China’s luxury shoppers may opt for Hainan, Macau over Europe destinations

Luxury shoppers from the mainland are likely to fly to Hainan or Macau during the Golden Week holiday that starts tomorrow instead of flying abroad, according to a report by Vogue Business, as China’s government has endorsed travel to national destinations and discouraged its citizens from traveling abroad.
Travel and consumption analysts have noted that as luxury shoppers decide on where to spend the seven-day national holiday, Hainan and Macau have emerged as favorites.
This upcoming holiday is one of the country’s largest shopping occasions, during which time many often travel out of the country for the occasion, particularly to Europe, North America and East and Southeast Asia.
However, that is not the case this year as the public is cautious about long-haul travel due to the Covid-19 pandemic. This means that trips to popular destinations such as Thailand or Italy are less likely to take place and the consumers will be diverted to domestic markets instead.
Travel analytics company ForwardKeys had expected a full recovery to 2019 levels in terms of China travel volume by the end of September.
As Chinese travelers are currently banned from 123 countries, Olivier Ponti, vice president of insights at ForwardKeys, has stressed that there are very few choices for tourism destinations.
“Bookings to Sanya [in Hainan] are already 25.5% ahead of last year,” Ponti said.
The southern end of Hainan has ranked fourth and first in the list of top destinations for group and independent travel respectively for Chinese travel agency Group.com.
Hainan has also announced a new offshore duty-free policy, extending the purchase quota from RMB30,000 to RMB100,000.
Meanwhile, since September 23, all mainland residents have been permitted to apply for Macau visas. Given the seven-day processing period, those who applied immediately may receive the visas just in time for October 1.
According to Zhang Tianbing, consumer products and retail sector leader at Deloitte Asia Pacific, the SAR is included in a promotional campaign, whereby Alibaba’s travel-service app Fliggy has offered buy one-get one free plane tickets to Macau ahead of the holidays.
This scheme is a part of its RMB10 billion worth of discounts and offers.
This implies that the city is also well positioned to attract a share of domestic luxury shoppers this year, similar to Hainan.
Earlier, brokerage Morgan Stanley estimated an average hotel occupancy rate of 80% for the Golden Week period. These five-star hotels include Four Seasons, Morpheus, Ritz-Carlton, StarWorld, and Studio City, which were said to already be fully booked. More recent estimates have put that figure between 10% and 20% city-wide.
However, it is still unclear whether a significant number of Golden Week tourists will be coming to Macau, as even the Macao Government Tourism Office has low expectations for the major holiday. The MGTO believes that reaching 50% occupancy for Golden Week would be a “good sign” of recovery.
Moreover, in a recent interview with the Times, Trip.com chairman James Liang Jianzhang shared that most Chinese travelers would not make it in time for Golden Week. However, a more meaningful recovery can be expected by November or December this year.
Trip.com’s data shows that it may take several weeks for tourists’ interest in Macau to pick up, given the lack of awareness that Macau’s borders are open.

Return-home permits now renewable on mainland

Macau and Hong Kong residents will be able to renew their return-home permits for the People’s Republic of China while on the mainland, according to the People’s Daily. This would save many people from having to apply for these permits back in their place of residence. According to the state media source, the administrative change could save applicants 180 million yuan in traveling expenses. The permits allow residents of the two special administrative regions of China to travel freely between their home city and mainland China.