Report Released丨"2018 Tourism Economic Operation Review" Series Report (Ten): Analysis of Tourism Economic Operation in 2018 and Development Forecast in 2019

On January 30, the China Tourism Academy (Data Center of the Ministry of Culture and Tourism) released the "2018 Tourism Economic Operation Inventory Series Report: 2018 Tourism Economic Operation Analysis and 2019 Development Forecast." The report shows that in 2018, under the strong leadership of the Party Central Committee and the State Council, the national tourism system worked hard, and the tourism economy continued to maintain a faster growth rate than GDP growth, basically completing various work goals set at the beginning of the year. The domestic tourism market continued to maintain rapid growth throughout the year, the inbound and outbound markets developed steadily, the integration of culture and tourism made new progress, all-region tourism has become a consensus on social development and an important action guide, the quality of tourism services has entered a new track of quality tourism, and the trend of regional tourism balance has further emerged. , the role of tourism in diplomacy and Hong Kong, Macao and Taiwan affairs has become more prominent.

1. The tourism economy maintained steady growth in 2018

According to the working principle of "integrate where appropriate, integrate as much as possible, promote tourism with culture, and promote culture with tourism", the integration of culture and tourism has achieved new achievements. It is estimated that the number of domestic tourists in 2018 will reach 5.54 billion, an increase of 10.76% over the previous year, and the number of inbound and outbound tourists will reach 290 million, an increase of 7.4% over the previous year. The other indicators have also achieved the goals set at the beginning of the year.

1. The integration of culture and tourism has started smoothly. 2018 is the first year of the integration of culture and tourism, and the development environment of the tourism industry continues to be optimized. At the beginning of the year, the government work report regarded the growth of outbound tourism as a great achievement in improving people's livelihood, released a positive signal to encourage consumption, and deployed key tasks such as promoting the toilet revolution, creating a full-region tourism demonstration zone, and reducing the ticket prices of key state-owned scenic spots. The institutional reform of national and local cultural and tourism departments has been smoothly promoted, and a pattern of multiple departments jointly promoting the development of the tourism industry has been formed. The number of national tourists maintained double-digit growth throughout the year, holiday tourism consumption has become a new folk custom, cultural participation in the tourism process has increased significantly, and red tourism has achieved rapid development.

2. Industrial innovation is more active. A better life is increasingly becoming a realistic driving force for the development of high-quality tourism and industrial innovation. People's needs for a better life are becoming increasingly extensive, and the quality, objects, methods and behaviors of consumption are undergoing structural upgrades. The World Bank said that by 2020, there will be more than 200 million richer families in my country, and these people will spend about 19% of their annual salary on traveling abroad. Represented by the middle class, the pursuit of high-quality products, quality leisure and customized tourism is becoming a hot topic. The demand for quality tourism consumption drives corporate product research and development and business innovation. Pure play without shopping, high-end hotels, exclusive tour guides, exquisite small groups, and customized tours have become the keywords for domestic travel in 2018. The ability of urban residents to travel has steadily improved, the frequency and expenditure of residents' travel have continued to concentrate in cities, and urban leisure tourism has risen rapidly.

3. The integration of culture and tourism boosts industrial investment. The stock of tourism employment and fixed asset investment continue to grow, and investment and mergers and acquisitions related to the integration of culture and tourism continue to emerge. The Huangshi Tourism Resort, with a total investment of more than 10 billion yuan, was established in Bazhong, Sichuan, and OCT acquired 80% of the equity of Jianmen Tourism for 480 million yuan. Internet companies represented by Meituan Dianping, while serving the local residents' food, clothing, housing, transportation, leisure and entertainment, have begun to strategically enter the tourism industry. In the process of integrated development of "culture +" and "tourism +", Shanghai Chuangtu, Jingcai Travel Map and other companies have widely used commercial technologies such as big data, cloud computing, and artificial intelligence to transform more and more urban and rural residents' leisure resources into popular tourism products.

4. The role of scenic spots in attracting tourists continues to increase. Against the backdrop of global tourism and ticket price cuts, scenic spots attract tourists and increase secondary consumption, which has gradually become the basic path for the development of destinations. The Huangshan Tourism Semi-Annual Report shows that in the first half of 2018, a total of 1.4814 million tourists were received in the mountain, a year-on-year decrease of 9.94%. During the same period, the number of tourists received by Huangshan City increased by 12.13%. Zhangjiajie, Lijiang, Guilin and other places are in similar situations, indicating that the main battlefield of tourism market competition has gradually transformed into a dual game of scenic spot stocks and destination increments, and scenic spots are increasingly becoming the flow entrance for tourist destinations and other formats. The construction of a small-scale destination system centered on scenic spots is shifting to the optimization of scenic spot functions and the construction of a large-scale tourism destination system centered on cities.

