Asia’s tourism market is not expected to recover to its pre-Covid levels before 2024, due to the lack of Chinese tourists and ongoing travel restrictions, according to an Economist Intelligence Unit (EIU) white paper.
The EIU said that with the exception of some smaller nations, such as Fiji and the Maldives, most countries in Asia will only see a partial recovery this year, with both visitation and receipts likely to be far below 2019 levels.
In its Asia Travel-ready Index, the EIU ranks the countries that are seen as having the most favorable conditions for tourism to recover.
Fiji ranks first. Amongst the region’s gaming jurisdictions, Malaysia was the most highly ranked coming in third, followed by Singapore in fifth place and Australia in sixth. Cambodia, Nepal, and New Zealand were also in the top ten.
The EIU found that the biggest impediment to the decision to travel was not vaccination rates, but the potential for disruption returning home due to quarantine restrictions.
Many Asian nations are highly dependent on tourism income, with such expenditure on average accounting for more than 10 percent of gross domestic product. Island nations, as well as city-states such as Hong Kong and Macau are among the most dependent.
The EIU found that in general, those that are the most tourism-reliant, have opened up their borders first and have reaped the benefits of early pent-up demand. The Maldives and Fiji have returned to pre-pandemic levels.
North Asian countries, for which tourism is not such a large component of their economies have been slower, it said.
Another key factor that will impede tourism recovery is the lack of Chinese visitation as Beijing sticks with its zero-Covid policy. The EIU said that out of 28 countries in its index, 13 relied on China as a top source of income, which will slow growth in Vietnam and Cambodia in particular.
Risks that could derail the nascent recovery this year include the return of a more virulent strain of Covid, or higher oil prices translating into higher airfares. In general, higher global prices may also eat into the spending power of consumers, squeezing discretionary spending.