China Tourism Law Hurts Packaged Tours, Boosts Independent Chinese Travelers

The tallies are in and a new Chinese tourism law clamping down on abuses in Chinese package tours for outbound travelers led to decreased visitor numbers in Taiwan, New Zealand, and South Korea.

However, all three destinations report that the detrimental impact of the new law, which went into effect October 1 and triggered price increases from outbound tour operators, was partially offset by the rise of independent travelers, who tend to stay longer in these destinations, according to the Chinese Outbound Tourism Research Institute.

The new China law on outbound, packaged tours banned traditional practices of forced shopping and payments for activities not covered in the fixed tour itineraries.

Banning these activities means that tour operators no longer receive payments from tour guides and stores paying for these activities, and the tour operators then raised prices, which led to the drop-off in visitors.

COTRI reports:

• Taiwan's arrivals from China in October 2013 were two-third of the visitor numbers from China in October 2012. However, visitor numbers were back at the October 2012 levels during the first half of November 2013.
• New Zealand's visitor numbers from China saw decreased 12% in October 2012, the first drop since 2010, although the average length of stay increased.
• South Korea saw its visitor numbers from China fall about 20% during Golden Week, the first week of October, and authorities blamed it on the new tourism law.

Wolfang Georg Alt, editor of China Outbound Market Intelligence magazine, says the price hikes by the China outbound tour operators in response to the new law helps close the gap between the price of packaged tours and do-it-yourself tours by Chinese travelers.

"The tourism law will therefore bolster the already growing segment of the self-organized travelers and will also make this kind of travel organization more attractive for less affluent travelers," Arlt says.