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Economy

China's travel caps to damp holiday visits to Japan, South Korea

Overseas trips by Chinese during National Day break likely won't grow this year

Travelers at an airport in Dalian, China.

DALIAN, China/GUANGZHOU -- This year's National Day break in China, beginning Sunday, will last for eight days instead of the usual seven. Yet the number of Chinese cross-border tourists during that period is expected to remain flat for the first time in years, due to a set of travel restrictions.

A survey by The Nikkei found that travel agencies in at least 14 major Chinese cities have been ordered to cap the number of group tours to Japan.

A travel agency in Jinan, a city in western China, said it was told to limit the number of tourists to Japan starting with reservations for September. Earlier the same month, authorities in the port city of Dalian sent out a notice to booking companies that only 4,000 people in the entire city of several million are allowed on Japanese group tours between October and December.

That directive would cut the number of tourists from Dalian in half. "Japan accounts for 70%" of sales, said one travel agent in the city. "Our business is going to suffer."

Restrictions have also been reported at Harbin, Tonghua, Shenyang, Urumqi, Zhengzhou, Yantai, Qingdao, Weifang, Wuxi, Fuzhou, Zhangzhou and Chongqing.

Vanishing tourists

An increasing number of tourists holding fake passports have vanished once entering Japan, becoming unauthorized foreign workers, according to travel industry insiders from Fujian Province and elsewhere. Domestic authorities are apparently issuing travel caps to stem the tide.

Officials also have other tools at their disposal. "Authorities levy heavy fines whenever a traveler disappears in Japan," said a representative at a Shandong Province travel agency. "We require Japan-bound travelers to pay a security deposit of nearly 2.6 million yen ($23,080) per person."

Such a hefty sum would of course cut the number of willing tourists. "The travel limit will not be lifted before the end of the year," predicted the same source, which would only worsen the impact.

On the other hand, Shanghai and other major metropolises, from where most of the Chinese visitors to Japan hail, are not subject to travel caps. That is because it is tough to implement those rules in big cities, said an executive at a leading travel agency.

The manager believes the number of Chinese tourists to Japan will not drop by much. Last year, that figure rose by 28% to 6.37 million.

Diplomatic row

Things are decidedly less rosy for South Korea, which deployed the Terminal High Altitude Area Defense anti-missile battery, provoking the ire of Beijing. The number of Chinese traveling to South Korea is expected to sink by a large margin.

One travel company in Guangdong Province said it has stopped offering tours to South Korea for the time being. The nation has been the agency's No. 1 overseas destination during last year's National Day break. But in March, government officials stopped issuing visas for group travel to South Korea -- part of a series of retaliatory actions against Seoul's THAAD decision.

As a result, the number of Chinese travelers plummeted 70% in July from a year earlier. That is roughly the same drop-off projected for next week's holiday, which would likely cost South Korea about $440 million in lost profits at the low end.

Thanks to rising incomes and looser visa requirements, the number of Chinese traveling overseas has increased each year since 2000. The figure last year reached 122 million people, up 4% from 2015.

The National Day festivities, which accounted for $180 billion in consumer spending last year, represent the peak of that tourism. Ctrip.com, the biggest online travel agency in China, estimates the overseas tourist count during the eight days will top 6 million, which will be on par with 2016. 

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