Home to half of the world’s top 10 trending tourism destinations, Asia Pacific is making a comeback: Mastercard Economics Institute on travel in 2024

• Japan tops the trending list, welcoming a record-breaking three million plus international arrivals in March
• Outbound travel from the Chinese Mainland continues to recover, now at 80 percent of 2019 levels
• Tourism shopping on apparel and dining in Hong Kong rose over the past 12 months
• Overseas visitors are staying longer in Hong Kong for an average of 6.4 days in 2024, an increase of 1.1 days compared to 2019

The global travel sector is breaking boundaries in 2024 as consumer spending on tourism remains robust and passenger traffic soars, according to the latest report from the Mastercard Economics Institute (MEI). Released today, the MEI’s fifth annual report, "Travel Trends 2024: Breaking Boundaries" provides comprehensive insights into the evolving landscape of the travel industry across 74 markets, including 13¹ in the Asia Pacific region (APAC).

Despite fluctuating exchange rates and varying levels of affordability, travel is booming, with nine out of the last 10 record-setting spending days in the global cruise and airline industries occurring this year². Looking ahead, the MEI anticipates this momentum will continue as consumers around the world prioritize meaningful experiences and allocate more of their budgets to travel. More than ever, consumers are prioritizing meaningful experiences over material goods, fueled by a strong labor market and a strong desire to travel.

Drawing on a unique analysis of aggregated and anonymized Mastercard transaction data, including Mastercard SpendingPulse™ and third-party data sources, the report takes a deep dive into key tourism trends for 2024 and beyond. Here in the Asia Pacific region, a few themes stand out, including:

APAC destinations are trending in a big way, comprising half of the top 10 hot spots that have demonstrated the greatest momentum among travelers. This is measured and ranked by the change in share of tourism transactions over the past 12 months ending March 2024.

• Japan emerged as the #1 trending destination worldwide growing 0.9 percent, as it welcomed 3,081,600 visitors from abroad in March 2024 – the highest level ever – even before the peak travel season begins. Driven by a weak yen (the lowest since 1990), Japan’s favorable exchange rate is expected to help it remain the clear tourism frontrunner throughout 2024, benefitting Japanese businesses catering to tourists and the local economy overall.
• APAC passenger traffic is rebounding, particularly for shorter, intra-regional trips. For example, this summer's top destinations for travelers from Hong Kong include Bangkok, Okinawa, Fukuoka, Nagoya, Tokyo, Seoul, Manila and Kaohsiung.

“Consumers in the Asia Pacific region have an intense desire and willingness to travel and are becoming increasingly savvy to ensure they get the best value and unforgettable experiences from their trips,” said David Mann, chief economist, Asia Pacific, Mastercard. “For tourism authorities, retailers, the hospitality and F&B sectors, the bottom line is that costs matter. In today’s economy, foreign exchange rates and spending power have become vital components in driving a traveler’s assessment of value when they are making their plans. This suggests that businesses targeting tourism dollars need to review their current strategies, and shift them if necessary, to maintain their appeal to travelers.”

Summer holiday hot spots (June-August 2024³)

While Japan was the top trending destination during the last 12 months⁴, looking ahead, Munich ranks as the #1 summer destination (in terms of share gain in flight bookings) due to its hosting of the UEFA EURO 2024 football championship in June. Tokyo comes in a close second while Bali (#6) and Bangkok (#7) are also among the top 10 cities where demand is gaining momentum in the next three months.

Chinese Mainland Domestic Tourism Rebounds While Outbound Travel Continues to Recover

The Chinese Mainland’s travel dynamic has shifted, as more Chinese tourists prioritize domestic trips over international ones.

• The Chinese Mainland’s domestic tourism story is a positive one, as air passenger traffic has fully normalized, with numbers ~15 percent above 2019 levels according to data from the Civil Aviation Administration of China, benefiting local businesses.
• Meanwhile, international tourism traffic leaving the Chinese Mainland continues to recover and is now at 80.3 percent of 2019 levels.
• Additional upside growth is expected in 2024, supported by visa exemptions in APAC and beyond, as well as an increase in international flight capacity, benefiting destinations such as Singapore, Malaysia and Thailand.

Leisure for Longer

• In APAC (excluding ANZ) in 2024, tourists are extending their trips by an average of 2 days to a total duration of 7.4 days, motivated by the affordability of destinations, warm weather and favorable exchange rates. This compares to the 2019 average of 6.1 days per trip.
• In Hong Kong, overseas visitors are staying for an average of 6.4 days, an increase of 1.1 days compared to 2019.
• The APAC destinations with the longest increase in trip duration between 2019-2024 are India (+2 days), Vietnam (+2 days), Indonesia (+1.9 days) and Japan (+1.4 days), largely due to their lower growth in hotel prices during this period compared to other markets.
• Longer stays generally translate to more spend per trip too, which benefits local economies.

Thrill Seekers Want Experiences and Nightlife

Consumers globally continue to prioritize experiences over material goods. This is playing out in the travel sector as spending on experiences and nightlife totals 12 percent of tourism sales – the highest point in at least five years. Meanwhile, retail shopping is recovering at a slower pace.

• Australian tourists are the highest spenders globally on experiences and nightlife.

• In 2024, Aussies are spending one of every five dollars (19 percent) on these activities – significantly higher than the global average (12 percent).
• Tourists from the Chinese Mainland are also increasingly seeking out experiences, spending 10 percent on this category in 2024, up from seven percent in 2023.

Casual Trumps Luxury for Fashion and Food

Tourists today prefer laid-back vibes, except in spots where luxury retail and fine dining provide exceptional value for money.

• Notably, luxury fashion sales soared YoY in the year ending March 2024 in Hong Kong (208 percent), despite casual fashion still leading the pack at 284 percent.
• Hong Kong’s surge is partly attributed to its late reopening in 2023.
• In Hong Kong, tourism shopping on casual dining and fine dining is respectively 248 percent and 237 percent higher in the year ending March 2024 than at the same time last year.

“Amidst the evolving tourism landscape and continuing surge in travel throughout 2024, the Mastercard Economics Institute aids businesses and policymakers in translating macroeconomic forces and data insights into actionable strategies at the country, category and company levels, in addition to counseling on possible scenarios and the implications they have on demand,” added Mann.

Explore the full Travel 2024: Breaking Boundaries report here. Additional reports and insights from the Mastercard Economics Institute can be found here.

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¹ Australia, Chinese Mainland, Hong Kong, India, Indonesia, Japan, Malaysia, New Zealand, Philippines, Singapore, South Korea, Taiwan and Thailand

² MEI analysis of aggregated, anonymized switched consumer volumes (nominal USD unadjusted for FX) through March 2024

³ MEI analysis of aggregated & anonymized Mastercard leisure flight booking data provided by third party partners.

⁴ MEI analysis of aggregated & anonymized Mastercard leisure travel related switched transactions.