China National Day: Tourist Spending Declines Compared to Pre-COVID-19 Levels

During the Chinese National Day holiday period, the amount of money spent by tourists was found to have decreased compared to before the COVID-19 pandemic.

Chinese people enjoying the National Day holiday. [Image source=Yonhap News]

According to major foreign media on the 9th, the amount of money spent by tourists during the Chinese National Day holiday from October 1 to 7 decreased compared to 2019, before the COVID-19 pandemic.

According to statistics released by the Chinese Ministry of Culture and Tourism, the number of tourists during the National Day Golden Week increased by 10.2% compared to 2019, but spending only increased by 7.9%. Based on this data, major foreign media reported that "the actual spending per tourist decreased by 2.1% compared to five years ago." Wang Lisheng, an economist at Goldman Sachs, pointed out that the decrease in spending per tourist "means that domestic demand is still weak and consumption continues to decline."

Meanwhile, there are also statistics indicating that Chinese consumption has somewhat recovered compared to last year and early this year. The average daily spending per tourism transaction during the National Day holiday was 131 yuan (about 25,000 won), which increased compared to the 113 yuan (about 21,000 won) daily spending during the May Labor Day holiday.

The Chinese government introduced various stimulus measures to revive the sluggish domestic market, including interest rate cuts at the end of last month, subsidy payments, and support measures for the real estate and stock markets. Officials from the National Development and Reform Commission, the macroeconomic authority, also pledged at a press conference the day before to accelerate infrastructure spending.

Duncan Reilly, Chief China Economist at Pantheon Macroeconomics, stated, "The key to boosting consumer sentiment is fiscal policy support," and expressed the view that additional stimulus through fiscal investment is necessary to avoid a pattern where consumption temporarily increases only during holiday periods and then disappears.