5. The quality of tourism services has been steadily improving. People's yearning for a better life has led to higher expectations for the quality of tourism services. Tourists are more willing to deeply experience urban public leisure spaces and daily life scenes, and seek a sense of daily gain from them. According to the tourism service quality survey data of the China Tourism Academy (Data Center of the Ministry of Culture and Tourism), the comprehensive evaluation index of tourists on tourism service quality in 2018 was 77.91, an increase of 2.50% year-on-year. Among them, the quality of domestic tourism and outbound tourism services maintained a steady upward trend, increasing by 4.19% and 2.33% year-on-year respectively. Although the quality of inbound tourism services decreased by 9.09% year-on-year, it still ranked first among the three major markets.

6. Tourism is more pragmatic. "Home Diplomacy" and "Tourism Year" have become new highlights of international tourism exchanges and cooperation. "Tourism provides a platform for culture to perform" has helped the Belt and Road Initiative, the Shanghai Cooperation Organization, the China-Africa Cooperation Forum and the construction of a community with a shared future for mankind. Inbound tourists are more "feeling" the achievements of socialism with Chinese characteristics.

7. Urbanization plays a more prominent role in passenger flow. In 2018, the per capita disposable income of urban residents increased by 5.6% in real terms, and the per capita disposable income of rural residents increased by 6.6% in real terms. The income growth rate of urban residents was 1 percentage point lower than that of rural residents. However, with the continuous deepening of urbanization, as well as the higher ability and willingness of urban residents to travel and more leisure time, the frequency and expenditure of Chinese residents' travel have continued to gather in cities. In 2017, the proportion of urban residents traveling in my country was 73.5%, and the proportion of tourism expenditure was 82.5%. In 2018, the two proportions increased to 74.4% and 83.1% respectively.

2. The outlook for tourism economic development in 2019 is relatively optimistic

1. The macro-economy and residents’ income are likely to maintain medium-to-high growth

High-speed macroeconomic growth is expected. In July 2018, the UBS Economic Report predicted my country's economic growth in 2019 at 6.2%. In the same month, the International Monetary Fund (IMF) predicted the economic (GDP) growth rate of countries around the world, including China, in 2018 and 2019. It believed that China’s economic growth rate would be 6.6% in 2018 and 6.4% in 2019. %. The IMF stated that although China's GDP growth has slowed down, its economic development is still very strong, and the slowdown is just a normal and appropriate transformation process of the economy.

Consumption vitality will be further accumulated and released. In 2019, positive policies such as a larger-scale and more intensive comprehensive tax cut and a moderate expansion of the deficit ratio are expected to be implemented. The new round of individual income tax reform will raise the starting point, expand the three-tier tax rate, increase special additional deductions for six expenditures such as children's education, continuing education, major illness treatment, mortgage interest and rent, and support for the elderly, and boost residents' income. The "Opinions of the CPC Central Committee and the State Council on Improving the System and Mechanism for Promoting Consumption and Further Stimulating the Consumption Potential of Residents" and the "Implementation Plan for Improving the System and Mechanism for Promoting Consumption (2018-2020)" were released, which will promote the optimization of the consumption policy system, standard system and credit system, and help stimulate residents' consumption potential. The consumer confidence index is at a higher level in the past three decades, and the willingness to consume is at a higher range since the second quarter of 2009. Residents have strong confidence and willingness to consume.

Tourism is expected to receive strong support. A series of policies to stabilize investment have been introduced. The Central Political Bureau meeting listed stabilizing investment as one of the "six stability". Relevant departments have accelerated project approval, increased project reserves, and promoted the construction of a large number of projects. The policy effect will be gradually released in 2019. Making up for shortcomings has become a key task of supply-side structural reform, especially in areas such as infrastructure. The efforts to make up for shortcomings will be intensified. The State Council issued the "Guiding Opinions on Maintaining the Efforts to Make Up for Shortcomings in the Infrastructure Field", and various localities have successively issued plans to make up for shortcomings. It is expected that infrastructure investment will gradually pick up. General Secretary Xi Jinping presided over a symposium on private enterprises and proposed six measures to support the development of private enterprises. It is expected that private investment will grow steadily or even accelerate further.

The integration of culture and tourism breeds new momentum for tourism development. At the China Tourism Group Development Forum held on December 10, 2018, Minister Luo Shugang pointed out that since the establishment of the Ministry of Culture and Tourism, in accordance with the requirements and deployment of the central government, the Ministry of Culture and Tourism has coordinated the promotion of the integrated development of cultural undertakings, cultural industries and tourism, and clarified the working idea of "integrating where it is appropriate, integrating as much as possible, promoting tourism with culture, and highlighting culture with tourism". In the field of cultural tourism and foreign affairs and Hong Kong, Macao and Taiwan, the theme of integrated development has been continuously highlighted. In expanding the supply of high-quality tourism products, advocating civilized tourism and safe tourism, and strengthening the management of tourism market order, it is also closely centered on the theme of integrated development, steadily promoting the standardized construction of the tourism system and the innovative development of the tourism industry. The enthusiasm for the integrated development of cultural construction and tourism in various places has reached an unprecedented high, and the path of the integrated development of culture and tourism has gradually become clear. In 2019, the first year when the economic effects of the integration of culture and tourism began to be released, the curtain was opened for the development of tourism empowered by culture.

