News of the ban lift subsequently sent ripples of optimism through the tourism, retail, and hospitality sectors, which had weathered restrictions over the past three years due to the pandemic. In fact, Chinese travel service provider Ctrip reported a more than 20-fold surge in searches for outbound travel, with the highest searches for Japan and South Korea. The resurgence of outbound tourism, a market valued at a staggering 270 billion USD, is expected to infuse renewed vigour into these industries.

The luxury goods and cosmetics sector also witnessed a notable uptick in stock prices globally following the announcement. Hermès Group’s shares climbed 3.2% to 2,138.80 USD per share, while LVMH’s shares rose by 3.43% to 910.67 USD per share. Similarly, in the cosmetics sector, L’Oréal Group’s shares rose by 3.2%, reaching 457.29 USD per share, while Estée Lauder Group’s shares increased by 2.26%, closing at 169.94 USD per share.

According to the World Tourism Organization, China led the world in outbound tourism in 2019, with 166 million Chinese tourists contributing to a staggering 270 billion USD in total consumption. The resumption of group travel holds profound implications for international and domestic travel agencies, with industry experts anticipating a robust revival. Xu Xiaolei, Chief Brand Officer of CYTS, predicted that Chinese outbound group tours in 2023 could reach 60% to 80% of the levels witnessed in 2019.

In a McKinsey report titled “China’s Tourism Industry Outlook 2023”, Australia, New Zealand, and Southeast Asia topped the list of Chinese respondents’ preferred travel locations. Meanwhile, European tourism experienced a decline in interest compared to previous years, except among affluent individuals with monthly household incomes exceeding 38,000 RMB (5,234.66).

With this landmark announcement, China is poised to propel its outbound tourism industry to greater heights, fostering economic recovery and strengthening global tourism markets. However, this outcome hinges on whether the now-liberalised group travel steers Chinese citizens away from the swiftly burgeoning trend of domestic travel.

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Coviccine Trivalent XBB.1.5, which was developed by scientists at WestVac Biopharma and West China Medical Center (Sichuan University), reportedly has 93.28% protective efficacy against the subvariant. Efficacy describes how well the vaccine protects against disease under highly controlled clinical trial conditions, but its outcome usually varies when deployed in the real population.

The emergency approval comes weeks after a WHO advisory group announced that COVID booster shots should now be updated to produce antibodies against the XBB variants and not the original COVID variant, which no longer circulates in humans. 

XBB.1.5, which is a highly infectious subvariant of omicron, led to China’s first major re-infection since the government scrapped its controversial zero-COVID policy in December. The current surge is expected to peak at 65 million weekly infections by the end of June, according to data modelling by respiratory disease specialist Zhong Nanshan.

Nationalist newspaper The Global Times said the vaccine approval “highlight[s] China’s leading position in COVID-19 vaccine research and development”, but many commentators are still concerned about the accuracy of the Chinese authorities’ COVID data.

In its most direct criticism of China since the pandemic began, the WHO pointed to China’s narrow definition of COVID-related deaths as “underrepresent[ing] the true impact of the disease” earlier this year. Whilst there is no evidence that current XBB subvariants cause more severe symptoms than other omicron variants, complete data remains key to tracking this as new variants continue to emerge.

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The new store is comprised of 3,000 square metres, debuting the MUJI Farm for the first time in China, and providing organic food and farm-to-table dining experience for local consumers, along with selling homeware items, everyday apparel, beauty cosmetics and daily use products. 

“MUJI Farm” is centralised on growing healthy vegetables in organic garden soil with a minimal amount of agricultural chemicals. In partnership with a Shanghai farm, freshly harvested spinach, beetroot, cabbage, curly kale and other types of seasonal veggies will be delivered to the MUJI store within 24 hours. Consumers are encouraged to enjoy salads produced using locally grown ingredients in the MUJI Diner canteen, driving the farm-to-table lifestyle concept.

As for the MUJI Farm proposal, “it was inspired by the growing health awareness among Chinese citizens,” according to the spokesperson for MUJI China. By doing so, the Japanese retailer can deliver pleasantly-tasting products with guaranteed quality to local consumers. Apart from the farm-fresh vegetables, the MUJI Wine and Tea Workshop also made their first appearance at the newly opened storefront, coming with a wide array of options to cater to the tastes of different demographics.

