Lunar New Year: Tourism Expenditure in China Surpasses Pre-Covid Levels

Travel spending increased during the Lunar New Year holiday, outpacing previous outbreaks, according to official data. Domestic travel spending reached 632.7bn yuan (£69.7bn), up 47% on last year’s holiday season. This resurgence in spending came after the lifting of pandemic restrictions in early 2023 and was further strengthened by the extension of the holiday season.

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The festival year saw 474 million tourists arrive during the eight-day holiday; This showed significant growth of 34% on the previous year and maintained a staggering 19% growth on pre-pandemic levels in 2019. However, the average spend per trip was slightly lower at 9.5% compared to 2019, indicating lower spending.

Goldman Sachs analysts pointed out that the decrease in spending per trip reflects the low consumption model. Lunar New Year, also known as the Spring Festival, traditionally brings the world’s largest migration to China, with millions of people from around the world returning home or exploring tourist attractions across the country. However, the ban on the spread of the virus in the last year has also affected the culture.

Amid ongoing challenges, a resurgence in Lunar New Year spending brings good financial news for China. The country faces concerns about housing market problems, slow exports and deflationary pressures. In addition, China’s foreign direct investment (FDI) growth has been at its slowest level in the last 30 years, reaching its lowest level since 1993, according to the latest data from the State Administration of Foreign Trade.