Chinese arrivals see 20% decrease in August

The Marianas Visitors Authority reports that arrivals from China are 20% off this year from August 2018’s arrival numbers. A total of 17,255 Chinese visitors arrived on Saipan in August, down from last July’s 18,356 visitors.

The Chinese market is currently seeing a drop in arrivals as the ongoing tensions in Hong Kong plays a big role in the decrease of arrivals. Hong Kong Airlines and Hong Kong Express have been reducing and cancelling flights due to the intensity of the tensions, and this has been strongly influencing local tourism and the number of visitors to the Marianas in recent months.

In addition, the rising exchange rates, the highest in 11 years, is also affecting potential tourists’ decision to visit an American destination. Rising exchange rates of the renminbi versus the U.S. dollar are becoming a burden to Chinese tourists.

Although Chinese nationals accounted for fewer than 8% of overseas visitors to the U.S. in 2018, according to the National Travel and Tourism Office, they contributed more to the U.S. economy than those from any other country.

Numerous MVA board members expressed this concern as the Chinese market is considered the CNMI’s No. 1 source market for tourists. The CNMI’s other major source markets are South Korea and Japan, which are also experiencing lower arrival numbers.

The Korean market has seen a 5% decrease compared to August 2018, with 26,127 visitors compared to last year’s 27,350. Korea is facing economic struggles due to a trade war between Korea and Japan, declining exports, and to a lesser extent, the trade war between the U.S. and China.

As a result of a rising exchange rate between the Korean won and U.S. dollar, Korean travelers are less likely to travel to the U.S. destinations than a year ago. South Korean consumer sentiment dipped to the worst level in 31 months in August on growing concerns over the export reliant economy amid worsening diplomatic and trade disputes between Korea and Japan, plus the protracted trade war between the U.S. and China. The average USD/won exchange rate in August was 1,209.00 won, a slight increase from the previous rate of 1,174.40 won in July.

Another impact was from Asiana Airlines downsizing its aircraft to the Marianas, but T’Way Air will operate additional flights to Saipan beginning Oct. 27, which is expected to boost the number of visitors from Korea.

Japan posted a 69% decrease in arrivals compared to August 2018, with the 1,540 visitors arriving compared to last year’s 4,950 visitors. The main factor behind this decrease is due to fewer charter flights this year; last August 2018 saw 28 charter flights to the Marianas offered by Jin Air and Asiana Airlines. This year, Skymark Airlines Inc. operated only six charter flights during the peak travel holiday.

MVA’s current goal is to secure daily flights from Japan. Skymark will have three more charter flights to Saipan this month, with an eye toward having regular direct flights to the CNMI later this year.