The massive COVID outbreak in China led to the country’s booming awareness and pursuit of healthier lifestyles. In terms of purchasing foods, good-quality and fresh, price-setting as well as green and healthy have become the top three factors which influence consumers’ decisions, as per a consumption report released by Deloitte.

As such, debuting the MUJI Farm in Shanghai, the international city renowned for its modernism, showcases the Japanese retailer’s insightful observation towards local consumer trends and the green food industry. With the country’s economy getting back on track, consumer traffic is noticeably increasing, and MUJI remains bullish of the market landscape and envisions future sales growth.

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Travel-related bookings saw a 6-fold surge in the lead-up to the celebration. Of which, cross-provincial orders made up nearly 80%, while overseas trips saw record high bookings in three years according to a report by Alibaba-owned online travel agency Fliggy on 11 January.

With eager travellers re-exploring inside and outside the country during the largest annual celebration and one of the longest national holidays, Dao Insights outlines some of the top destinations that drew in the highest footfall during the festive season.

Winter-sun destinations

Places with warm weather have been the backbone driving the recovery of long-distance trips as tourists seek to escape the winter cold. Searches for domestic long-distance travel products are reported to have increased 20 times as of 8 January, with “islands” topping the trending list.

The top three most visited regions are those famous for its tropical climate, including Xishuangbanna (an autonomous prefecture in Southwestern Yunnan province also known for its Dai ethnic culture), Sanya, a renowned tourism hotpot situated in the Southern end of Hainan province, and Dali, a city also in Yunnan province which has mild winters.

Meanwhile, niche islands have also been the go-to for young travellers and those travelling with families who want to avoid the crowds at mainstream resorts, while not missing out on the sunshine. As a result, Weizhou Island (the largest island of Guangxi Zhuang Autonomous Region in Beihai city), Nan’ao Island (a county of the prefecture-level city of Shantou in Guangdong province), and Qiandao Lake (or Xin’anjiang Reservoir, a human-made, freshwater lake in Hangzhou, Zhejiang province) were the most popular destinations.

While others such as Aranya, Boundary Island, and Dongshan Island are also among the top 10 attractions for those island goers, as per Mafengwo the dubbed “travel bible” by younger Chinese netizens.

Winter wonderland with ice and snow

In sharp contrast to those swarming to warmer climes, others have decided to embrace the wintry chill, propelling ice and snow tourism to become a trending travel theme too. Changbai Mountains, a major mountain range in Northeast Asia spanning the Northeast Chinese provinces of Heilongjiang, Jilin, and Liaoning has been one of the sites drawing in the most interest from long-distance trip-goers.

The active stratovolcano on the Chinese-North Korean border saw overall searches up by 100% on the eve of the festive weekend starting on 21 January. Of which, 90.3% of queries were from tourists outside the region, with dwellers in the coastal province of Guangdong making up the highest percentage at 13%, as per state media People’s Daily.

While other traditional, natural ice wonderlands such as Harbin, capital of China’s Northernmost province Heilongjiang retains its appeal, humanmade ice and snow resorts in major cities have emerged as tourism hotspots too. Beijing Shichahai Ice Stadium recorded a 76% increase in online searches during the festival week while indoor ski fields in Guangzhou and Changsha were also gaining steam, up 50% in related queries, according to Tongcheng Travel.

Hidden gems for cultural tourism

Small counties and towns demonstrating traditional folk culture and historical heritage have also been sought after during the latest travel boom. Searches for “New Year-themed ancient town” increased by 50%.

Wuzhen, a historic scenic town in the North of Zhejiang province, Gubei Water Town, located in Simatai Village at the foot of Simatai Great Wall in Beijing, Furong Ancient Town, in Northwest Hunan province, Zhouzhuang, a town in Jiangsu province famous for its canals, and Nanxun, a historic town in Zhejiang province are places seeing the most nostalgic visitors.

