Goldman Sachs does and seeks to do business with companies covered in its research reports. As a result, investors should be aware
that the rm may have a conict of interest that could affect the objectivity of this report. Investors should consider this report as only a
single factor in making their investment decision. For Reg AC certication and other important disclosures, see the Disclosure Appendix,
or go to gs/research/hedge.html. Analysts employed by non-US afliates are not registered/qualied as research analysts with
FINRA in the U.S.The Goldman Sachs Group, Inc.
軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘
The Chinese Tourist Boom
W
h
e
r
e
N
o
w
,
W
h
e
r
e
N
e
x
t
November 20, 2015
China’s outbound tourism is set to bloom over the軘
next 10 years and leave its mark on a wider range軘
of destinations. Fueled by experience-hungry軘
millennials and a growing middle class, the number軘
of Chinese passport holders is forecast to swell by軘
100 million over the decade – equal to almost 1.5x軘
all US outbound tourists today. While Hong Kong軘
and Macau will remain important destinations, the軘
surge will lead to dramatic increases in visitors to軘
destination軘 across Asia, Europe and beyond.
軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘
軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘軘
November 20, 2015Asia Pacific: Retail
Goldman Sachs Global Investment Research 2
Table of contents
Chinese tourism in eight charts 4
Overview: Six key questions 6
Chinese tourism by numbers 8
Q1: How many could travel 11
Q2: Who are they 14
Q3: Why do they travel 21
Q4: Where do they go 25
Q5: Is capacity an issue 41
Q6: What could slow the tide 52
Appendix 64
Disclosure Appendix 66
This is an abridged version of “The Chinese Tourist Boom: Where Now, Where Next” originally published November 20, 2015.
Analyst team contributors
AnalystTelephoneEmailAnalystTelephoneEmail
Japan RetailHong Kong Retail
Sho Kawano+81 (3) 6437 9905sho.kawano@gsJoshua Lu+852 2978 1024joshua.lu@gs
Jingyuan Liu+81 (3) 6437 9858jingyuan.liu@gsRicky Tsang+852 2978 6631ricky.tsang@gs
Alan Lee+852 2978 0953alan.lee@gs
Japan Hotel/REITHong Kong Conglomarates
Sachiko Okada+81 (3) 6437 9937sachiko.okada@gsSimon Cheung+852 2978 6102simon.cheung@gs
Akira Watanabe+81 (3) 6437 9819akira.watanabe@gsAlex Ye+852 2978 6666alex.ye@gs
Japan TransportationHong Kong Transportation
Kenya Moriuchi+852 2978 1255kenya.moriuchi@gsRonald Keung+852-2978-0856 ronald.keung@gs
Taiki Okada+81 (3) 6437 9917taiki.okada@gs
Korea RetailEU Retail
Christine Cho+82 (2) 3788 1773christine.cho@gsWilliam Hutchings+44 (20) 7051 3017william.hutchings@gs
Jean Lee+82 (2) 3788 1729jean.x.lee@gsIsabel Zhang Zhang+44 (20) 7552 4644isabel.zhangzhang@gs
Taiwan RetailUS Retail
Michelle Cheng+866 (2) 2730 4181michelle.cheng@gsMatt Fassler+1 (212) 902 6740matt.fassler@gs
Goldie Chang+65 6654 5154goldie.chang@gsLindsay Drucker Mann+1 (212) 357 4993lindsay.druckermann@gs
ASEAN RetailUS Leisure
June Zhu+65 6889 2466june.zhu@gsSteven Kent+1 (212) 902 6752steven.kent@gs
Afua Ahwoi+1 (212) 902 1760afua.ahwoi@gs
Hong Kong Internet/Media
David Jin+852-2978-1466 david.jin@gs
November 20, 2015Asia Pacific: Retail
Goldman Sachs Global Investment Research 3
The Chinese Tourism Boom: By the Numbers
4%
The passport-owning population in China (vs. 35%
in the US). We expect this figure to reach 12%
within 10 years. (Page 16)
PASSPORT POTENTIAL
28%
MIDDLE-CLASS MOBILITY
The percentage of outbound Chinesetourists from
the “urban middle” class, compared to just 3%
from the “urban mass.” (Page 17)
GRADUATE AND GO
The number oftravel-ready millennials who will
graduate from Chinese universities in the next 10
years. (Page 18)74 mn220 mn
THE 10-YEAR TRAVEL OUTLOOK
The number of Chinese residents who will travel
overseas in 2025, up from 120 mn this year.
