Dear Readers,

According to COTRI Analytics, the third quarter of 2019 saw 44.5 million border crossings from Mainland China, an increase compared to the same period in 2018 of only 3.5%.

The main culprit for the slowdown after double-digit growth rates for the first two quarters 2019 is obviously Hong Kong SAR, which suffered a decrease of 28% in arrivals, which translates to more than 3.5 million visitors less. Most of these losses occurred in August and September, with the arrivals of overnight visitors from China in August even falling to less than half the number of August 2018. Let us hope for everybody in Hong Kong, including our friends and partners in The Hong Kong Polytechnic University, that the violence will end soon and peaceful ways to solve the existing crisis will be found.

Macau suffered with its sister SAR, seeing the increase in Chinese arrivals going down to 10% YoY after more than 20% for each of the first two quarters of 2019. Also Singapore (+6%), Japan (+20%) and South Korea (+24%) did not profit as much from the disturbances in Hong Kong as could have been expected. Singapore could at least report the first quarter ever with more than one million arrivals from China. Thailand (+17%) and Vietnam (+20%) saw however clearly increased performances after dismal results in the first half of the year.

The real winners continued to be the small countries, which are able to attract the “Second Wave” of Chinese travellers looking for new places. Bosnia & Hercegovina topped the list with +77%, other European fringe destinations like Serbia (+50%), Georgia (+45%), Romania (+47%) also achieving impressive growth, albeit from a low base. Traditionally strong destinations in Europe like Switzerland (-7%), Czech Republic (-2%) or Germany (-1%) suffered accordingly.

The amplitude of movement has been high also for a number of destinations which won or lost for country-specific reasons: Israel shot up by 46% and Chile by 25%, whereas Nepal, after a strong performance in 2018 and during the first half of 2019, dropped by -6%. New Zealand continued to suffer, clocking -9% Chinese arrivals for Q3 2019, similar to the USA, if for different reasons.

Island destinations faired uneven as well: Sri Lanka went down by -65%, Mauritius by -42%, the Seychelles by -17% and Indonesia (a.k.a. Bali) by -12%. The Maldives (-5%) and Fiji (-1%) could at least limit their losses. The shining knight in this group remained The Philippines, where the Chinese arrival numbers for Q3 2019 shot up by more than 50%.

The Chinese travellers can choose between more than ever destinations, with visa, connectivity and language becoming less and less of a problem. The last quarter has clearly proved again that smaller destinations can be successful if they get their act together, whereas many traditional destinations have to work harder to attract Chinese leisure visitors especially to come back for a second time.

With all best wishes for our readers for a peaceful and profitable week,

Prof. Dr. Wolfgang Georg Arlt and the COTRI WEEKLY team

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