Also under the spotlight are cities with rich history, such as Xi’an, home to the Zhou, Qin, Han and Tang dynasties’ ruling houses and also marks the end of the Silk Road’s Eastern end, and Luo Yang in the West of Henan province and is one of the cradles of Chinese civilisation, along with others including Jinan in Shandong province, Chengdu, capital of the Sichuan province and Zhangjiajie, in Northwest Hunan province famed for its jagged quartzite, sandstone columns.

Travel packages incorporated with intangible culture and national history have also drawn in great interest among China’s young tourists, according to Fliggy. Meanwhile, registration for activities with cultural experiences including dressing up in Han costumes and traditional handicraft making has also doubled compared to last year.

Neighbouring regions for outbound travel  

Tens of thousands of people crossed borders in both directions between Hong Kong and Mainland on the same day that cross-border quarantine requirements were removed. This was coupled with the resumption of the processing of endorsements for Chinese mainland residents to visit the Hong Kong Special Administrative Region for tourism and business purposes.

Fast channels at ports adjacent to Hong Kong and Macau are also set to return to normal with passenger clearance at water ports and entry and exit of international cruise passengers at selected ports are also set to resume in a timely manner.

It was reported that nearly a million Mainland Chinese residents applied for entry permits to Hong Kong, Macau, and Taiwan – up 147.6% since before the implementation of the policy change, according to Liu Haitao, director general of the National Immigration Administration’s department of frontier inspection and management.

Following the easing of travel restrictions, Hong Kong and Macau have taken the top spots on the list of popular outbound travel destinations among Mainland tourists. While surrounding countries in Asia such as Thailand, Singapore, and Malaysia are also desired by those who are looking for an exotic experience.

Bookings of flights to Hong Kong made by yearning Mainland tourists clocked a 31-fold year-on-year increase, and reservations for hotel and tourism attractions also recorded more than double growth, as per Ctrip. Meanwhile, Macau saw inbound travellers from Mainland up by 97% and hotel bookings up by 57%, while ticket purchases for scenic visits rose by more than 133% compared to last year’s Spring Festival.

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According to the joint announcement published by EASA and ECDC, in the current situation, the guidelines are directed at all incoming passengers to the EU from China, aiming to limit virus transmission during air travel as well as focus on the early detection of emerging new variants.

These latest measures will be implemented with immediate effect for passengers on direct and indirect flights arriving from China, including pre-departure negative COVID testing; onboard medical face mask wearing; enhanced aircraft cleaning; crew member vaccination status assignment; random PCR testing and sequencing upon arrival, and flight wastewater monitoring.

After the news was reported in China, a heated discussion broke out on Weibo, China’s biggest microblogging site, with the relevant topic drawing in over 130 million views and the figure is still growing.

Varying comments can be observed online with some netizens expressing strong criticism over this decision, suggesting it was obvious prejudicial treatment towards China, while others displayed anger on the self-imposed nationwide isolation over the past 3 years.

Prior to the EU-unified approach in aviation, many countries had tightened rules on air passengers from China in the last week, including the United States, Australia, Japan, South Korea India, to name a few, amid concerns over China’s lack of transparency around the scope of the COVID outbreak and worries of new variants.

Regarding this matter, China halted visa issuance for visitors from Japan and South Korea on 10 January. During a press conference in Beijing, Chinese Foreign Ministry spokesperson Wang Wenbin stated that this was “a reciprocal measure in response to the discriminatory entry restriction targeting China.”

After China’s recent decision to lift the several year-long isolation and reopen its borders, the nation’s daily infection cases have been hitting record-highs daily and has not yet reached its peak. The country’s worsening epidemic outlook currently looks bleak but is expected to be temporary as many countries in the world went through the same phase.

While the tightened COVID measures will more or less affect the tourism industry and business development with European countries, Chinese travellers may turn to other regions with looser entry rules for vacation and investment.

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According to a statement issued by the Chinese Embassy in South Korea on January 10^th, short-term visas for South Korean travellers have been suspended, including visas for business, tourism, and medical treatment. No information was given about the length of the suspension.

This move follows Seoul’s December 30^th announcement of temporary COVID-19 testing requirements for travellers arriving from China, as well as limited flights and visa restrictions. Other countries that have imposed restrictions following China’s rapid opening of borders include Japan, the USA, Malaysia, India, Italy, the UK, France, Israel, Spain, Morocco, Australia, Canada, Thailand, and Qatar.

