Japan Turns to Global Markets as Chinese Tourism Declines Due to New Travel Restrictions

Published on December 18, 2025

Japan’s tourism industry is facing significant challenges following a government-issued travel advisory by China, which has sharply reduced the number of Chinese visitors to Japan. This decline in tourists has led to a noticeable drop in sales at Japanese department stores and a surge in cancellations at hotels across popular tourist regions, creating a ripple effect throughout the country’s tourism and retail sectors.

In recent months, tourist areas in cities like Tokyo, Kyoto, and Osaka, which traditionally rely heavily on Chinese visitors, have been hit hard by this shift. The Chinese government’s advisory, which urges its citizens to avoid non-essential travel to Japan, has resulted in a sharp reduction in Chinese arrivals, leaving hotels with vacant rooms and department stores with fewer customers.

Impact on Japan’s Tourism Industry

Japan’s tourism sector has long been bolstered by the influx of visitors from China, particularly during peak seasons such as Golden Week, Chinese New Year, and summer holidays. Chinese tourists are among the largest groups of international visitors to Japan, contributing significantly to the country’s tourism revenues. Their spending on luxury goods, electronics, and Japanese food has been a major driver of the local economy, especially in cities that attract large numbers of foreign tourists.

However, the travel advisory has caused a sharp decline in the number of Chinese nationals traveling to Japan, significantly impacting key tourist destinations. Japanese hotels, which depend on Chinese tourists for bookings, particularly in Kyoto, Nara, and Hokkaido, have experienced widespread cancellations and low occupancy rates. The reduced demand for hotel rooms has led to financial losses for many businesses in the hospitality sector, which were already struggling due to the lingering effects of the COVID-19 pandemic.

Retail Sector Feeling the Pinch

Similarly, Japan’s retail industry, especially department stores and duty-free shops, has felt the impact of the drop in Chinese tourism. Chinese shoppers have been a key source of revenue for high-end department stores in Tokyo, Osaka, and Sapporo, where they typically purchase luxury goods, electronics, and cosmetics. With fewer Chinese tourists visiting, these stores have seen a notable decline in sales, leading to adjustments in inventory and promotions designed to attract different customer demographics.

The duty-free shopping sector, which has traditionally catered to foreign visitors, has also experienced a decrease in spending. The reduced volume of Chinese shoppers means that these stores are now struggling to maintain their previous sales levels. Retailers are now looking to diversify their offerings and focus on attracting tourists from other regions, such as South Korea, Taiwan, and Southeast Asia.

Efforts to Mitigate the Impact

To counter the decline in Chinese visitors, the Japanese government and tourism authorities are working to promote Japan to other international markets. In particular, they are focusing on attracting tourists from Southeast Asia, Europe, and North America in an effort to fill the gaps left by the decline in Chinese tourists. This shift in focus also includes promoting local tourism within Japan, encouraging domestic travelers to visit popular attractions across the country.

To support the retail sector, several department stores and shopping malls in Tokyo and Osaka have introduced new discount campaigns and sales events targeting international tourists from other regions. These efforts aim to maintain consumer interest and stimulate spending, even as the number of Chinese shoppers remains low.

Additionally, hotel operators have been offering discounted rates and special packages to attract tourists from other parts of Asia and beyond. By focusing on luxury travel, family vacations, and wellness retreats, hotels are attempting to diversify their customer base and cushion the impact of lost Chinese tourism.

Outlook for 2026 and Beyond

The decline in Chinese tourism is expected to continue in the short term, with many businesses and tourism stakeholders uncertain about when the travel advisory will be lifted or eased. However, Japan remains a popular destination for international travelers, and efforts to boost tourism from other markets are likely to bear fruit over time.

In the longer term, the Japanese government is focusing on building a more resilient tourism industry, one that is less reliant on any single market and capable of attracting a more diverse array of visitors. Tourism campaigns will likely expand to highlight Japan’s cultural heritage, natural landscapes, and food tourism to attract visitors from new regions.

Japan’s travel sector is also focusing on sustainability, promoting eco-friendly travel practices and responsible tourism. This could help enhance the country’s reputation as a leading destination for those seeking to explore Japan’s beautiful nature and cultural sites sustainably.

Conclusion

The impact of the Chinese government’s travel advisory on Japan’s tourism and retail sectors is significant, but not insurmountable. While the drop in Chinese tourist arrivals has posed challenges for hotels and stores, Japan’s tourism industry is taking steps to diversify its appeal, with a focus on attracting tourists from other regions and bolstering domestic tourism. By embracing diverse travel markets, sustainability, and targeted campaigns, Japan’s tourism sector aims to weather the storm and continue to thrive as a leading global destination.