China’s festival tourism hit by brakes

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The country’s deteriorating tourism data could lead to further cuts in Wall Street’s GDP growth forecasts, Nomura Holdings Inc.

The number of trips made during China’s three-day Mid-Autumn Festival holiday declined, with tourism revenue also declining, official data showed, as strict COVID-19 rules discouraged people from travelling.

The number of trips made by tourists fell 16.7 percent from a year earlier to 73.4 million trips during the holiday, which ended on Monday, the Chinese Ministry of Culture and Tourism said. Tourism.

Tourism revenue fell 22.8% to 28.68 billion yuan ($4.14 billion), the data showed.

Photo: Reuters

China has fought to contain the highly transmissible Omicron variant of SARS-CoV-2, imposing varying degrees of lockdowns to stop its spread this year and stepping up restrictions and restrictions where necessary.

In the capital, Beijing, people returning to work yesterday had to show negative test results within 48 hours, up from 72 hours previously.

Authorities at large have also urged people to refrain from non-essential travel ahead of a weeklong National Day holiday and the Chinese Communist Party Congress next month.

“We believe travel for family reunions, tourism and retail sales will be hit hard in the coming months, including the Golden Week National Day holiday from October 1 through October 7,” said Nomura Holdings Inc.

“Deteriorating tourism data could lead to further cuts in GDP growth forecasts hitting the streets,” Nomura wrote in a note yesterday.

During the Mid-Autumn Festival, a holiday that usually involves family gatherings, trips by road fell 37% to 48.18 million and those by boat fell 15% to 1.54 million, reported Monday on state television.

People took 1.28 million air trips to China, according to the report, a level nearly 60% lower than the corresponding vacation last year.

Goldman Sachs Group Inc sees China persisting in its zero-tolerance approach to COVID-19 after the party convention next month, with economists at the bank downplaying expectations of any major policy changes immediately after the meeting.

Stability would be the dominant narrative ahead of the meeting of China’s top leaders, where Chinese President Xi Jinping (習近平) is expected to secure an unprecedented third term, economists including Hui Shan (閃輝), leader of the Goldman in China. a report released yesterday.

The once-every-five-year summit would focus primarily on reshuffling the party leadership, Goldman economists wrote, with a pivot away from “zero COVID-19” — China’s current strategy of contain the virus with lockdowns, mass testing and borders. checks – probably not before the annual Chinese National People’s Assembly in the first half of next year.

Some experts see China persisting with the long-term disruptive strategy, given the country’s low vaccination rates among the elderly and less effective COVID-19 inoculations.

Additional reports from Bloomberg

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