Market Development: Asia Pacific Outbound Tourism and Greater China’s Travel Trends

Asia Pacific Outbound Tourism Market

The Asia Pacific outbound tourism market experienced robust growth in 2024, with sales increasing at a compound annual growth rate (CAGR) of 7.6% from 2020 to 2024, and is projected to grow at a CAGR of 6.7% from 2025 to 2035, reaching USD 296.5 billion by 2035. Key drivers include:

• Low Passport Penetration: A low proportion of passport holders in emerging markets like India and Greater China offers significant growth potential as international travel becomes more accessible.
• High-Quality Services: Enhanced tourism infrastructure, such as new international airports (e.g., Thailand’s U-Tapao International Airport and Singapore’s Changi Airport Terminal 5 under construction) and high-speed rail networks (e.g., China’s high-speed rail), supports regional connectivity.
• Tax Refund Policies: Greater China’s refund-upon-purchase system led to a 94.6% surge in tax refund sales in the first half of 2024, boosting outbound tourism spending.
• Digital Transformation and Connectivity: Low-cost carriers like AirAsia and VietJet, combined with digital platforms like Xiaohongshu and Douyin, drive travel inspiration and accessibility, particularly for younger travelers.

Southeast Asia captured 24% of Asia Pacific travelers in 2024, driven by affordability and cultural diversity, while Australia and Oceania accounted for 17%, appealing to safety-conscious and nature-seeking tourists.

Greater China’s Outbound Tourism Market

Greater China, including mainland China, Hong Kong, Macau, and Taiwan, solidified its position as a global tourism powerhouse, with approximately 160 million outbound trips in 2024, recovering to 82% of 2019 levels. In 2019, mainland Chinese tourists alone made 169 million outbound trips, spending USD 262 billion, per the United Nations World Tourism Organization (UNWTO). Key trends include:

• High-Spending Travelers: 40% of Greater China travelers, particularly from mainland China and Hong Kong, embarked on their first international trip in 2024, with 49% spending at least CNY 25,000 (USD 3,444) per trip, and 24% exceeding CNY 50,000 (USD 6,890), especially from tier-one cities like Shanghai, Beijing, and Hong Kong. Taiwanese travelers also favored premium experiences.
• Digital-First Behavior: 79% of Greater China travelers researched shopping pre-trip, with 61% influenced by social media platforms like Xiaohongshu, Douyin, and Taiwan’s Instagram. Mobile payments (Alipay, WeChat Pay, LINE Pay) accounted for 44% of transactions.
• Destination Preferences: Macau, Hong Kong, and Taiwan captured 30% of mainland China’s outbound travel, followed by Southeast Asia (14.7%), with Thailand, Vietnam, and Singapore leading. Northeast Asia, particularly Japan and South Korea, accounted for 10.6%, while Europe and North America held 6.7% and 8.7%, respectively. Taiwanese travelers favored Japan (20%) and the U.S. (8%).
• Spontaneous Travel: 76% of Greater China travelers booked trips less than a month in advance, reflecting flexibility among younger and high-net-worth individuals, particularly from Hong Kong and Taiwan.

Japan’s Outbound Tourism Market

Japan’s outbound tourism market saw significant recovery in 2024, with 11.8 million outbound trips, reaching 62% of 2019 levels, and is projected to grow to USD 90.1 billion by 2035 at a CAGR of 26.6%. Key trends include:

• Popular Destinations: South Korea (25.7%), Taiwan (14.2%), Southeast Asia (10.6%), Hawaii (9.7%), and Europe (9.7%) were top choices, with Italy, Spain, Portugal, and France leading European destinations. The U.S. attracted significant visitors for urban and cultural experiences.
• Travel Patterns: Japanese travelers favored longer trips, with nearly a third opting for four-day/three-night trips during peak periods like Golden Week. Solo travel rose among younger demographics, alongside demand for cultural, wellness, and eco-tourism.
• Economic Drivers: Rising disposable incomes fueled demand, with Golden Week 2024 spending reaching JPY 135 billion (USD 940 million), up 8% from 2023. The weak yen made Japan a cost-effective destination for inbound tourists but increased outbound travel costs.
• Challenges: Economic volatility and rising travel costs posed risks, mitigated by digital booking platforms and tailored travel packages.

