Chinese stay at home – expert classifies travel recession from Middle Kingdom: China crisis hits Swiss tourism

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Are the Chinese coming back? This question concerns the tourist resorts of Switzerland.

For example, the number of Chinese tourists on the Jungfrau Railway is still far from pre-pandemic figures. Despite the strength of the “Jungfrau” brand in China and the large number of special events measured in 2019, only 25 percent of Chinese guests returned. Jungfrau Railway hopes to achieve 50-60 percent of 2019 values ​​this year.

And in Lucerne, the number of visitors from China was still 70 percent lower in 2023 than in 2019. It is expected to be 65 percent in 2024. “We expect the Chinese market to continue to recover,” they say with cautious optimism.

According to Switzerland Tourism, Chinese visitors spent a total of 817,000 overnight stays in the country last year. A decrease of 55.8 percent compared to 2019. It is hoped to reach old numbers again in 2025. But for China expert Yong Chen (43), a professor at the EHL Hospitality Business School in Lausanne, a full recovery to pre-Covid levels is far from certain.

Travel preferably in your own country

“Chinese consumers’ income and confidence remain at their lowest levels in decades as the slowdown in the Chinese economy prevents them from spending,” Chen said. Additionally, China’s overseas tourism was the largest driver of China’s trade deficit in the services sector between 2010 and 2020. In 2019, this was $250 billion. If tourists spend their money domestically, this will increase China’s GDP.

Therefore, if the Chinese government’s priority is to support the economy, regulating outbound tourism may be an option. And so China is now encouraging its population to travel within their own country. “I think the regionalization of Chinese tourism is continuing, meaning more Chinese people are traveling in the Asia-Pacific region in addition to domestic travel,” Chen said.

At the same time, the country is increasingly opening up to foreign tourists. For a few days now, it has become possible for Swiss citizens to enter China without a visa for up to 15 days.

Individual travelers rather than groups?

The Chinese were traveling in large groups. This business will probably change fundamentally: “Independent travelers may replace mass tourist groups,” thinks Chen. This is because long-haul travel to Europe or North America, which is significantly more expensive than before Covid, is only affordable for wealthy Chinese tourists.

But Chen believes that even without Covid, China’s overseas tourism would have peaked around 2020: “This was largely due to the slowdown of the Chinese economy and perhaps changing socio-demographics, such as the aging of the Chinese population.”

China has high purchasing power

At the peak of 2019, only 4 percent of all foreign tourists in our country were Chinese. Why are they still so important? Because they have strong purchasing power: “Shopping was the main travel activity for Chinese tourists in developed countries,” says Chen. Before the pandemic, Chinese tourists spent an average of around $1,800 per person in their destinations, and much more in Switzerland. The global average is $1,000, regardless of country of origin.

The (luxury) watch industry in Switzerland, numerous hotels, restaurants, tourist attractions, transportation service providers and more have benefited from this. And tourists’ direct spending at the destination accounts for only about a third of tourism’s total contribution to GDP.

Source :Blick