SINGAPORE: China’s currency devaluation and slowing economy have caused enormous turmoil in world financial markets, but they have not really bothered tourists like Henry Lee.
Not yet, at least.
“I don’t even know what the exchange rate is,” the 36-year-old technology entrepreneur from Beijing admitted.
“We’re just here to relax with our kids. We’re not making any big purchases. I bought a Tumi bag, and I got a Tiffany bracelet for my wife,” said the father-of-two during a visit to Singapore’s Merlion Park, which faces the massive Marina Bay Sands casino complex, a favorite destination for Chinese visitors.
Lee is among tens of millions from China’s growing middle class who travel across the globe every year for leisure.
A record 117 million Chinese traveled overseas in 2014, according to the Sydney-based Centre for Asia-Pacific Aviation (CAPA) —more than double the 57 million in 2010—and experts expect that trend to continue.
“The short-term outlook for Chinese outbound visitors remains strong and the long-term is bright,” CAPA said in a report issued Thursday.
Beijing’s surprise devaluation of its currency on August 11, which is now trading at a four-year low against the dollar, has sparked fears China’s big-spending tourists will start staying at home.
Shares in tourism-linked businesses such as hotels across Asia have tanked, while Cathay Pacific’s chief executive has been forced to reassure investors the airline’s future was secure.
Businesses on the ground, however, say more relaxed visa policies and the strength of the yuan against Asian currencies mean Chinese tourists will remain not only the most numerous, but also some of the biggest spenders.
“It’s not uncommon for a Chinese VIP player to gamble well over a million US dollars per trip,” said Aaron Fischer, regional head of consumer and gaming research at brokerage and investment group CLSA. “There’s probably 5,000 of them.”
The financial clout of China’s travellers can be eye-popping.
According to China’s state news agency Xinhua, Chinese tourists spent $164.8 billion in 2014, a four-fold increase compared to 2008. A whopping 88 percent of that was on shopping, it said, citing the China Tourism Academy, a government agency.
Japan alone saw more than 550,000 visitors from China in July, a figure more than double the same period a year ago, and the average Chinese tourist spends around $1,100—about twice as much as the next-highest spending cohort—according to the Japan Tourism Marketing think-tank.
Fischer predicted that the yuan’s depreciation would not hinder Chinese from traveling but some may become more cost-conscious, particularly when it comes to luxury items.
It is precisely that concern that is worrying organizations like the Indonesian Association of Travel Agencies.