Chinese New Year 2023 is the first since China lifted its longstanding COVID-19 restrictions, meaning that travel and consumption can finally return to somewhat normal levels. At the same time, the possible rebound in travel may increase transmission of COVID-19, which may dissuade some from leaving home. We look at the possible travel and consumption trends over the Chinese New Year period and discuss the impact they may have on the economy and businesses.
For many people in China, the 2023 Chinese New Year will be one to remember. Some will be reuniting with family members for the first time in three years, while others will be leaping at the chance to finally travel abroad again.
With virtually all COVID-19 restrictions in China now lifted, the 2023 Chinese New Year period is expected to see a major increase in travel and consumption activity from previous years. This is a positive development for businesses and will be a clear sign that China’s economy is on the road to recovery.
At the same time, the Chinese New Year holiday is taking place during the winter surge in COVID-19 cases, raising concerns over the risk of transmission to elderly family members. This has led some to forego their newfound freedom in favor of staying safe at home. For those that still choose to travel, there is the possibility of getting sick while away and being unable to return to their workplaces, which could be a cause for concern for employers.
In this article, we look at the travel and consumption trends that are expected over Chinese New Year and discuss the possibility of disruption from the wave of COVID-19 infections.
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Chinese New Year, also known as the Spring Festival or the Lunar New Year, especially in the context of its observance in other East and Southeast Asian countries, is a celebration to mark the new year in the traditional lunar calendar, or nongli (农历). In 2023, Lunar New Year will be on Sunday, January 22.
In China, the New Year period is marked by a seven-day-long national holiday. In 2023, this holiday will take place from Saturday, January 21 to Friday, January 27. China also imposes make-up days for some national holidays. For the Chinese New Year holiday, two extra make-up workdays have been stipulated on Saturday, January 28, and Sunday, January 29.
2023 Chinese New Year Holiday Calendar
Note that although the official new year holiday is only from January 21 to 27, the “new year period” in the context of travel and holidaymaking is generally longer, beginning one to two weeks before the start of the official holiday and lasting around a week after the end. This is because many people will extend the holiday by taking annual leave to get more time off or avoid the peak travel times.
Some industries and companies also provide adjusted holidays for their staff in order to keep operations and production going over the official holiday period.
There are virtually no restrictions on movement or travel in place over the new year period. In November and December 2022, China began to dismantle its long-standing COVID-19 prevention and control measures, which involved lifting the vast majority of travel restrictions and control measures for people infected with COVID-19. Since December, there have therefore been no restrictions on travel or movement, and people have been able to travel freely around the country without the need to show a negative COVID-19 test, a green health or travel code, or otherwise prove that they are not infected with COVID-19.
In addition, on January 8, 2023, China also lifted its quarantine requirements for passengers arriving from overseas, which means people in China can now also travel abroad much more easily than before.
For information on China’s COVID-19 measures and developments, see our COVID-19 tracker.
With the lifting of almost all COVID-19 restrictions, it is expected that 2023 will see a significant uptick in the number of trips made from the last three years. Official estimates state that around 2 billion trips will be made over the 2023 new year period, around 70 percent that of 2019.
We can see from preliminary travel data that there has been a major jump in the number of transport bookings made for the new year period. According to data from Ctrip, a major Chinese online travel agency (OTA), as of January 7, 2022, the number of inquiries and reservations for railway travel during the new year period increased by nearly 20 percent compared with the same period last year.
Meanwhile, Fliggy, the Alibaba-backed OTA, revealed in a report that as of January 11, 2023, the number of travel bookings over the new year period had increased by 60 percent from 2022. Among these, around 80 percent were for cross-provincial travel, indicating the majority of people are traveling home to visit relatives. This is also reflected in Ctrip’s data, which noted that the distance of booked travel by train and plane had increased by 72 percent and 43 percent, respectively, from 2022.
This could mark a reversal from the short-haul travel trend that was seen in 2021 and 2022.
