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China’s is wrapping up its first Labor Day holiday without the threat of COVID-induced lockdowns hanging over the nation since 2019. Though spending has been a bit more subdued than revenues witnessed in the final year before the pandemic, the number of trips taken by Chinese travelers throughout the five-day holiday is expected to fully recover to 2019 levels. 

Chinese tourists had spent hundreds of billions of dollars annually on international travel before the pandemic. Outbound air bookings during this year’s holiday were close to half of their pre-pandemic levels, continuing a recovery that is likely to strongly benefit Southeast Asia’s large tourism industry. It will take some more time for China-US air traffic to mount a meaningful recovery, but many US carriers begun resuming service to China in Q1, following suspensions in 2020.

Related ETFs: iShares MSCI China ETF (MCHI), Global X FTSE Southeast Asia ETF (ASEA), Defiance Hotel, Airline, and Cruise ETF (CRUZ)

China’s Labor Day holiday, celebrated from April 29 to May 3 this year, has been the first normal holiday period for many after three years of COVID-19 outbreaks and resulting restrictions that often ended in full lockdown procedures. Bloomberg reports that more than 159 million trips were made by car, rail, airplane and waterways in the first three days of the five-day holiday, up 162% from the same period last year.

The average number of trips across those three days suggests a slightly quicker pace than projected by the Global Times, which reported that Chinese travelers were expected to make a total of over 240 million trips during the holiday period. That total would suggest a full return to 2019 levels for the same period. However, revenue from domestic tourism is forecast to be more sluggish, representing just 83% of 2019 levels, at 120 billion yuan ($17.4 billion), according to official estimates.

Data from travel portal, also reported that outbound air bookings during the holiday recovered to 45% of the levels during the same holidays in pre-pandemic 2019. Some of the hottest destinations included Bangkok in Thailand, Kuala Lumpur in Malaysia, and Singapore. Southeast Asian economies that are…

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