Belt & Road Initiative: The Chinese influence on Asean's tourism industry

SINCE Asean countries joined the Belt & Road Initiative (BRI), which was introduced in 2013, there have been many commitments to enhance cooperation and economic activities between Asean and China.

For instance, “people-to-people exchanges”, a pillar of the BRI has boosted two-way tourist visits between China and Asean member countries.

According to the Asean Secretariat, Chinese tourist arrivals to the region have increased rapidly from 7.31 million in 2011 to 32.28 million in 2019. This benefits the region as most Asean countries depend heavily on the tourism industry, which contributes a significant portion of income and employment opportunities to the nations.

However, the number of tourists from China arriving in the Asean region dropped dramatically in 2020 to approximately four million counts. This reflected a significant decrease compared to a year before.

The sudden drop in the number of tourists arrivals is mainly due to the Covid-19 pandemic. Since the pandemic, China has closed its borders to curb the pandemic. Similarly, the majority of the Asean countries had adopted the same strategy.

In addition to that, most of the Asean countries have practised stringent standard operating procedures such as a 1m physical distancing requirement and restricted the movement of citizens to combat the potential “wave” of coronavirus cases in the countries.

The policies have heavily affected the Asean countries’ tourism industry, which relies primarily on Chinese holidaymakers. After all, China was the Asean's largest tourist source.

Unfortunately, with the new variants of Covid 19, such as Omicron and Delta, such measures do not help in reducing daily cases in respective countries as it is more transmissible than the original strain of SARS-CoV-2.

The pandemic is heavily affecting labour markets as well as businesses. As most Asean countries such as Thailand, Cambodia, and Vietnam depend heavily on the tourism sector, many countries have no choice but to re-open their borders despite the new daily cases reaching a daily high. This is because they hope to attract more tourists from other countries, particularly China.

At the same time, the governments had put forward the propaganda of “coexist with the virus” in order to save the countries’ economies. The "new normal" life is now being practised with people resuming their daily routine with face mask-wearing when they are outdoors and frequent hand sanitising.

Although the daily cases remain high, the government is resetting measures for the people to live with the Omicron and Delta variants. Everything seemed to be as expected until the sudden case detection in a few cities in China, such as Shanghai, Beijing and Guangzhou.

As China is still practising its "zero-Covid policy" (as of April 13, 2022), China immediately announced a lockdown on its tier 1 city, Shanghai.

Whereas in Guangzhou, non-essential travel was banned. The government of China believe that given China's huge population, the zero-Covid policy and aggressive measures are the only way to avoid depleting medical resources and prevent deaths among the elderly and those with pre-existing conditions.

Hence, mass screenings and travel restrictions are carried out in order to keep the viruses at bay.

The dramatic turns of events have negatively impacted the planning of most of the Asean member countries. A few ’ governments are forced to minimise the dependence on Chinese tourists, at least for this year.

Instead, most Asean countries’ governments have changed their focus to tap into other regional markets, such as targeting tourists among the Asean members and domestic tourists.

Nevertheless, losing Chinese tourists will undoubtedly have a huge impact on the countries’ economies. As of now, the willingness to travel overseas is still low.

Furthermore, no single country within the Asean region could replace the Chinese tourists’ contributions to the Asean economy.

This shows that Chinese tourists could critically affect the Asean economy. Most Asean countries will face a very crucial challenge in the coming months, especially to figure out how to transition from emergency mitigation measures into long-term recovery stimulus measures to better support the recovery of the respective countries’ economies.

However, most of Asean member countries have released many rounds of stimulus packages prior to this and are now financially tight.

More needs to be done, particularly for those small businesses in the tourism sector that are still suffering from the impact of the pandemic.

Their situation may deteriorate if appropriate measures are not introduced. As of now, most of the tourism sectors among the Asean member countries are recovering at a snail’s pace. Therefore, it is critical for the governments to implement recovery measures to put the tourism ecosystem back on track.

Dr Foo Lee Peng is Senior Lecturer and Chairman of the Centre for Business and Policy Research at Tunku Abdul Rahman University College. The views expressed here are entirely the writer’s own.

The SEARCH Scholar Series is a social responsibility programme jointly organised by the Southeast Asia Research Centre for Humanities (SEARCH) and the Centre of Business and Policy Research, Tunku Abdul Rahman University College (TAR UC), and co-organised by the Association of Belt and Road Malaysia

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