Japan seeing travel demand recovery after border control easing

https://www.japantimes.co.jp/news/2022/11/13/business/economy-business/japan-tourism-rebound/

Japan’s tourism and airline industries are seeing a rebound in travel demand one month after the country drastically eased COVID-19 border controls.

The government relaxed its border control measures and launched a nationwide travel discount program on Oct. 11.

“Reservations by foreigners more than doubled,” Yoshinari Furuta, senior managing officer of hotel operator Seibu Holdings, said Thursday.

Furuta said that bookings from the United States, Singapore and Australia especially grew after the easing of the border controls, including the lifting of a ban on foreign individual tourists.

The discount program is also helping to boost travel demand. Seibu’s accommodation bookings surged especially in resort destinations, with reservations for December climbing about 10% from the same month of 2019, before the pandemic.

KNT-CT Holdings, the parent of Kinki Nippon Tourist-brand travel agencies, is also seeing domestic bookings for December surpassing pre-pandemic levels. The company predicts demand from inbound tourists to recover to around 70% of pre-pandemic levels the next fiscal year.

A weaker yen also is fueling demand from foreign tourists. “The recovery is faster than expected,” KNT-CT CEO Akimasa Yoneda said.

Airline ANA Holdings said that the daily number of foreigners traveling to Japan on its international routes grew 2.5 times from September.

ANA expects the number of passengers on its international flights, including those departing Japan, to recover to around 60% of pre-pandemic levels by the end of this fiscal year. President and CEO Koji Shibata said the figure “may swing higher.”

Consumption by foreign travelers is also recovering. Duty-free sales at Isetan Mitsukoshi Holdings Isetan department store in Tokyo’s Shinjuku between late last month and early this month have regained pre-pandemic levels.

Chinese customers, which once made up a bulk of foreign clients, have not returned fully due to Beijing’s strict zero tolerance approach to COVID-19. Still, Isetan Mitsukoshi President and CEO Toshiyuki Hosoya said that “customers from countries other than China are coming.”

Despite the uptick in tourism demand, causes for concern remain. Travel to foreign countries from Japan has become expensive due to the weak yen and rising fuel costs. An official at a major travel agency said that the rebound in customer traffic is slow.

Fears of an eighth COVID-19 wave is casting a pall on strong domestic travel demand.

Many hotels are unable to offer all of their rooms despite increased bookings, due to many employees having left their positions during the pandemic.

It is difficult to call them back at the same wage level as before. Yoshiteru Koyano, vice chairman of the Japan Association of Travel Agents, said that “significant costs must be paid” to secure staff.