Asia tourism reopens, but travel restrictions keep big-spending Chinese at home

Saturday, November 6, 2021

Asia’s gradual easing of international travel curbs is proving a welcome relief for the region’s hard-hit tourism operators slowly opening up to visitors from around the world – with one giant exception.

China, previously the world’s largest outbound tourism market, is keeping international air capacity at just 2 per cent of pre-pandemic levels and has yet to relax tight travel restrictions as it sticks to zero tolerance for COVID-19.

That has left a $255 billion annual spending hole in the global tourism market for operators such as Thailand’s Laguna Phuket to try and fill.

Managing director Ravi Chandran says Laguna Phuket’s five resorts have shifted their marketing focus to Europe, the US and the UAE to make up for the loss of Chinese visitors, who accounted for 25 per cent to 30 per cent of its pre-COVID-19 business.

The pandemic has cost Thailand an estimated $50bn a year in tourism revenue and the Chinese were above-average spenders based on tourism ministry data.

Thailand hopes to receive 180,000 foreign tourists this year, a fraction of around 40 million it received in 2019, as it opened places beyond Phuket to tourists on Monday.

Many experts expect China to keep stringent measures, such as a three-week quarantine for those returning home, until at least the second quarter of next year and possibly then only open gradually on a country-by-country basis.

Destinations have to identify new source markets and learn how to market and cater to different cultures, said Liz Ortiguera, Pacific Asia Travel Association Chief Executive, citing the Maldives as a rare example of a successful pivot during the pandemic.

The string of islands in the Indian Ocean promoted itself heavily at trade shows and attracted more Russian and Indian visitors to its luxury resorts and sparkling waters.

China had been its greatest source of tourists before the pandemic but the Maldives saw overall arrivals in the first nine months of 2021 fall 12 per cent versus the same period of 2019.

Even as Singapore, Thailand and Indonesia’s Bali gradually open up for international travellers, Thai Airways and Garuda Indonesia are drastically shrinking their fleets as part of restructuring plans amid the absence of Chinese tourists.

There has also been a boom in domestic holidays to Hainan Island, which now offers duty free shopping in a threat to future visits to nearby destinations such as Hong Kong and South Korea.

Large group tours that have also fallen out of favour on domestic trips could also be a thing of the past, to be replaced by independent travel and smaller customised tours with family and friends.

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