2. The external environment is complex, and the new and old driving forces of tourism economic development are in a tug-of-war

The downward risks of the international and domestic economies are increasing. The momentum of world economic growth weakened in 2019. The United States adopted a policy combination of "three arrows" of protectionism, unilateralism and building new economic and trade rules, which had a negative impact on the international and domestic economies. Domestically, my country's economy is in a critical period of growth and reform. The new and old driving forces of economic growth are in the game stage, the new driving forces are in the cultivation and rising period, and the old driving forces still dominate economic growth. Domestic tourism investment growth is weak, corporate debt risks occur from time to time, residents' consumption growth slows down, and the export outlook is not optimistic. The downward pressure on growth is prominent, which is bound to be transmitted to the tourism economy to a certain extent.

High household debt and leverage ratios squeeze out tourism consumption. By September 2018, the proportion of household loans to deposits in my country reached 65.8%, up 5 percentage points year-on-year. The debt burden of residents squeezes out social consumption. For example, from 2014 to 2017, the housing loans of residents increased by 17.78%, 23.58%, 37.4% and 21.67% year-on-year respectively. During the same period, the growth rate of my country's total retail sales of consumer goods showed a continuous downward trend, increasing by 12%, 10.7%, 10.4% and 10.2% year-on-year from 2014 to 2017 respectively, and the annual growth rate in 2018 further dropped to 9.0%. In recent years, the growth rate of residents' travel expenses has been lower than the growth rate of the number of tourists. For example, the difference between the two growth rates was 3.16 in 2017 and only 1.54 in 2018.

The wealth effect and income effect suppress tourism consumption expectations. In 2018, the Shanghai Composite Index, Shenzhen Stock Exchange Component Index, Small and Medium-sized Enterprises Index and ChiNext Index respectively experienced sharp cumulative declines, ranking at the bottom among major global indexes. Chinese household housing assets account for 77.7% of total household assets. Not only do they absorb household liquidity and squeeze household tourism consumption, but house prices in most cities underperform the CPI or even fall, resulting in a decline in the actual balance of wealth felt by residents. further curb tourism consumption. It is expected that this trend of slow growth or even continued decline in the actual balance of wealth will be difficult to reverse in 2019, which will inevitably affect residents' enthusiasm for tourism consumption.

New tourism consumption hotspots need to be cultivated. The income of urban and rural residents in my country is gradually converging. In contrast, the number of trips, travel rate and per capita expenditure of rural residents in my country are not only much lower than those of urban residents, but the gap is becoming increasingly obvious. In the era of quality tourism, there is a structural shortage in the supply of leisure and vacation products, and the development of special markets such as cruise ships, yachts, traditional Chinese medicine and health care, sports tourism, and low-altitude tourism is insufficient and unbalanced. Technology drivers such as the Internet have been fully unleashed, and technologies such as AI and VR are still in the exploratory stage. There are no phenomenal companies in cultural and creative industries, innovation is not stimulated enough, and the cultivation of tourism consumption hotspots is showing signs of slowing down.

3. Tourism economy enters a new era of cultural and tourism integration

The tourism economy will enter a new era of cultural and tourism integration and a new channel for prosperity and development. Domestic tourism will continue to grow, outbound tourism will grow steadily, inbound tourism will develop steadily, industrial operations will maintain a prosperous level, tourism investment will remain high, and tourism employment will increase steadily. The development of China's tourism industry in 2019 will be highlighted as follows: there is a willingness to consume, but consumption decisions are more cautious; there is a willingness to innovate, but operating costs are higher; there are promotion policies, but it is more difficult to make the market "feel"; there is a general direction of integration, However, the path and subjects need to be further clarified; there is a cooperation mechanism, but uncertainty has increased significantly.

Taking into account the development environment at home and abroad and the development trend of the tourism industry, the overall tourism economy in 2019 is optimistic. It is estimated that in 2019, the number of domestic tourists will reach 6.06 billion, and the domestic tourism revenue will reach 5.6 trillion yuan, an increase of 9.5% and 10% respectively over the previous year. The number of inbound tourists will reach 143 million, and the international tourism revenue will reach 129.6 billion US dollars, an increase of 1% and 2% respectively over the previous year. The number of residents traveling abroad is about 166 million, an increase of 11% over the previous year. The total tourism revenue for the whole year will reach 6.52 trillion yuan, an increase of 9.3% year-on-year.

III. Suggestions on the integrated development of culture and tourism in 2019

In 2019, the integrated development of culture and tourism needs to promote the development of high-quality tourism through supply-side reform and continuously enhance tourists' sense of gain. We should expand the space for tourism economic development through culture and improve the efficiency of cultural services through tourism. We should continue to strengthen the cultivation of cultural and tourism market entities and optimize the business environment. At the same time, we should focus on promoting basic theoretical research on the integrated development of culture and tourism and strengthen data support for industrial development.

Original manuscript: Dai Bin, Ma Yiliang, Tang Xiaoyun Edited by: Ma Yiliang