China Sees Surge in Tourism Spending During Lunar New Year, Surpassing Pre-COVID-19 Levels

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Tourism profits in China during the Lunar New Year holiday that ended on Saturday rose 47. 3% year-on-year and surpassed 2019 levels, thanks to booming domestic travel amid a longer-than-usual pause, official data showed on Sunday.

This knowledge may simply be offering transitory relief to policymakers as the world’s second-largest economy faces deflationary dangers amid weak customer demand, but the sustainability of the tourism recovery is doubtful and tourism earnings have remained below pre-pandemic levels.

During the holiday, known as the world’s largest annual migration, tourist attractions across the country saw crowds.

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Domestic tourism spending increased 47. 3% to $87. 96 billion compared to the same holiday period in 2023, according to data from the Ministry of Culture and Tourism.

People with statues of deities parade down the street as they witness the classic customs of the Lunar New Year, Feb. 19, 2024, in Fuzhou, Fujian province, China. The tourism gains in China are the Lunar New Year holiday that ended on Saturday (Lyu Ming/China News Service/VCG via Getty Images)

The number of domestic trips saw this year’s holiday increase by 34. 3% compared to last year, to 474 million.

Compared to the 2019 Lunar New Year holiday, before the COVID pandemic hit the country, domestic tourism spending increased by 7. 7% and domestic spending by 19%, according to ministry data.

But the year 2024 lasted 8 days, one day longer than the Lunar New Year of 2019.

The ministry did not provide details on holiday-related tourism spending, but according to Reuters calculations based on ministry data, average holiday-related spending this year reached 1,335 yuan, down 9. 5 percent from the holiday-related 1,475 yuan in 2019.

Goldman Sachs analysts said in a note on Sunday that domestic tourism awareness for the Lunar New Year holiday advanced compared to this previous year’s New Year’s holiday and National Day Golden Week last October, however, tourism gains consistent with the capita declined and remained low. than before. pandemic level.

This suggests that “a deterioration in intake is still observed,” they said.

This holiday, also known as the Spring Festival, is historically the time when millions of people return to their hometowns by plane, exercise, or road to reunite with their families.

In terms of overseas travel, China recorded about 13. 52 million inbound and outbound trips during the holiday, a 2. 8-fold increase compared to the same holiday time last year, according to the National Immigration Administration.

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Total inbound and outbound travel and vacations are back to 90% of 2019 levels, according to management.

As watching video becomes one of the most popular entertainment activities during the holidays, the country’s box office revenue surpassed $1. 11 billion in eight days, according to the China Film Administration, setting a new record.

The economy has been grappling with tough conditions since last year, coupled with a housing slowdown and sluggish demand, forcing policymakers to cut interest rates to breathe life into growth even as many evolved economies struggled to control stubbornly high inflation.

As the government tries to strike a sensible balance for the economy at a time when symptoms of deflationary pressures call for more stimulus, China’s central bank left its key interest rate unchanged on Sunday as it renewed maturing medium-term loans.

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