Prior to the statement released on January 10th, Qin Gang, China’s Minister for Foreign Affairs, spoke over the phone with South Korea’s Foreign Minister on January 9th. Qin expressed deep concern over the new restrictions and said he hoped that South Korea would uphold an “objective and scientific attitude”.

Mao Ning, the government spokeswoman for the Chinese Foreign Ministry, previously criticised the restrictions, stating that they were not based on science and that the use of COVID measures for “political purposes” would be rejected by Beijing. She also stated that “the principle of reciprocity” would be applied to countries imposing measures targeted at Chinese travellers.

It is not clear why South Korea was targeted, however relations between the countries have cooled considerably over the past few years following the 2017 crisis that erupted over North Korea’s missile defense system.

As life within China’s borders gradually returns to normal, the country’s pandemic response continues to pose significant challenges for diplomatic relations with neighbouring countries and beyond. In the coming weeks, more countries may be forced to weigh up the threat of Chinese visa suspensions against the danger of greater viral spread within their own borders.

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Starting on January 8, hotel quarantines will no longer be required for inbound travellers. Vaccinated or not, passengers entering China will now only need a negative PCR result within 48 hours before departure in order to enter China with no need to apply for a health code. However, the latest quarantine-free policies do not apply to the tourist visa or 10-year visa, which may remain suspended until the second quarter of 2023. 

As for Chinese citizens, not only will lockdowns of entire neighbourhoods be a thing of the past, but the government has also resumed processing visa and passport applications for Chinese citizens to travel abroad. According to data from the travel-booking company Trip.com, outbound flight bookings skyrocketed nearly 300% as of December 27 following the announcement to change border restrictions. As such, this sets up a potential flood of millions of Chinese tourists going overseas ahead of the Chinese Lunar New Year holiday.

While many Chinese citizens are enthused by the sudden prospect of future travel, not all countries are equally on board. Given that the sudden U-turn of governmental policies has caused an enormous wave of COVID infections nationwide, combined with the concern about the accuracy and reliability of China’s case and mortality data, several nations worldwide have begun implementing new COVID precautions against people travelling from China.

At present, the countries that impose COVID-19 restrictions on China include Japan, South Korea, the USA, Malaysia, India, Italy, the UK, France, Israel, Spain, Morocco, Australia, Canada, Thailand, and Qatar. 

During a press conference in Beijing on January 3, Chinese Foreign Ministry spokeswoman Mao Ning criticised the new entry restrictions that target only passengers from China as “unacceptable” and “excessive”, stating that the epidemic control response lacks scientific merit. The government spokeswoman went on to say that Beijing would consider reciprocal measures against countries that sought to limit travellers arriving from China.

“We firmly oppose the practice of manipulating epidemic prevention and control measures to achieve political goals, and will take corresponding measures according to the principle of reciprocity,” Mao said.

Restrictions or not, as China gradually dismantles its stringent COVID measures and pivots its strategy to living with the virus, its new quarantine-free policies will eventually pave the way for Chinese residents to travel abroad, creating business opportunities both at home and overseas.

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As the name suggests, ‘online bars’, sell alcohol online. Entrepreneurs make their own drinks at home (typically served in large, plastic bottles) and sell them on online platforms such as Wechat, Douyin, Xiaohongshu, and Meituan, and provide consumers with door-to-door delivery services. The model provides a win-win for both sellers and buyers, as sellers can save on the high cost of opening a store, and buyers on a budget can receive affordable yet freshly prepared drinks and snacks without having to step foot outside.

Such online services are especially popular among college students and those 25 and under who actually get more bang for their buck by purchasing online instead of going to a physical bar. In fact, where the per capita consumption of offline bars amounts to over 200 RMB, online services barely cost over 100 RMB including a set meal. Moreover, many young Chinese people have taken up the model as their own side business, with some boasting earnings of up to 80,000 RMB (11,477 USD) per month.

