Trade war causes slump in Chinese outbound travel

Southeast Asia’s tourism hotspots are feeling the effects of the U.S.-China trade war, which has caused a slump in tourism arrivals and spending, Bloomberg reports. 

While rising incomes for middle-class Chinese consumers helped to fuel the region’s tourism industry, their abrupt stop in travel has made it difficult for countries and towns that have become accustomed to receiving their tourism dollars. 

“The slump in Chinese arrivals and tourism spending is being felt throughout the region,” said Mr Kampon Adireksombat, Bangkok-based head of economic and financial market research at Siam Commercial Bank. “There’s always a concentration risk when relying on one market, and many countries may not be able to find a replacement for growth fast enough.”

The tourism slump is expected to continue in 2020 if the trade war continues to weigh on the Chinese economy, he said. 

Over-capacity of hotel rooms has become a real challenge for many Southeast Asian countries, including Thailand and Indonesia, known favorites for Chinese tourists. 

It is understood that countries are now trying to diversify their inbound tourists. Thailand earlier this year waived visa fees for Indian tourists. 

Vietnam has set up tourism promotion offices in Britain and Australia and is working on direct flights between India and Vietnam, set to launch in October.