As China’s domestic tourism unravels, desperate provinces are slashing ticket prices, offering tax breaks and even begging locals to help save plummeting tourist earnings in a sector that employs tens of millions of people.
The slump in tourism – which includes travel, accommodation and catering – has persisted into 2022 because of wider COVID-related curbs on inter-province travel, lockdowns and endless mass testing, official data shows.
Particularly hurt are provinces that lean on tourism for growth such as Hainan and Yunnan, as well as northern regions with smaller windows of mild, tourist-friendly weather.
The downturn has worsened in recent months as the Omicron variant took hold, leaving the industry in its worst state since before the pandemic and boding ill for a sector that contributed 11.05% to China’s gross domestic product in 2019 and supported nearly 80 million jobs, or 10% of all employment.
Tian Yun, a former economist at the state economic planning agency, said he expected inter-province trips to resume during the three-day Dragon Boat Festival holiday in early June.
“If inter-province trips are banned during the Dragon Boat Festival, this year’s tourism and related consumption will be in chaos,” Tian said.
A continued tourism freeze may remove at least 0.5 percentage points from China’s 2022 GDP growth, he said. The government has set a growth target of about 5.5% this year.
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