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China eases domestic tourism restrictions as economy begins to grow
16 July 2020

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China National Bureau of Statistics

The China National Bureau of Statistics reported yesterday that China's economy grew by an unexpectedly robust 3.2% in 2Q2020 making it the first major economy to grow since the start of the COVID-19 pandemic, and the only one likely to avoid a recession in 2020. (See this analysis by the Economist Intelligence Unit over at my blog.)

Following the initial surge of COVID-19 in China that began in December 2019, the country's economy contracted by 6.8% in 1Q2020 as the Communist Party suspended trade and travel in most cities in order to control the spread of the virus. Although manufacturing is largely back to normal, many businesses are closed, some travel restrictions are still in place, and consumer spending is weak as up to 30% of the urban workforce remains jobless.

On 14 July, following 9 days without observed local transmission of the virus, China eased some restrictions on domestic tourism, permitting visitation of tourist up to 50% of normal capacity, as well as tourism between provinces.

One cloud on the economic horizon is relations with the US, China's largest export market, as tensions increase over trade, technology (e.g., Huawei) , human rights and Hong Kong. It was revealed yesterday that the Trump Administration is considering issuing an executive order that would ban all travel to the US by all 92M members of the Chinese Communist Party, and revoke the visas of and expel Party members currently in the US.

PRC is by far the world's largest source market for international tourism, and one of tremendous potential for the US, particularly with Canada and Mexico borders closed as they are now and Europeans being advised not to travel to the US, "the epicenter of the COVID-19 pandemic".

How will this play out? Stay tuned.

David Boggs President/CEO ACRO Global|Publisher Tourism Marketer
David H. Boggs
ACRO Global

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