Dear readers,

the year 2018 is coming to an end, time to take a look back on the major developments according to COTRI ANALYTICS data.

The main story in terms of absolute arrival numbers this year has been the comeback of the Hong Kong and Macau SARs. After two weak years, both destinations saw a YoY growth rate of 13% in 2018, adding altogether nine million arrivals to new totals of more than 50 million and more than 25 million respectively. Taking into account the three million arrivals to Taiwan, more than 78 million of all border crossings from Mainland China, representing 48% of the total, ended in Greater China. The other 52% went further beyond, bringing close to 84 million Chinese to destinations around the world. The overall number of 162 million, if not influenced by Black Swan events in the few weeks of the year still ahead of us, slightly exceeds the COTRI forecast due to the stronger-than-expected performance of Hong Kong and Macau and represents a YoY growth rate of 12% for 2018.

However, the first half of the year saw the stronger growth of 15% compared to the first half of 2017, whereas for the second half of the year 2018 the YoY growth rate fell to below 10%.

Thailand, Japan, Vietnam and South Korea were the four destinations outside Greater China which saw for each quarter of the year more than a million arrivals from Mainland China, with Thailand loosing visitors after a fatal boat accident in July, whereas South Korea could surpass Vietnam again in the third quarter after the complete lifting of travel restrictions for groups by the Chinese government.

In terms of YoY increase in percentages smaller destinations stole the limelight. Countries which managed quarterly increases in Chinese arrivals of more than 50% included Bosnia & Herzegovina, Cambodia, Croatia, Cyprus, Georgia, Greece, Macedonia, Montenegro, Nepal, the Philippines, Serbia and Turkey. Of the main destinations, only Russia with the FIFA World Cup and South Korea bouncing back after dismal figures in 2017 were able to join this club.

The most important event for the organisation of China’s outbound tourism was the creation of the new Ministry of Culture and Tourism and the parallel closure of the CNTA China National Tourism Administration in March. The National People’s Congress explained that “the move is aimed at … enhancing the country’s soft power and cultural influence, and promoting cultural exchanges internationally”, spelling out in clear words the political dimension of China’s tourism development. The positive attention Panama received in Chinese media as a travel destination after its government decided to severe relations with Taiwan and the major difficulties South Korea and Taiwan experienced as a result of the displeasure of the Chinese government with political decisions taken there provided impressive examples of the role politics can play. Tourism relations were also constantly mentioned as an element in the further development of the Belt and Road Initiative.

Hosts all over the world reported that the Chinese visitors continued to become more and more sophisticated, but also more demanding, being able from past experience to specify their wishes and to compare the quality of the service provided with previous services. “Living like a Local”, including gaining knowledge about local food and beverages, went up on the bragging-power scale, whereas shopping, especially for the most common luxury brands, lost some of its shine. FIT travel, but also customised travel with itineraries provided by OTAs to small groups, gained further market share. On the list of essential services for Chinese visitors the provision of WiFi was overtaken by the need to be able to accept mobile payment via Alipay and WeChat Pay.

Next week, in the last issue of COTRI Weekly for 2018, we will gaze into the crystal ball with an outlook for the coming year 2019.

With best wishes for a peaceful and profitable week,

Prof. Dr. Arlt and the COTRI Weekly team

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