[Correspondent Diary] China National Day Golden Week, Profit and Loss Statement

Around 800 Million People on the Move During National Day Holiday, Travel Revenue Alone Reaches 111 Trillion Won
Domestic Market Faces Recession Again if COVID-19 Resurges... Economic Forecast Uncertain for Second Half of the Year

[Asia Economy Beijing=Special Correspondent Jo Young-shin] Ahead of the National Day holiday (October 1?8), the Chinese mainland is buzzing with activity.

National Day marks the founding of the People's Republic of China and, along with the Spring Festival and Labor Day, is one of China's three major holidays. This year, National Day coincides with the Mid-Autumn Festival (Chuseok), ushering in a golden holiday period across the Chinese mainland.

From the Chinese government's perspective, this National Day presents a great opportunity for the domestic market, especially the tourism and leisure industries, to regain momentum.

Typically, the floating population within China during National Day approaches 800 million. In 2019, travel revenue during the National Day holiday period reached 650 billion yuan (approximately 111.7 trillion Korean won).

[Image source=Reuters Yonhap News]

This year’s National Day is likely to see an explosive surge in travel demand from Chinese citizens who have faced movement restrictions due to the COVID-19 pandemic.

According to China’s People’s Daily Online, there has been a significant increase in the number of Chinese purchasing train tickets to popular tourist destinations such as Guangzhou, Shenzhen, Beijing, Shanghai, Changsha, Chongqing, Chengdu, and Xi’an.

With rising demand, airfares (around the last day of the holiday) have climbed back to levels seen during last year’s National Day holiday.

Hotels are no exception. It is difficult to find rooms in major popular areas such as Sanya, Xi’an, Chongqing, Xiamen, Chengdu, Nanjing, Hangzhou, Suzhou, Tianjin, and Changsha.

The Chinese government is also actively promoting the golden holiday atmosphere.

During the National Day period, the government is offering discounts and full waivers on entrance fees to tourist sites nationwide. Xi’an is waiving admission fees at over 50 locations including Datang Furong Garden (大唐芙蓉園), while Shanxi is exempting fees at 130 sites including the Yungang Grottoes (雲岡石窟).

Qingdao has also opened 12 A-level tourist sites such as Laoshan for free. In Zhangjiajie, 500,000 tickets priced at 1 yuan (approximately 171 Korean won) are being sold to Chinese visitors.

Thirty-two A-level tourist sites in the Xinjiang Autonomous Region, which has faced criticism from the United States and other Western countries, are also waiving entrance fees.

There is a prevailing expectation that this National Day will trigger a sharp rebound in China’s domestic industries, driving the country’s economy in the fourth quarter.

However, concerns are as significant as the expectations. The end of COVID-19 is not global but limited to China itself. With 700 to 800 million people moving within a short period, the possibility of a large-scale cluster infection cannot be ruled out.

A source from Beijing’s diplomatic circles said, “From the Chinese government’s perspective, this National Day is a good opportunity to boost the sluggish domestic market all at once,” adding, “Whether COVID-19 resurges after the National Day holiday will determine China’s economic trajectory in the second half of the year.”