SHANGHAI, Dec 6 – More than half of Chinese say they will delay traveling abroad for periods ranging from several months to more than a year even if borders reopen tomorrow, a study showed today, a sign helping consumers recover from Covid-19. 19 Measures take time.
Mainland China is maintaining some of the world’s strictest PCR testing and quarantine measures for international travelers, despite some domestic relaxation following last month’s unprecedented Covid protests.
Fears of contracting the disease were the top concern of those who said they would postpone travel in a survey of 4,000 consumers in China by consultancy Oliver Wyman, followed by concerns about changes in domestic re-entry guidelines.
“People have become cautious,” says Imke Wouters, the company’s retail and consumer goods partner. “Even if they can travel, we don’t think they will come back immediately.”
After all, 51% of those surveyed plan to delay international travel. And when they do, short-haul destinations will be the first to benefit, the consultancy said in its China Consumption Recovery study.
The Asian financial center of Hong Kong was at the top of the travel wish list. 34 percent of respondents said this would be their first stop after reopening.
The poll in late October followed the 20th Congress of the ruling Communist Party in Beijing, which gave President Xi Jinping a landmark third term as leader, at an event many had hoped would herald a post-Covid opening.
China used to be the world’s largest outbound tourism market, but its overseas visitors, who spent $127.5 billion on such trips in 2019, have all but disappeared after all, but closed international borders in early 2020 and restricted non-essential travel by citizens.
China’s relentless “zero Covid” effort has hit the economy hard and policies are expected to be reshaped soon, although analysts have warned any reopening will be bumpy and complex. Read the full story
As many as 83 percent of Chinese executives who took part in the survey said that “a long road to restoring consumer confidence” will affect their business in the mainland next year.
While the report noted that lockdowns and economic uncertainty weighed on consumer sentiment, Wouters said Chinese consumers were still poised to increase spending next year if conditions improve.
Almost half, or 44%, of respondents cited an increase in personal savings as a reason they were likely to spend more in the next year.
China’s household deposits rose to 13 trillion yuan ($1.8 trillion) from January to September this year, up from 8.5 trillion in the corresponding period in 2021.
Most spending over the next 12 months will be focused on personal well-being in areas related to health, fitness or wellness.
The outlier, according to Wouters, was Generation Z, or the group born in the mid-to-late 1990s and early 2010s, who focused on spending on “living in the moment.”
“We don’t expect the same boom in luxury spending that we saw in 2021,” she said. “But whatever growth we see, it’s being driven by Gen Z.” – Reuters