Japanese Tourism Continues ‘Off The Charts’ in 2017
No doubt your senses have come across the infamous tale of booming tourism in Japan, it is something that has been widely reported across media organisations, blogs, governments and more to the point it feels like a broken vinyl.
Well ladies and gentlemen, here we are to join that chorus! No only to demonstrate the build-up of those numbers, but also to think about what they may suggest about the future of Japan’s tourism sector. An obvious catalyst for this compounding rise in visitor interest is the Tokyo Olympics, as they have yet a second crack at hosting this illustrious international sporting event.
In thinking about tourism numbers alone, especially focusing on the last 2-3 years, the jump is considerable. In 2017, it is estimated that 28.7 million tourists came to the country, up by a massive 19 percent from the previous year’s milestone of 24 million international visitors. This sequence also seems to begin with the announcement of Tokyo’s successful bid to host the Olympic Games, back in September 2013, and thus the rush to Japan began to unfold.
Another benefactor from this surge in tourism is a parallel spike in consumption and spending all helping to boost the Japanese economy. Similar to the increase in overall visitors, overall tourist spending was also up in 2017, totalling ¥4.42 trillion or 18 percent up from the previous year.
So how do we know if this is having any material impact on the Japanese economic situation as a whole? Well, it was reported in the third quarter results from July to September 2017 that annual GDP was up 2.5%. Furthermore, with Prime Minister Abe retaining power over the Government after the 2017 election, he has made tourism one of the prime focal points of his growth strategy for his latest term in office.
So with this rise in visitors literally ‘off the charts’, the Japanese Government also predicts this stratospheric trajectory will continue all the way to the 2020 Olympics Games in Tokyo. They even have set themselves a ‘sales target’ of 40 million tourists by the end of the decade.
So what does the future look like for Japanese tourism? I come from an investment background, and a common disclaimer we use in all of our performance charts is simply this ‘past performance is not an indicator of future returns’. However, it is difficult to argue with the indicators which are all pointing north. Only time will tell, but it is expected that this trend upwards will continue, at least in the short-term.