FROM ISOLATION TO IMMERSION

China’s diverse landscapes, rich architectural heritage, colourful festivities and local delicacies are a major source of attraction for tourists around the world. Tourism is a major industry in China that contributes significantly to its economy. The travel and tourism sector of China was worth 12.3 trillion yuan in 2019 which constituted around 12 per cent of its economy. Data from China’s tourism ministry reveals that over 79.87 million people were directly or indirectly employed because of its tourism industry which is roughly 10.31 per cent of China’s total employed population. International arrivals in China were the highest in 2019 with approximately 145.3 million overseas visitors arriving in China. Over 6 billion domestic trips were made in 2019 with Beijing, Shanghai and Guangzhou being the leading destinations for Chinese travelers. However, by the end of 2019, COVID-19 had hit China, evolving into a global pandemic in 2020. China as well as several countries across the world had to shut their borders during that time to control the spread of the deathly virus; the whole world entered into a lockdown and people avoided leaving their homes.

Being the first country hit by COVID-19; China was also the first to face consequent economic plunges. Tourism was one of the major industries that suffered enormously because of the pandemic. Tourism in China fell considerably between the years 2020 to 2022 and caused a major hit to the economy. In 2022, the contribution of tourism to the country’s GDP was only 3 per cent reaching 3.9 trillion yuan. Prolonged travel restrictions caused a decline in international visitor spending in 2022 to almost 80 per cent lower than 2019 levels and domestic visitor spending to 67 per cent below 2019 levels. Though there was a 60 per cent decline in tourism revenue and an 80 per cent decrease in visitor arrivals in 2020, there was a slight increase in 2021 due to mild domestic travel relaxations. However, in 2022, Macao was the only place where Chinese citizens were allowed to travel for leisure outside mainland China without quarantine requirements. Foreign tourists were not allowed to enter China strictly until January 2023 when China reopened the country for international travel without quarantine requirements.

Causes for the decline of tourism in China

The decline of China’s tourism sector in the years 2020, 2021 and 2022 can be explained by a list of possible reasons. The first and major reason is undoubtedly the coronavirus pandemic. This worldwide pandemic is responsible for a lot of factors that negatively affected the tourism industry. Strict travel restrictions were placed by countries across the globe to prevent the spread of the disease. China closed its borders to almost all foreign nationals on 28^th March 2020 and imposed strict lockdowns within the country. While countries in the West understood that the complete elimination of the virus is not possible and continued functioning, China followed an aggressive “zero-COVID” policy which involved rigorous public health measures like social isolation, mass testing, contact tracing and lockdowns. These measures further hindered travel and severely affected tourism. China’s airline industry experienced a major blow caused by a reduction in the number of flights, the number of routes offered and ultimately passenger flow. Additionally, the worldwide economic slowdown as a result of the pandemic adversely impacted household incomes and decreased consumer spending on any sort of travel, particularly international trips.

With state-imposed limitations on one hand, the fear of contracting the disease among people is another important factor in the fall of tourism. Extensive news coverage about the large number of fatalities and the infection rate of the coronavirus created mass panic and travel anxiety among the world masses and ultimately minimized leisure travelling. Further, travel supply chains like airlines, hotels and other tourism businesses were either shut down or forced to reduce capacities owing to the pandemic. Apart from these, geopolitical tensions between countries can also influence tourism. Strained diplomatic ties between two countries can negatively impact tourism in both countries while stronger ties enhance the same. For instance, diplomatic and political tensions between the US and China have created unfavourable views on both sides among the general public and have certainly continued to shape the decisions of travellers. Moreover, China’s complex visa processing policy and its prolonged waiting time has deterred potential visitors from choosing China as their travel destination