(Page 13)
70 mn
HEADED TO HONG KONG AND MACAU…FOR NOW
The number of Chinese travelers who will visit
Hong Kong and Macau in 2015—two destinations
that don’t require a passport. (Page 27)
NEXT STOP(S): JAPAN AND BEYOND
The number of Chinese residents who will visit
Japan in 2025, up from 5mn in 2015. We also
expect Korea, Australia and Europe to become
tourist hot spots. (Page 26)
16 mn
The average amount that Chinese residents spend
on “having more fun.” This is less than 10% of the
per capita amount in the US, Japan and Korea, but
poised to grow as China spends more on leisure.
(Page 24)
“HAVING FUN” BUDGET
$230/yr
The average cost of a package tour to Japan,
including money spent on shopping ($1,000). (Page
21)$2,000
VACATION COSTS
The amount Chinese tourists will spend on travel
overseas in 2025, an increase of $250 bn from
today’s figures. (Page 35)
THE ACCOMPANYING RETAIL BOOM
$450 bn
The discount Chinese tourists can expect when
shopping in Japan, Korea and Hong Kong, adding
to these locations’ appeal. (Page 39)20-30%
BARGAIN HUNTING
3 hours
The flight time from Shanghai to Tokyo. Chinese
tourists can fly to most Asian countries in four
hours or less. (Page 29)
UP IN THE AIR
45
VISA RESTRICTIONS LIMIT TRAVEL
The number of countries that offer Chinese tourists
visas upon arrival. In contrast, 172 countries offer
visas on arrival for Japanese and Korean tourists.
(Page 60)
November 20, 2015Asia Pacific: Retail
Goldman Sachs Global Investment Research 4
Chinese tourism in eight charts
Exhibit 1: We estimate only 4% of the Chinese population owns a passport…
Passport ownership by country
Exhibit 2: …as such, we expect Chinese tourist numbers to keep growing…
Chinese tourist growth outlook by destination (GSe)
Source: CEIC, Goldman Sachs Global Investment Research.
Source: Goldman Sachs Global Investment Research.
Exhibit 3: …potentially to 130 mn vs. 50 mn in 2015 (ex. Hong Kong/Macau)
Chinese tourist volume to Hong Kong/Macau, and other regions
Exhibit 4: “Fun” related spending is under-indexed in China…
Comparison of per-capita spending on “having fun” (FY2013, US$)
Source: CEIC, Goldman Sachs Global Investment Research
Source: Euromonitor
55
150
109
32
4%
12%
35%
25%
0%
5%
10%
15%
20%
25%
30%
35%
40%20
40
60
80
100
120
140
160
China (2014E)China (2025E)US (2012)Japan (2014)
Total passport holders (mn)as % of population (RHS)
Assuming the
run rate
continues at
10mn
passports p.a.
(mn)2015E2025E
HK/Macau68.0→86.4
1.3X
Korea5.9→14.1
2.4X
Taiwan4.1→9.2
2.2X
Japan5.0→16.0
3.2X
ASEAN12.0→35.0
2.9X
2.4X
Australia1.0→2.0
2.0X
US2.2→5.0
2.3X
Europe10.0→22.5
2.3X
Other11.8→29.8
2.5X
Total120.0→220.0
1.8X
456779101113171921
26313940
50
130
5561013
20212328
282936
4452
5969
70
90
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%50
100
150
200
250
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20142015E...2025E
Aggregate outbound tourists over time (mn)
Passport Destinations (lhs)HK &