China’s Economic Woes to Dampen Golden Week Spending Despite Increased Travel
As China prepares for its National Day holiday, also known as Golden Week, authorities anticipate a slight increase in inter-city trips, with 1.94 billion journeys expected. However, experts predict that average spending per traveler will decline due to the country’s ongoing economic struggles.
The real estate market slump and rising unemployment have led to consumers becoming more cautious with their finances, waiting for income stability before increasing their spending. This is reflected in lower prices for hotels and flights, with Trip.com reporting declines in both domestic and outbound flight prices compared to last year.
While tourism spending may see a slight uptick during the holiday, it’s essential to consider this against the backdrop of last year’s lower base. In 2023, domestic tourism revenue reached 753 billion yuan, a mere 1.5% increase from 2019.
Interestingly, travelers seem to be opting for more affordable transportation options, with the National Railway Administration expecting over 175 million rail trips during the Golden Week period. This shift towards budget-friendly choices may contribute to the anticipated decrease in average spending per traveler.
Despite the challenges, tourism spend and travel numbers within China have shown growth this year. The country expects to see 4.29 billion domestic trips in the first three quarters, a 16.8% increase from last year, with tourism revenue projected to rise 17.1% year on year.
Experts predict that consumer spending may rebound during the upcoming Chinese New Year, following the latest round of government stimulus measures aimed at boosting the economy. However, for now, China’s economic woes are likely to weigh on overall spending during the Golden Week holiday.
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