As for its appeal, the business sells value, service and a sense of ritual or ceremony. Not only do merchants deliver top-notch service, but they also give a sense of ritual that includes dice, playing cards and snacks, which creates the ideal party atmosphere for watching movies or chatting.

The first ‘online bar’ appeared at the height of the pandemic about six months ago. Then, with the arrival of the 2022 FIFA World Cup, the trend exploded on Chinese social media. Nowadays, a quick search on Xiaohongshu will easily result in nearly 10,000 related posts. Meanwhile, the subject piqued users’ interest on Weibo, with the hashtags “Can online taverns really earn 80,000 a month?” and “Why are online taverns so popular?” amassing 21 million and 2 million views respectively.

According to data from China Industry Information Network, Chinese bar consumption in 2019 was mainly divided into two groups: 18-24 year-olds accounted for 57% of consumers while 25-34% year-olds accounted for 28% of consumers. As such, China’s post-90s and post-95s currently hold the most potential for alcohol consumption. Meanwhile, according to Statistica, while sales revenue in pubs and bars in China remained relatively flat between 2016 and 2020 at six billion USD, the market is forecasted to grow more than two-fold to 14 billion USD by 2025.

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Chinese authorities announced the easing of COVID rules in the wake of nationwide anti-lockdown protests triggered by the deadly fire in Urumqi which killed at least 10 people and left 9 injured on 24 November. Included were major Chinese cities such as Beijing, Shanghai, Shenzhen, Chengdu, and Changsha, where COVID testing requirements for entering most public places was removed.

With China’s economy on the road to recovery, this has sent positive signals to global luxury companies since China has become the world’s second-largest luxury consumer market, which explains the massive boost to stocks.

Such confidence was seen during this year’s fifth annual China International Import Expo in Shanghai which ended on 10 November. Global luxury giants including LVMH, Burberry, Canada Goose, and Kering leveraged this international event to actively deliver their brand culture and showed their commitment to the market, despite a slowdown in growth over the last few months.

Since the COVID outbreak in Shanghai this March, China’s major players in the luxury sector were in despair. According to research by HSBC, Burberry saw a 40% reduction of sales in China, which is due partly to store closures in May 2022 with local lockdowns taking the blame.

The country’s endless COVID lockdowns have long been taking a toll on China’s wider economy, which was reflected in this year’s Double 11 online shopping festival. The world’s largest online shopping extravaganza did not reach the feverish growth as recorded in previous years. And for the first time, key e-commerce platforms such as Alibaba and JD.com kept quiet about their revenues.

All these findings paint a complex picture that consumers are displaying a conservative attitude to the economy and are more cautious about spending. While China is moving away from zero-COVID, with the fact that luxury goods have always been in high demand there, the outlook of the luxury conglomerates in China is hopeful.

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The financial hub of Shanghai, which underwent a harrowing two-month lockdown earlier this year, has scrapped PCR testing requirements to enter outdoor public venus from parks to public transportation and other tourist attractions. According to a statement revealed by local authorities, these new measures will “continue to be optimised and adjusted” in accordance with national policy as well as the local situation.

Meanwhile, in Hangzhou, testing requirements were also dropped to enter most public venues and tests will no longer be required to purchase certain medicine. On the morning of December 6, some Chinese netizens discovered that the 3-day countdown to Hangzhou’s health code was removed entirely and that the entry report on the homepage showed that it had been suspended. On the Chinese microblogging platform Weibo, the hashtag “Hangzhou Health Code Nucleic Acid Countdown Canceled” has garnered a whopping 81.9 million views.

While the loosening of some of these restrictions portrays the latest COVID variant to be less severe, it is still unclear whether or not life in China will fully reopen and return to normal life. Currently, analysts warn that a loosening of COVID controls could very well lead to a resurgence of infections and continue to suppress economic activity. As such, this has fuelled a mix of relief and worry as the public waits to see the potential health consequences of the country’s COVID exit strategy.

Such worries, however, have not dampened the spirit of Chinese citizens, who celebrated the removal of testing booths and other measures as a partial victory and the “beginning of the end” of China’s stringent zero-COVID policy. As of Monday, December 5, China has reported 28,062 new COVID infections, down from 30,014 cases a day earlier.

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