As Lockdown Ends, China's Air Travel Demand Soars... Domestic Flights Up 158% in 2 Weeks

China Eastern Airlines Reports 150% Increase in Domestic Flights and 140% Rise in Passengers Compared to Early This Month

[Asia Economy Reporter Kwon Haeyoung] As China relaxes its COVID-19 lockdown measures, allowing freer movement between regions, Chinese airlines are rapidly increasing domestic flights. Expectations are rising for a recovery in domestic demand and an economic rebound next year.

The Wall Street Journal (WSJ) reported on the 19th (local time), citing data from global aviation analytics firm Cirium, that on the 12th of this month?the day after China lifted interregional travel restrictions?domestic flights in China reached 7,290, an increase of 158% compared to two weeks earlier.

China's three major state-owned airlines, including China Eastern Airlines, announced via social media platform Weibo that domestic flights have increased by more than 150% compared to early this month. Passenger numbers also rose by over 140% to 140,000 during the same period. China Eastern Airlines described this as a "rapid recovery phase," stating that domestic flights have continuously and sharply increased over the past few days.

Currently, domestic flights in China have nearly recovered to levels seen at the beginning of the year or last year. However, international flights remain more than 80% below pre-COVID levels.

The surge in domestic flights is due to the Chinese government's shift from a "Zero COVID" to a "With COVID" policy. Since the 13th, the government has abolished mandatory COVID testing for entry into public places and for interregional travel within China. Previously, individuals had to submit a negative PCR test result taken within 24 to 72 hours to enter public places, and travelers between regions were required to scan a "Health QR code" to restrict movement of those who had passed through areas with confirmed cases.

Some cautiously predict that with the easing of COVID restrictions, China's economy could achieve a growth rate in the 5% range next year.

Some global investment banks (IBs) have also projected China's growth rate to be in the 5% range next year. According to Xinhua News Agency, France's Soci?t? G?n?rale forecasted that "China's economy will rebound strongly from the second or third quarter next year, sustaining robust growth for three to four quarters," suggesting that China could achieve a 5% growth rate. U.S. Morgan Stanley also raised its growth forecast for China next year from 5.0% to 5.4%.

However, pessimistic views remain as the recent surge in COVID cases is expected to contract domestic demand, making it difficult to escape a period of economic slowdown in the near term. British consulting firm World Economics (WE) surveyed sales managers from over 2,300 Chinese companies and found that the business confidence index dropped 3.7 points to 48.1 in December from 51.8 in the previous month, marking the lowest level since the survey began in 2013.

WE explained, "The number of companies reporting negative impacts from COVID has significantly increased, and more than half reported difficulties in business operations," indicating that China's economic growth has sharply decelerated and may head toward a recession in 2023.