How much do Chinese spend when travelling?

2017-01-18 abstract:On the morning of August 6th, the Supreme People's court held a press conference in Beijing to issue the provisions of the Supreme People's Court on Several Issues concerning the application of law in the trial of cases involving private lending. The judicial interpretation is the "guidance&

How much do Chinese spend when travelling?

A trip to Europe equals just under the average yearly disposable income of people living in the cities (2,900 Euros). As the cities in China have populations measured in millions, it goes without saying that quite a few people enjoy an income significantly higher than the average. Economic disparity is extremely high and a cause for concern for the Chinese government. Estimates are that about one third of the urban population can afford to travel.

Average daily spending by Chinese tourists ranges from around 150-300 Euros around the world. In 2013, average daily spending was US$391 (287 Euros) in Hawaii, and US$179 (131 Euros) in California. Average daily spending by Chinese tourists is estimated at 158 Euros in Spain (2011), 198 Euros in Taiwan (2013) and 303 Euros in Australia (2012).

The Chinese are also spending more than other nationalities. In 2012, the United Nations World Tourism Organization found that Chinese made up the biggest spenders on tourism in the world, with a market of US$102 billion a year and this figure grew to US$ 129 billion in 2013. For example, People’s Daily reported in July 2014 that while Chinese tourists make up only 1% of total passenger traffic in Heathrow airport, they are responsible for nearly 25% of duty-free sales there. Chinese spend three times more on luxury goods in the UK than any other nationality, and they are expected to be the highest spending tourism group in the U.S. by 2018.

Shopping is one of the highlights of travelling abroad for several reasons. Firstly, Chinese consumers are generally price conscious and consumers of luxury goods typically seek the lowest price if this is easily identifiable. Prices of luxury commodities can be at least 20 to 30 per cent higher in the mainland compared to Hong Kong or Europe as a result of the high import tariffs and sales taxes.

Secondly, gift giving is an important aspect of Chinese culture. When travelling, they tend to bring back gifts representative of the countries they have visited, often branded products otherwise unavailable in China. In addition, in the business world buying expensive gifts is a common and accepted practice and is seen as a way to show respect. Austerity and anti-corruption measures enacted by Chinese president Xi Jinping from 2013, specifically aimed at reducing lavish spending by government officials, has impacted luxury spending within China quite significantly and across many sectors, including food & beverage as well as retail. However, luxury spending by Chinese travellers abroad is still expected to continue its growth.

Last but certainly not least, despite the recent expansion of most luxury brands, the variety of luxury products available in the Chinese mainland is still limited when compared with Europe. And some brands do not offer their full range of products on the Chinese mainland. This is an additional incentive for Chinese tourists to buy when travelling overseas.

It should also be noted that not all purchases for friends that Chinese travellers make abroad are intended as gifts—it is common for Chinese to give shopping lists of products like luxury cosmetics and accessories, as well as technological products such as iPhones, to their friends who are travelling abroad, paying for them either when they make the request or when they receive the goods. Thus, a sizeable amount of shopping done by Chinese tourists may be on behalf of friends, family and colleagues at home, who are spending their money abroad by proxy in order to save money on high-end brands and products.


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