China Golden Week 2024 Sees Rapid Surge in Outbound Travel along with Macau’s Gambling Sector Rebounds Amid Changing Tourist Behaviour

Published on October 7, 2024

By: Tuhin Sarkar

As China celebrated Golden Week 2024, a national holiday marking the founding of the People’s Republic, encouraging signs of recovery emerged within the travel and tourism sectors. Official forecasts showed that cross-border travel saw a remarkable upswing, with average daily volumes increasing by 19% compared to the previous year, even surpassing pre-pandemic levels.

The data suggest that wealthier Chinese travelers were particularly eager to take advantage of the holiday, with outbound travel rising 40% year-on-year on October 1st alone. Long-haul flights surged past pre-pandemic levels, and online travel agency Trip.com recorded a 30% spike in European bookings. These trends indicate a growing confidence among Chinese consumers, especially within the middle class, as they shift from spending on material goods to investing in experiential travel.

Meanwhile, Macau, a key gaming destination for mainland Chinese tourists, reported a 5% increase in visitor numbers during the first three days of Golden Week compared to 2019, according to CLSA. The premium mass gambling segment hit record highs, demonstrating that the appetite for high-end entertainment remains robust despite a slight dip in individual spending.

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Outbound Travel Sees Record Growth: A Rebound for Long-Haul Destinations

Golden Week has always been a barometer for consumer sentiment and spending in China, and this year, it brought particularly welcome news for the global travel industry. According to data from Trip.com and HSBC research, outbound travel on the first day of the holiday (October 1st) surged by 40% compared to last year, signaling a major recovery in international travel demand.

The surge in outbound travel was driven by middle-class and affluent Chinese travelers, who have shown a renewed interest in venturing beyond their country’s borders after years of pandemic-related restrictions. Long-haul destinations, particularly Europe, saw significant gains, with advanced bookings jumping by 30%. Countries such as France, Italy, and the UK were among the most popular European destinations, thanks to their rich cultural experiences and shopping opportunities.

One of the standout statistics comes from Alipay, China’s dominant mobile-wallet service, which reported that international travelers spent 120% more using accounts linked to international cards during this year’s Golden Week. This substantial increase in spending suggests that wealthier Chinese tourists are once again indulging in overseas trips, despite slower domestic consumption trends earlier in the year.

Macau: Gambling Revenues Hit New Highs Despite Subtle Shifts in Spending

Macau, often referred to as the “Las Vegas of the East,” also saw strong visitor numbers during the holiday. Between October 1st and October 3rd, a total of 478,713 visitors flocked to Macau, representing a 5% increase compared to 2019 levels and a 21% increase over 2023. Of these visitors, 6% were from mainland China, further reinforcing Macau’s status as a top destination for high-end Chinese gamblers.

A notable development in Macau’s gambling sector during Golden Week 2024 was the record-setting activity in the premium mass market, which caters to the higher-end of the mass market gamblers. According to a survey conducted by Citi, total wagers in this segment hit all-time highs, even though the average bet per person declined slightly. The surge in gambling activity was driven by the sheer volume of visitors, underscoring Macau’s continuing appeal as a gambling haven despite changing consumer behaviors.

While gamblers returned in droves, their spending habits appeared to have shifted slightly. Analysts noted that individual bets were slightly lower, which may indicate more cautious spending patterns among mainland tourists. However, the overall increase in visitor numbers and gambling volumes highlights the resilience of Macau’s casino industry.

Changing Consumption Trends: From Material Goods to Experiences

One of the most striking aspects of Golden Week 2024 was the shift in consumer behavior. Chinese travelers, particularly those from the middle class, appear to be prioritizing experiences over material purchases. According to Alipay, this change in spending habits was evident as travelers spent more on travel-related services, such as hotel bookings, tours, and entertainment, rather than luxury goods.

This shift is not entirely surprising given the broader economic context in China. Domestic demand has remained relatively sluggish for much of the year, with retail sales rising just 2.1% in August, missing analysts’ expectations of 2.5%. The slowdown in the property market and concerns over economic growth have likely contributed to more conservative spending habits on non-essential items.

However, the willingness of middle-class consumers to spend on travel experiences during Golden Week suggests that there is still significant pent-up demand for leisure and entertainment. With Beijing recently unveiling a range of stimulus measures to boost consumer confidence and economic growth, this trend could gain momentum in the coming months.

Beijing’s Stimulus Efforts: Will the Boost in Travel Spur Broader Recovery?

Golden Week 2024 comes at a time when Beijing is looking for ways to stimulate domestic demand and drive economic recovery. In the weeks leading up to the holiday, Chinese officials rolled out a series of property easing measures and signaled that more fiscal stimulus could be on the way. These moves have already had an impact on financial markets, with Hong Kong’s benchmark index rallying by 25% as investors anticipate further government intervention.

While the data from Golden Week suggests that certain sectors of the economy—particularly travel and leisure—are seeing a rebound, it remains to be seen whether this recovery will be sustained. The mixed signals from other indicators, such as retail sales and the domestic box office, highlight the uneven nature of China’s economic recovery.

The mainland box office, which is typically seen as a reliable gauge of domestic consumption, lagged behind expectations during the holiday. Ticket sales reached the 1 billion yuan ($143 million) mark a day later than they did in 2023, indicating that domestic demand for entertainment may still be underwhelming.

International Travel Industry Eyes China’s Recovery

For the global travel trade, China’s Golden Week represents an important test of the country’s post-pandemic recovery. As one of the world’s largest outbound travel markets, China’s return to international travel is a critical factor for the global tourism industry’s recovery.

With outbound travel surging and Chinese tourists once again spending abroad, destinations around the world are preparing for an influx of visitors from China. Luxury retailers, hotels, and tour operators in Europe, Southeast Asia, and beyond will be keen to capitalize on this growing demand.

At the same time, the Chinese government will be monitoring these trends closely to determine whether its stimulus efforts are gaining traction. If middle-class consumers continue to open their wallets for travel and leisure, it could help support broader economic recovery efforts.

A Glimmer of Hope for the Travel Industry

Golden Week 2024 has provided much-needed good news for both the travel trade and China’s economic policymakers. The 40% increase in outbound travel and record-breaking gambling activity in Macau highlight the resilience of China’s middle class and their willingness to spend on experiences, even in the face of broader economic uncertainties.

As Beijing continues to roll out measures to stimulate domestic demand, the early signs from this year’s Golden Week suggest that consumer confidence may be on the mend. If these trends persist, they could provide a significant boost to both the travel industry and the broader economy, offering a glimmer of hope as China navigates its path to recovery.