Chinese group travel to Korea poised for a strong revival

Chinese group tours to South Korea are showing signs of recovery, about 10 months after Beijing lifted a ban on Chinese group tours to Seoul last summer, raising expectations that Korea’s tourism industry may finally be on track for a full recovery.

On Tuesday morning, dozens of tour buses pulled up in front of Lotte Department Store in Myeong-dong, one of the largest department stores in Seoul, and unloaded some 4,000 Chinese tourists who poured into the duty-free shop inside the department store building.

“It was the first time since the COVID-19 pandemic that more than 4,000 Chinese group tourists visited the store at the same time,” the store employee said, adding that the tourists spent hundreds of millions of won on luxury watches and jewelry that day.

They were employees of a Chinese cosmetics company on an incentive group trip.

The rare scene could signal the full recovery of Korea’s tourism industry, tourism industry observers said.

“China has been the final piece of the puzzle in the recovery of the domestic travel industry,” said a Korean tourism industry official. “It is expected that (Korean tourism companies) will gain earnings momentum from an increase in the number of (Chinese) group tours.”

CHINESE TOURISTS RETURNS WITH STRONG PURCHASING POWER

Before the COVID-19 pandemic, Chinese tourists still made up 34.8% of total visitors to Korea in 2019, despite the restrictions imposed by the Chinese government on group travel of its people to Korea in 2016 in retaliation for the decision of Seoul to deploy high-altitude defense of the US terminal. THAAD) missile system on its territory.

Beijing lifted the ban on group travel last August, but the return of Chinese group tourists to Korea has been slow.

However, since the beginning of this year, the growth of the number of Chinese group travelers to Korea has begun to accelerate, indicating that Chinese group tourists are returning after a seven-year hiatus.

Industry observers said their returns are partly due to the weaker Korean currency against major currencies including the US dollar and Chinese yuan.

The stronger yuan against the Korean won means stronger purchasing power for Chinese tourists in Korea.

According to data from the Bank of Korea, the yuan rose from 178.60 in July 2023 to a monthly average of 188.52 won in April this year.

Bloomberg Intelligence recently predicted that Korean duty-free shops would benefit from a boom in Chinese travel to Korea, driven by the weakening value of the Korean won against the Chinese yuan.

CLEAR SIGNS OF RECOVERY

According to the Korean travel retailer, several other tour groups from China will arrive in Korea starting this month.

According to the Incheon Metropolitan City government and the Incheon Tourism Organization, the huge coastal city bordering the capital Seoul will welcome about 10,000 foreign tourists, including 5,000 Chinese tourists, during the Incheon McGang (Chimaek) Party of 1883, scheduled for later in May.

In June, approximately 6,000 group tourists from China will stay at the Inspire Entertainment Resort in Incheon.

Jeju Island, Korea’s most famous holiday island where Chinese can visit without a visa, is another popular destination for Chinese tourists.

Direct flights between China and Jeju Island will be expanded from 127 in March to 164 in July to meet Chinese travelers’ growing demand for Jeju travel.

Chinese group tourists have spent a lot of money not only on duty-free shops in Korea, but also on various tourist spots such as palaces and traditional markets.

During this year’s May holiday, which fell in the first week of May, Chinese tourists’ Alipay and WeChat Pay transactions at Hyundai’s major department stores in Seoul increased by 87.9% compared to the same period last year.

INCREASING KOREAN VISITORS TO CHINA

Korean visitors to China have also been on the rise lately, which bodes well for Korean tourism companies as China is one of their top tourism markets.

According to Modetour Network Inc. Korean group trips to China increased by 26% in April compared to the previous month.

China is the third most popular country to visit among Korean travelers, after Southeast Asian countries and Japan.

Hanatour Service Inc. also saw a 13% month-over-month increase in Koreans’ group trips to China in April.

Of the total international group trips of Korean tourism companies, China accounts for almost 30%.

Write to Sun A Lee at [email protected]
Sookyung Seo edited this article.