China has been moving away from paper money and coins, a trend that has accelerated during the pandemic.
Flights between China and the US have been slow to resume. Before the pandemic, there were more than 300 flights between the two countries every week. That number was 36 per week in September and has been gradually increasing. In November, the countries agreed to increase flights to 70 per week.
Geopolitical tensions and cautious Chinese travelers could threaten the sector's recovery.
Tense Sino-American relations will continue to lurk in the background of international travel to China.
The US State Department maintains a “Level 3” travel advisory for China, warning Americans to “reconsider travel” to the country due to, among other things, “the risk of unlawful detention.”
China's foreign ministry has issued its own travel notice warning that travelers to the United States are being “harassed and interrogated at the border under various pretexts” and that Chinese citizens are being arbitrarily detained and prosecuted.
Changing tastes and expendable income among Chinese travelers could impact the recovery of the travel economy.
“As Chinese households become more price-sensitive and rational, domestic tourism is more favored as it typically costs less time and money,” said Ying Zhang of the Economist Intelligence Unit, a research firm.
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