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Vijay Eswaran on How China’s Reopening Boosts Tourism in ASEAN

China’s Reopening Boosts Tourism in ASEAN

In 2019, the Chinese tourist industry raked in an astounding 6.6 trillion yuan — around $9.1 trillion. That income stream came to a crashing halt with the COVID-19 pandemic, but three years later, tourism is clawing its way back in the Far East — and thought leader and philanthropist Vijay Eswaran believes this can only benefit the 10 member states of the Association of Southeast Asian Nations (ASEAN).

“Tourism is on the rise fueled by the pent-up demand of mainland Chinese visitors, while trade is being reinvigorated, driven by Chinese consumption of goods and services in the region,” Eswaran wrote in Thailand’s English language daily The Nation. “Furthermore, Chinese investment is expected to resume, with the Regional Comprehensive Economic Partnership (RCEP) further accelerating investments between China and Southeast Asia, particularly in the manufacturing sector.” 

China’s role in the world economy when it comes to tourism cannot be overstated. While domestic figures are staggering on their own (208 million internal trips for the 2023 new year holiday alone), outbound travel amounted to $255 billion in spending for 2019. These figures are expected to rebound post-pandemic, with Southeast Asia listed as a top-three destination alongside Australia/New Zealand and Japan. Bookings increased year over year by 640%, with Bangkok, Singapore, and Kuala Lumpur, Malaysia, leading the way as top places to visit. In addition, ASEAN prides itself on being a single tourist destination with continued plans to refine infrastructures and improve the ease of intra-ASEAN travel. 

Vijay Eswaran: Thailand and Singapore Are ‘Major Beneficiaries’

Analysts should consider the dual impact of an increase in foreign travelers to the region, ready to explore China once more, alongside the additional flexibility Chinese travelers now have, allowing them to visit other nearby countries. Traditionally, many ASEAN countries have benefited from an influx of Chinese tourists. 

“Chinese tourists have always been a significant contributor to the tourism industry in the region,” Vijay Eswaran wrote, “with countries like Thailand and Singapore being major beneficiaries. In Thailand, Chinese tourist expenditure was equivalent to 3.2% of their respective nominal gross domestic product (GDP) in 2019. This year, the country is expecting five million Chinese visitors.”

Singapore has also experienced an uptick in Chinese tourists in recent months, seeing 124,000 already in 2023 — nearly the entire total seen throughout 2022.

The border reopening for China may also have continued positive effects on trade and investment opportunities within the ASEAN region. These countries are already looking to improve and expand on existing trade relationships with one another, making it easier to conduct business and grow the region’s economy. Enhanced ties with China, including more direct ways to import and export products, can allow ASEAN brands to expand their e-commerce operations with more streamlined access to goods as well as Chinese consumers. Vijay Eswaran shares that ASEAN nations could also economically benefit from more thorough integration with China’s Belt and Road Initiative, designed to enhance global infrastructure and streamline border crossings to improve trade and create jobs. 

Additionally, Eswaran notes that ASEAN nations need to be cognizant of China’s place in growing geopolitical tensions and how they can help allay these issues. “The resumption of travel between China and the region can serve as a catalyst leading to constructive dialogue,” explained Eswaran.

To do this, ASEAN countries need to take charge of their own tourism and commerce industries, demonstrating to the world that they can achieve progress and productive relations with China as a trade and travel partner. This has become even more pivotal as relations between China and the West have worsened while the conflict between Russia and Ukraine continues. With tenuous global connections often restricting commerce across industries, ASEAN nations can take the reins in having responsible interactions that promote peace.

This peace is important in more ways than one, Vijay Eswaran explained. “With China as a predominant trading partner, ASEAN countries need to ensure that the tensions between China and the U.S. do not boil over and that they continue to trade peacefully.” Furthermore, “ASEAN could facilitate dialogue between the U.S. and China to promote understanding and reduce tensions.” 

This role isn’t new to the association, which often works to bring about peaceful resolutions to conflict within the region. For Eswaran, ASEAN stands at a crossroads where it can choose to engage on the world stage to encourage stability for the global economy. This is partly due to its unique position as a regional trading partner that can understand both the political concerns of the U.S. and the economic concerns of the Chinese government. As the third-largest economy in Asia, ASEAN holds many of the keys to streamlining negotiations between rival countries and bringing increased opportunity to the region as a whole.

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