China's real estate woes hit tourism

Once upon a time - in 2019 tourists from China were among the best-travelled in the world.

- ZHIYONG YANG

They collectively spent more than US$250 billion abroad - nearly twice as much as their nearest competitors, the Americans and logged more than 150 million departures on international flights that year.

The Covid-19 pandemic shook the Chinese travel industry, as it did the world's. But despite the easing of pandemic restrictions and a global tourism rebound Chinese tourists have been slow to return to the global skies. The reason, interestingly enough, could be found in the very land and houses Chinese planes fly over.

As a professor of marketing who specializes in consumer psychology, I'm interested in how China's struggling real estate sector is dragging down consumer spending - and having an effect on tourist destinations around the world.

To understand the issue, first you need to understand China's current real estate crisis. Just how bad is it? China's largest developer, Country Garden, lost $7.1 billion in the first six months of 2023; investors concerned about potential debt default have sent its stock plummeting.