China’s response to tourism decline          

Recognizing these factors that have been hampering the growth of its tourism industry, Beijing has initiated numerous efforts to restore the value of the travel and tourism industry similar to pre-pandemic times. After three years of strict travel restrictions, China opened its border completely to overseas tourists from 15^th March 2023 and resumed issuing all categories of visas. China fully resumed border crossings to and from Hong Kong and Macao much earlier from 6^th February 2023 onwards. On 29^th September 2023, the State Council of China issued a “Notice on Several Measures to Promote High-Quality Development of the Tourism Industry” which listed around 30 crucial measures needed to be taken to unleash the consumption potential of the tourism sector in the country. Some notable measures proposed were increasing the supply of high-quality tourism products; improving tourism consumption policies; transportation services and the night economy; strengthening inbound tourism activities by optimizing visa and customs clearance policies; increasing the number of international flights; optimizing departure tax refund services; and supporting the development of travel agencies and tour guide businesses. 

1. Optimisation of visa and customs policies

China simplified entry procedures for APEC Business Travel Card holders from 1^st May 2023, eliminating the need for separate visa applications. Later, the Ministry of Foreign Affairs instigated a simplified visa application process from 20^th September 2023 which included listing only past year’s travel history instead of the same for the past five years and streamlining the educational background section to only state the highest level of education. The General Administration of Customs announced on 1^st November 2023 that no travelers entering or leaving China will be required to fill the China health declaration form for COVID-19 anymore. The Ministry of Foreign Affairs also announced a reduction in visa application fees by 25 per cent for foreign travellers from 11^th December 2023 to 31^st December 2024. From 11^th January 2024, the National Immigration Administration of China officially implemented five new measures to facilitate inbound tourists. The five initiatives are simplified document submission for visa application; relaxed requirements for port visa applications; easier process for visa extension and renewal; provision of multiple-entry visas; and exemption from border inspection procedures for 24 hours direct transit at nine airports in the country. In the last six months alone, China exempted visa requirements for 11 countries. It resumed its 15-day visa-free policy for the citizens of Singapore and Brunei from 16^th July 2023 onwards. In November last year, the Ministry of Foreign Affairs announced a visa-free entry policy for France, Germany, Italy, the Netherlands, Spain, and Malaysia from 1^st December 2023, to 30^th November 2024 for a transit of up to 15 days. Thailand and China decided in January this year that they will mutually exempt visa requirements from the beginning of March 2024. China also announced a unilateral visa-free policy for the citizens of Switzerland for stays up to 15 days. Recently, it also announced a visa-free policy for Irish citizens. Through these visa-free policies and the ones to come in the future, China aims to ease the process of travelling to China for foreigners as applying for the Chinese visa was considered as a dreadfully long process. This approach can increasingly boost China’s tourism industry, especially after reopening its borders following a global pandemic.

2. Facilitating Payment Systems

Money transactions in China for in-bound tourists is a cumbersome task and has never been simple. This applies to both online as well as cash payments. From July 2023, WeChat Pay announced upgrades to its software that allowed foreign nationals to easily link their international bank cards with it and utilize diverse payment methods like QR code scanning, in-app purchases and WeChat Mini Programs to make purchases conveniently. China also updated its digital yuan app (e-CNY app) on 22^nd September 2023 allowing foreign iOS users to top up their digital yuan wallet (e-CNY wallet) before making transactions. Additionally, foreign users can register their international phone numbers on the app making the process simpler. Such simplifying measures help tourists to worry less about payment issues which is a significant part of travelling.

3. Resuming inbound tourism services

China’s Ministry of Culture and Tourism resumed inbound and outbound group tours between mainland China and Hong Kong as well as Macao from 3^rd February 2023. From 16^th March 2023 onwards, the ministry started accepting applications for foreign commercial performances which were restricted during the “zero-COVID” policy period. It further announced that from 1^st April 2023 all local culture and tourism departments shall gradually resume the examination and approval of both inbound and outbound culture and tourism exchange groups. This way China followed a phased approach for resuming tourism and cultural activities in the country. Starting from 30^th August 2023, China no longer required COVID-19 antigen tests or nucleic acid tests for travellers before entry. Moreover, China’s Ministry of Transport allowed the complete resumption of international cruises following the pilot resumption of international cruise transportation at Shanghai and Shenzhen cruise ports from 19^th September 2023. China has also started putting up multilingual signs and guidance facilities at tourist sites, airports, hotels and shopping areas for the convenience of tourists. These are a few among many efforts taken by China to enhance the tourism services in the country. 

