Home Hotel industry China’s tourism sector feels tight in third quarter amid sporadic COVID-19 cases

China’s tourism sector feels tight in third quarter amid sporadic COVID-19 cases


Tourists admire the fall scenery on a plank road in the Longtoushan Scenic Area in Hanzhong, northwest China’s Shaanxi Province, October 28, 2021 (Xinhua / Tao Ming)

China’s third-quarter tourism industry was hardest hit since 2020, due to stringent epidemic prevention and control measures following recent COVID-19 outbreaks, including suspension of cross-provincial travel in many parts of the provinces, businesses and industry affected by the epidemic. Analysts said Tuesday, with some estimating a more than 10% drop in tourism in the quarter.

As of October 31, at least 27 large listed companies in the tourism and hospitality sector had released their third quarter results. More than half reported net losses and more than 60% saw lower year-over-year profits, due to the impact of sporadic COVID-19 outbreaks over the summer, new reports said Monday.

The number of third-quarter tourist arrivals fell by more than 10 percent, a relatively serious result since last year, an industry insider told the Global Times on Tuesday on condition of anonymity.

“The second half of this year is certainly not optimistic, and it will be weaker than the first half, given the hard work of preventing and controlling the epidemic in various locations,” the person said.

From January to October 2020, there were 22,794 travel agencies in China, but their number fell in 2021 to 20,892, a drop of around 8%, as licenses were canceled or revoked, according to data from the Qichacha online business indexing platform.

Li Lin, an employee of a Beijing-based travel agency, said recent sales performance was not optimistic, especially in October, when the National Day holiday was to be the last peak period for travel this year before dawn from low season to winter.

“But more than 60% of trans-provincial orders were canceled in October alone after the epidemic prevention measures were tightened,” Li said, adding that the measures were understandable given the spread of the epidemic in various parts of the country.

Some large national tourism agencies such as Guilin Tourism Corp also suffered losses. The company said that in the third quarter, its operating profit fell 13.2 percent year-on-year to 65.45 million yuan ($ 10.23 million), and recorded a net loss. of 34.05 million yuan.

But not all industry players have felt the impact. A general manager of an international five-star hotel in southern China’s Guangdong Province told the Global Times on Tuesday that third-quarter business was slightly better than last year, as the property primarily caters to business travelers and not tourists.

Since October of this year, there have been several local epidemics, involving 11 provinces in one week.

In response, the Department of Culture and Tourism issued an emergency notice on October 23, demanding the strict implementation of the “circuit break” mechanism for the management of interprovincial tourism operations.

For provinces and cities, where there are high-risk areas, travel agencies and online travel sites should suspend all interprovincial group tours, as well as airline tickets and hotel package services in the region, media reported.

“The performance of the third quarter was not only the current pressure of epidemic resurgences, but the overall response to the lingering pressure,” Yang Jinsong, senior expert at the Chinese Academy of Tourism, told the Global Times on Tuesday.

But Yang said the situation is temporary and there is no need to be too pessimistic, as preventing the outbreak will result in safer travel flows and the market will surely rebound, Yang said.

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