Korea’s Outbound Tourism Market

South Korea’s outbound tourism market rebounded strongly, with 11.9 million outbound trips in 2024, a 15% increase from 2023, recovering to 65% of pre-pandemic levels. Key trends include:

• Destination Preferences: Japan led with over 3 million Korean visitors, driven by proximity, cultural affinity, and visa-free travel. Southeast Asia (Malaysia, Singapore) and Europe followed, with growing interest in the U.S. for cultural and urban experiences.
• Travel Behavior: Korean travelers prioritized value-centric, visa-friendly destinations, with a focus on short-haul trips and immersive cultural experiences. Sustainable tourism gained traction.
• Economic Factors: Rising incomes and improved flight connectivity supported growth, though economic uncertainty and geopolitical tensions posed risks.
• Digital Influence: Mobile apps and social media heavily influenced destination choices and booking patterns, similar to Greater China.

Greater China Outbound Tourism to Europe and the U.S.

Greater China’s outbound tourism to Europe and the U.S. grew significantly in 2024, driven by affluent travelers seeking cultural and luxury experiences:

• Europe: Greater China travelers, particularly from mainland China, contributed to a gradual recovery, with Italy, the UK, and Spain nearing 2019 levels. Emerging destinations like Turkey, Serbia, and Croatia saw notable growth during the National Day holiday. Hong Kong and Taiwanese travelers also favored France and Germany, supported by visa relaxations and promotional campaigns.
• United States: The U.S. welcomed significant Greater China visitors, with mainland China, Hong Kong, and Taiwan travelers drawn to urban centers like New York and Los Angeles, as well as cultural hubs and theme parks. Anime and pop culture tourism grew among Taiwanese travelers in Los Angeles and San Francisco.
• Growth Drivers: New direct flight routes from Shanghai, Taipei, and Hong Kong, alongside targeted marketing by European and U.S. tourism boards, boosted demand. Visa simplifications, such as Singapore’s visa waiver for Chinese travelers, set a precedent for long-haul destinations.
• Challenges: High travel costs, complex Schengen visa processes, and geopolitical tensions (e.g., U.S.-China relations) hindered growth. Sustainable and personalized offerings remain critical.

Consumer Behavior and Spending Trends

The 2023 McKinsey China Consumer Report highlights double-digit consumption growth among upper-middle and high-income households in Greater China, favoring premium brands. Travelers prioritized quality, with spending focused on accommodation (19%), airfare (17%), and food (16%). Duty-free retail, particularly beauty, skincare, luxury fashion, and fine wine, remained a key activity. Japanese travelers emphasized high-end resorts and exclusive tours, while Korean travelers sought value-driven, culturally rich experiences.

Challenges and Risks

Challenges impacting the market include:

• Economic Uncertainty: Currency depreciation and global economic fluctuations impacted travel sentiment, though Japan’s weak yen boosted inbound tourism.
• Geopolitical Tensions: South China Sea disputes reduced Greater China tourism to the Philippines and Taiwan, affecting Hong Kong and Macau travelers.
• Environmental Concerns: Air pollution in Thailand and environmental degradation in Boracay and Palawan posed risks.
• Infrastructure Limitations: Overcapacity at Vietnam’s Tan Son Nhat Airport and Indonesia’s limited inter-island connectivity hindered seamless travel.

Our Role

With decades of expertise in marketing and retailing to Asian consumers, Aether & Earth Co. is uniquely positioned to support travel industry partners in capitalizing on these trends. By leveraging data-driven insights and fostering strategic collaborations, we help partners connect with affluent and digitally savvy Asian travelers, particularly from Greater China, Japan, and South Korea. Our approach emphasizes:

• Tailored Marketing: Utilizing platforms like Xiaohongshu, Douyin, KakaoTalk, and LINE to engage travelers with authentic, visually driven content.
• Premium Experiences: Aligning with preferences for high-quality, culturally immersive travel offerings.
• Seamless Integration: Supporting digital payment systems and last-minute booking capabilities for spontaneous travelers.

As the Asia Pacific tourism market surges toward a projected 801 million international visitor arrivals by 2027, Aether & Earth Co. LLC remains committed to driving sustainable growth and meaningful connections between travel brands and Asian consumers.