Analysis
Post-THAAD recovery continues in Korea as Japan attracts record number of Chinese visitors
The Moodie Davitt Business Intelligence Unit’s Min Yong Jung analyses the latest traffic figures for Korea and Japan – two countries currently engaged in a political and economic standoff.
The combined number of Chinese inbound visitors to Japan and Korea rose by +18% year-on-year in August, to 1.579 million.
In Korea, the recovery towards pre-THAAD inbound levels continued apace but the absence of packaged tours – which constituted approximately 40% of total Chinese inbound traffic – still means a large gap compared to the record levels set in 2016.
Total inbound traffic was marginally down in Japan with a record number of Chinese visitors making up for the shortfall from a sharp decline in Korean visitors. Koreans are aggressively rejecting Japanese products and Japan as a travel destination following the political and economic standoff between the two countries.
Source: Korea Tourism Organization, Japan National Tourism Organization, Moodie Davitt Business Intelligence
Total inbound traffic declined -2.2% year-on-year in August to 2.52 million visitors in Japan. The dependence on Chinese visitors was up to a 39.7% share, significantly higher than the 26.9% share seen in 2018.
Chinese visitors to Japan grew +16.3% year-on-year and stayed above the one million visitor mark (a new monthly record of 1.05 million was set in July 2019). This made up for the rapid decline of Korean visitors to Japan, which declined -48% – a much higher level than the -7.6% year-on-year drop recorded in the previous month.
Monthly inbound/outbound visitors (Japan)
Source: Japan National Tourism Organization, Moodie Davitt Business Intelligence
The Japanese government remains determined to capture as much of the Chinese outbound travel market as possible and has simplified the visa application process for Chinese travellers. In April 2019 the Japanese Embassy in China issued a notice to designated travel agencies that the application process for 15-day single travel visas had been changed from paper to online. Chinese travellers and travel agencies have responded warmly by increasing travel to Japan.
Total inbound traffic grew +14% year-on-year in August to 1.586 million visitors in Korea. The number of Chinese visitors remains on an upward trajectory towards the pre-THAAD level recorded in 2016. The number of Chinese inbound visitors to Korea was up +20.9% to 578,112; the last occasion the figure approached the 600,000 mark was February 2017.
Despite the strong growth of Chinese FIT visitors to Korea, Chinese package tours remain largely absent from Korea’s tourism market. The Korean government has made repeated attempts to address this issue, with the country’s Minister of Culture, Sports and Tourism meeting his Chinese counterpart in May and August of this year. However, tour operators have yet to resume sales of Korean package tours on their platforms.
The Korea Tourism Organization reports that three large scale package tours (exceeding 3,000 visitors per tour) from China are planned for the second half of this year. This represents an improvement from zero at the beginning of the year and suggests some headway has been made by the government to mend ties with China.
Monthly inbound/outbound visitors (Korea)
Source: Japan National Tourism Organization, Moodie Davitt Business Intelligence
Monthly inbound/outbound visitors (Korea) - mode of transport
Source: Japan National Tourism Organization, Moodie Davitt Business Intelligence
Monthly inbound/outbound visitors (Korea) - mode of transport for major source market
Source: Japan National Tourism Organization, Moodie Davitt Business Intelligence
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The Moodie Davitt eZine
Issue 268 | 26 September 2019
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