2023-11-15
In a pivotal segment of the 2023 WTA • Xianghu Dialogue titled “Win-Win Cooperation: Tourism Links the World”, Mr. CHEN Yin, Chairman of China Tourism Group Corporation Limited, shared his insights on the “Following New Trends in Tourism Consumption and Holding New Opportunities in Chinese Market”.
Here are excerpts from his speech:
Part A. Accelerated Revival of Tourism Consumption Fuels Economic Growth
In the post-pandemic era, China’s tourism industry has shown a robust recovery, emerging as a vital engine for economic growth and a significant contributor to improving people’s quality of life. This resurgence underscores the resilience and vitality of China’s consumer market.
Key indicators of this revival include the domestic tourism market’s rapid rebound, with travel during major holidays reaching new heights. During the Spring Festival, domestic tourist numbers and revenues recovered to 88.6% and 73.1%, respectively, of their 2019 levels. The “May Day” holiday saw both figures surpass pre-pandemic levels, with the following summer marking the hottest tourism season in five years. The Mid-Autumn Festival and National Day holidays continued this trend of surpassing pre-pandemic levels in both tourist numbers and revenues.
Additionally, the tourism sector’s performance has significantly improved. In the first three quarters of the year, 27 listed tourism companies reported revenues recovering to over 90% of their 2019 levels. China Tourism Group achieved a record high in revenue, with a 14% increase over the pre-pandemic period in 2019, and welcomed nearly 60 million visitors, a 20% increase from the same period in 2019.
Tourism’s foundational role in economic development has become increasingly prominent. In the first three quarters, domestic tourism recovered to 80% of its pre-pandemic level in 2019, with domestic tourism spending reaching 85% of that in 2019. National per capita service consumption expenditure grew by 14.2%, accounting for 46.1% of total consumer spending. The World Travel & Tourism Council forecasts that in 2023, China’s tourism industry could contribute nearly 10 trillion yuan to the GDP, a 150% increase year-on-year.
Part B. China Tourism Group Adapts and Innovates in a Changing Market
In response to market changes, China Tourism Group has implemented high-quality development strategies this year to consolidate its leading position in market supply.
These include adjusting and optimizing business structures to align with new development patterns. The CTG’s strategy of “Based in Hong Kong; Cultivate in Hainan; Expand Markets Domestically; Achieve Excellence Overseas” has led to significant achievements. In Hong Kong, assets and personnel have doubled, while Hainan’s Duty Free Shopping Malls in Haikou and Sanya have become the world’s largest and highest-selling single duty-free stores, respectively. Popular destinations like Ningxia’s Shapotou and Guangxi’s Detian Transnational Waterfalls, along with an expanding network of 61 overseas visa centers and hospitality branches across over 30 countries, underscore this success.
The CTG has adhered to major national decisions and deployments regarding the tourism industry. Initiatives include promoting cultural and tourism integration by exhibiting national treasures in Hong Kong, developing comprehensive tourism in Hainan, promoting “Red Tourism” aligned with the Party’s history, educational trips for a million youths in Hong Kong, and rural tourism in Sichuan’s Zhanqi Village and Guizhou’s Huanggang Village. The “Journey to Discover China” program for foreign diplomats in China is another highlight.
Furthermore, the CTG is embracing the era’s pace in fostering technological innovation and digital transformation. This includes developing a new online-offline integration retail model, applying high-tech in tourism scenarios, enhancing core functions, improving competitiveness, deepening the reform of state-owned enterprises, and accelerating the process to build up a world-class enterprise.
Part C. Emerging Trends and Opportunities in Tourism Investment and Consumption
The future of the tourism industry, noting new trends and opportunities in tourism investment and consumption. The industry is witnessing a wave of policy benefits, creating favorable conditions for high-quality development.
Accelerating Recovery in Cross-Border Travel Markets as a New Growth Opportunity: As the world’s preeminent source of outbound tourists and the fourth-largest destination for inbound travel before the pandemic, China’s cross-border tourism market is poised for a swift recovery. Although inbound tourism hasn’t rebounded as robustly as domestic travel this year, we have seen inbound applications return to or surpass pre-pandemic levels in countries like Japan, Canada, and Turkey. Outbound travel, particularly during the Mid-Autumn Festival and National Day holidays, has seen significant growth in destinations like Egypt, the UAE, and Malaysia compared to 2019. With the ongoing restoration of the international tourism supply chain and China’s continued high-level opening up, a new dynamism is expected to invigorate the global tourism industry.
Deep Integration of Culture and Tourism as a Market Development Trend: The growing popularity of events that blend concerts, festivals, sports, and museum experiences with tourism reflects a shift in consumer preferences. Today’s travelers seek more than just sightseeing; they demand rich content, engaging scenarios, and profound spiritual experiences. Future tourism products that creatively incorporate traditional Chinese culture, local characteristics, and world cultural heritage are poised to capture a larger market share. This trend towards a deeper integration of culture and tourism signifies a move towards more thematic and culturally immersive travel experiences.
Technology Innovation as a Catalyst for Transformation: The tourism industry’s inherent pursuit of innovation makes technological advancement a natural and necessary response to market changes. With its extensive industry chain, broad customer base, and rich consumption scenarios, tourism is an ideal field for the application of advanced technologies like AI, big data, cloud computing, and 5G. Only through continuous innovation in tourism consumption scenarios and the advancement of digital and intelligent business processes can the industry meet the evolving demands of the market. This includes enriching immersive and interactive service experiences to better satisfy new consumer needs.
Synergistic Collaboration Across Industry Chains: As consumer demands become increasingly personalized, diversified, and quality-oriented, the limited supply capacity of single enterprises necessitates collaborative efforts. Horizontal integration with sectors like culture, sports, education, and health care will expand industry boundaries and create synergistic supply effects. Vertically, deep cooperation among enterprises along the supply chain is essential to provide integrated, one-stop, and comprehensive high-quality products and services, maximizing overall value. Tourism enterprises must adopt a collaborative, open, and pragmatic approach, fostering broader cooperation among businesses, governments, and academia. Building a tourism industry ecosystem and achieving collaborative success across tourism industry chains, supply chains, and value chains is crucial for driving high-quality development in the sector.
As the only central government-owned enterprise in China focusing on tourism and a century-old legacy in the industry, China Tourism Group is eager to leverage the World Tourism Alliance as a platform for enhancing exchanges and cooperation with industry peers worldwide. Together, we aim to seize the opportunities in the Chinese market, fulfill the people’s aspirations for a better life, and jointly craft a brighter future for the tourism industry.