Analysis by ForwardKeys, the company that helps forecast future travel by analysing around 17 million flight booking transactions a day, suggests that hosting the Winter Games will only provide a short-lived boost for inbound tourism.
When South Korea allowed US-made THAAD missiles to be sited on its territory in response to sabre rattling by the North Korean leader Kim Jong-un, the Chinese government was so displeased that it introduced measures to discourage its citizens from visiting South Korea and, in just a few months, South Korea’s largest and most valuable inbound tourism market collapsed; in the year to 1st April 2017, visitor arrivals fell by 67 per cent.
In late November 2017, China relaxed its ban on group tours to South Korea and, in early January, North and South Korea agreed to hold talks, which resulted in the North Koreans planning to attend the Winter Olympics in Pyeongchang. There was speculation that the Games could mark a tourism revival but that is looking unlikely. Inbound flight bookings for February are currently 15.4 per cent ahead of where they were at this time last year, but bookings for March are currently 24.9 per cent behind.
In 2017, Chinese New Year fell on 28th January but this year it falls on 16th February. Therefore, one would expect there to be a relatively steep decline in Chinese travel to Korea prior to the Games and a strong surge during the Olympic period; however Chinese bookings for February are just 5.6 per cent ahead of where they were at this time last year.
The Winter Olympics has helped boost inbound tourism from certain long-haul origin markets. If one excludes China, overall bookings for the Olympic period are currently 20.1 per cent ahead. Notably, flight bookings from Hong Kong are 24.8 per cent ahead, from the USA 23.8 per cent ahead, from Germany 30.7 per cent ahead, from Canada 41.6 per cent ahead and from Malaysia 19.1 per cent ahead. The most spectacular growth is from Vietnam, 555 per cent ahead, which is the result of the combination of improved air connectivity, a visa waiver for the Olympic period and Tet holidays (Vietnamese New Year).
Olivier Jager, CEO, ForwardKeys, said: “In tourism terms, the winter Olympics will provide a glow against the gloom. The reality is that South Korea is very heavily dependent on China for its tourism exports and, right now, the strongly growing outbound Chinese market is headed elsewhere in Asia. The rebuilding of diplomatic relationships between Seoul and Beijing is the key to its recovery.”