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Recovery in Chinese outbound tourism to reach meaningful levels by mid-2023: Maybank

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Analysts at Maybank view are optimistic about the recovery in Chinese outbound tourism, indicating that after a tepid start, “the recovery in Chinese outbound tourism is accelerating and will reach more meaningful levels by mid-2023”.

Maybank analyst Yin Shao Yang concludes that Chinese outbound tourism to Singapore will recover the fastest to 2019 levels. Yet, Thailand is still the top ASEAN destination of choice for Chinese tourists.

The latest report mentions that “Singapore will be the top beneficiary of China reopening”, and actual travel from China to Singapore relative to 2019 is recovering the fastest. By mid-2023, seat capacity from China to Singapore will recover to around 65 percent of 2019 levels.

Moreover, Singapore has emerged as a preferred outbound destination for high-net-worth Chinese and single Chinese women. Maybank believes that potential beneficiaries include Genting Singapore and Far East Hospitality Trust.

On the other hand, the research team found out that Chinese outbound tourism shows some changes such as “traveling longer” and “spending more”. According to Dragon Trail International, 60 percent of its surveyed respondents in China intend to travel overseas going forward. Most of them intend to travel overseas during the summer holidays in July and August (42 percent) and the mid-Autumn festival and national day holidays otherwise known as Golden Week (32 percent). Some 71 percent intend to travel overseas for five to 10 days.

Data from “trip.com” also reveal that 59 percent have booked 4-5 star accommodations. In summary, Chinese tourists are traveling longer and spending more relative to the pre-COVID period. Lengths of stay of >14 nights are the fastest to recover relative to 2019 in Thailand, Malaysia and Singapore. Also, the number of Chinese tourists traveling as independent travelers (i.e. singles and couples) are recovering faster relative to 2019 than those traveling as part of tour groups.

“Chinese free and independent travelers are favored around the world over Chinese tour groups due to their perceived higher spending budgets”, Maybank analyst Yin Shao Yang wrote. Anecdotal evidence suggests that Chinese that travel as part of tour groups tend to have lower spending budgets.

Regarding ASEAN destinations for Chinese pre-COVID, Thailand, Malaysia and Singapore were in the top 10 Chinese outbound destinations list.

Post-COVID, Thailand and Singapore are still in the top 10 preferred Chinese outbound destinations list but Malaysia has dropped out from it according to Dragon Trail International. Curiously, another survey by Qyer did not list Singapore as being in the top 10 preferred Chinese outbound destinations list pre- or post-COVID. To be sure, Malaysia also dropped out from the top 10 preferred Chinese outbound destinations list according to Qyer.

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