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China looks through Covid as tourism bookings soar during the Lunar New Year


BEIJING — Chinese people are getting over the pandemic and going out for tourism, preliminary data for the Lunar New Year holiday shows.

“Putted demand is being relieved as more people flock to scenic spots, watch fireworks and squeeze into restaurants and hotels,” said Nomura chief China economist Ting Lu. in a report on Thursday.

China’s Covid “wave of leaving” is rapidly ending as official data shows infections, hospitalizations and deaths all fall, he said. “China has quickly achieved herd immunity to Covid, as the government estimates about 80% of the population has been infected with Covid.”

The country saw an increase in the number of Covid-19 infections in December, just as Beijing ended nearly three years of contact tracing and strict border controls. The seven-day Lunar New Year, which officially begins on Saturday, is the first major holiday since China ended Covid-19 restrictions.

Domestically, bookings at B&Bs more than doubled from a year ago, while ticket sales for attractions more than fivefold, according to the report. Trip.com data for the first four days of the Lunar New Year.

The travel booking site claims that in those four days, bookings for hotels and other travel activities exceeded levels seen in the same period in 2019, before the pandemic.

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People in mainland China are also eager to travel abroad.

Book air tickets from the mainland to abroad in the first 4 days of the holiday quadrupled from a year ago, while related hotel bookings doubled, Trip.com said.

Travel versus spending big tickets

It is not clear whether the increase in tourism implies that consumption in China is on the verge of recovering from a slump over the past three years. Retail sales are down 0.2% in 2022.

According to the Ministry of Transport, daily trips during the Lunar New Year so far – since January 8 – have increased by about 50% from a year ago.

But even tens of millions of trips per day are still down sharply from 2019 levels, the ministry said.

Nomura’s Lu said: “The number of people going to the mall, the number of new home purchases and the car sales figures suggest that large consumption may still decline.”

“Travel car retail sales growth in volume terms slowed significantly to -21.0% year-on-year between January 1 and 15 from 3.0%,” he said in the report. in December, after the end of the 7-month sales tax cut of 50%.”

The propensity to save among Chinese households hit a record high last year amid uncertainty about future incomes and a slump in the property market. The majority of household wealth in China is in real estate.

According to a survey by Oliver Wyman in December, for people in China planning to spend more at brick-and-mortar stores this year, supermarkets ranked highest, followed by convenience stores. Lower rating shopping mall.

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However, sentiments can change quickly.

The study found that within just a week at the end of December, survey participants became significantly more comfortable with venturing out.

“We think that’s a very positive sign of how quickly resilience and consumer confidence will improve,” Oliver Wyman partner Imke Wouters said in an interview. by phone earlier this month. “Retail sales are directly related to consumer confidence.”

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