4. Investing in winter tourism

China's focus on winter tourism has contributed to a notable increase in tourism revenue in the first part of 2024. Ever since the Beijing Winter Olympics in 2022, China’s winter tourism market has been rising. Ice and Snow festival conducted in Harbin of the Heilongjiang Province attracted over 3.05 million visitors and generated a tourism revenue of 5.91 billion yuan, figures that are higher than pre-COVID times. The Xinjiang Uygur Autonomous Region saw a year-on-year rise of 285 percent in tourism-related job openings in the fourth quarter of 2023. China’s latest 5-year tourism development plan outlines a focus on "ice and snow tourism," with strategies ranging from resort development to leveraging local cultural traditions. Southern China’s Hainan province which is known for its warm weather also witnessed over sixty per cent growth rates in the number of trips and tourism revenue over the New Year’s holidays.

China's renewed focus on tourism presents a range of potential effects, primarily encompassing economic resurgence. As discussed earlier, the tourism sector contributes a major share to China’s GDP. As a result of its active efforts, the tourism industry in China has remarkably advanced in 2023, marking a notable growth spike post-pandemic. The World Travel and Tourism Council’s (WTTC) Economic Impact Research predicted that the travel and tourism sector in China would contribute $1.48 trillion to the national economy by 2023 which is an increase of over 150 per cent from 2022’s $583 billion contribution. This progress steadily fuels China’s position as a major economic power in the global landscape, especially after the entire world fell into the COVID-19 economic recession. Moreover, tourism increasingly provides job opportunities for people in the country and generates substantial revenue for related businesses. The World Travel and Tourism Council (WTTC) has estimated the tourism and travel sector in China to create more than thirty million jobs over the next decade. Thriving tourism also strengthens China’s soft power and international image as it allows other nationalities to readily engage with Chinese culture and enterprises which transcends China’s influence across borders. The 2022 Beijing Winter Olympics is an example for soft power as it generated positive international media coverage for China. Likewise, tourism also fosters cultural exchanges in a heavily globalized world which encourages appreciation and learning from diverse cultures around the sphere. The promotion of tourism through the Belt and Road initiative facilitated in China's revival of its historical trade routes and enabled cultural exchange. Investments in tourism infrastructure such as transportation networks, airports and hotels ultimately supplement regional development and support tourists and locals in the same way. Local communities and tourism-dependent regions can be immensely benefitted by tourism.

Advancing a single important sector like tourism can largely contribute to the welfare and development of a country. China's efforts to improve its tourism sector have yielded positive results, but opportunities for further development remain. The researcher Zhang Jinshan said that popular Chinese destinations that have recovered post-COVID have more hiring needs than niche attractions. According to him, the tourism sector of China has low recruitment standards and there is a need to improve the skills of workers to better adapt to the evolving tourism market. Cao Heping, an economist at Peking University, said that the government should intensify monetary policy tools to encourage tourism businesses and consumers and support emerging technologies. Li Qiang, the vice-president of Zhaopin.com, an online recruitment service platform, suggested that the government should fund tourism companies to attract talents from universities to raise the abilities of the industry. The tourism industry of China has immense potential and it can be unlocked by further improving infrastructure, embracing digitalization and promoting cultural events. Furthermore, investing in sustainable tourism practices can secure substantial support from the local population towards enhancing the sector and can improve the economy at the same time. The future of China's tourism industry is poised for remarkable growth. By capitalizing on its unique strengths and addressing current challenges, China can solidify its position as a global tourism leader and maximize economic prosperity.