Meanwhile, although travel restrictions have been lifted, some Chinese officials have warned people against traveling home over the new year period to prevent spreading the virus, in particular to elderly family members. However, this is not official advice, and it is up to the discretion of the individual to choose whether to heed it or not.
There will therefore be a portion of people who will voluntarily stay put rather than risk contracting or spreading the virus to relatives. As the statistics discussed above are all preliminary and based on bookings, it is of course possible that people will change their minds and cancel travel plans, in particular, if more news about the risk of spreading the virus to elderly family members comes is released in the run-up to the holiday.
Although Chinese New Year is primarily a family holiday, more and more people are choosing to spend their time off traveling to new places. Since COVID broke out, this has been largely restricted to domestic tourist destinations.
This year, however, pre-holiday data shows that international travel as well as travel to Hong Kong and Macao over the new year holiday is recovering. According to data from Ctrip, outbound travel over the seven-day holiday has grown by 540 percent year-on-year. In addition, as of January 12, 2023, overall travel bookings to countries in Southeast Asia in the run-up to Chinese New Year grew by 1026 percent year-on-year, while airline ticket bookings grew 864 percent from the same period in 2022. The most popular destination for mainland Chinese residents traveling abroad was Thailand.
With restrictions lifted and travel returning to somewhat normal levels, it is also natural that overall consumption will increase over the new year period. As with Christmas in many other parts of the world, the Lunar New Year is a major shopping holiday, with people spending on things such as special purchases for the Chinese New Year (nianhuo 年货), gifts for family (nianli 年礼), groceries and restaurants, and new clothes, as is traditional.
Even people who decide not to travel over the holiday period will be likely to spend more money on local goods and services this year compared to previous years, as retail, catering, and entertainment businesses will be allowed to operate as normal.
In addition to an increase in consumption, we may also see a change in how and where people spend their money. As more people chose or were forced to stay at home during the new year period over the last three years, consumption moved more online and was concentrated on items such as domestic goods and food that could be provided through delivery.
With people now free to go where they please and brick-and-mortar businesses staying open, we expect to see more spending on in-person services, such as catering, hospitality, and entertainment, as well as retail.
New year consumption slumped during the COVID-19 pandemic due to restrictions on travel and movement, with brick-and-mortar businesses being particularly hard-hit. This year’s Chinese New Year is hoped to give a much-needed boost to the economy, contribute to overall demand for goods and services, and help restore consumer confidence.
As there are no longer any travel restrictions on people who have caught COVID-19, the likelihood of disruption to your employees during their holidays is relatively small. Today, if an employee contracts COVID-19 while they are away on holiday, they will still be able to travel back to their place of work, as long as they are well enough to travel. Lockdowns are also no longer imposed, meaning that there is no risk of employees getting stuck in their hometown or hotel, as has previously happened.
However, companies may still want to prepare for the possibility of employees getting ill and being too unwell to travel back to their place of work. With a huge volume of trips occurring over a relatively short period of time, the risk of transmission will be high, and it is likely that some employees will fall ill.
For this reason, if they have not already done so, companies are advised to make temporary accommodations for employees who get sick while away, such as remote work arrangements, sick leave, or make-up work days. For more information on how “living with COVID” has changed labor relations, see our article here.
For office-based workers, companies can ask staff to bring laptops and other required equipment or materials with them when they travel, or ask them to ensure they have access to a computer or necessary equipment in the place they are traveling to, where such a request is reasonable.
This will obviously not be possible for employees who are required to be on-site to do their work. For companies with on-site employees, it is advisable to provide sick leave arrangements in accordance with regulations to maintain the labor relationship. Companies can also implement flexible work arrangements for their staff, for instance, by maintaining a pool of temporary workers that can fill in the vacancies or implementing work-share arrangements with employees of other companies to make up for staff shortages. Some companies are also providing additional overtime pay for employees to incentivize employees to stay and work over the new year period.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done so since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at firstname.lastname@example.org.
Dezan Shira & Associates has offices in Vietnam, Indonesia, Singapore, United States, Germany, Italy, India, and Russia, in addition to our trade research facilities along the Belt & Road Initiative. We also have partner firms assisting foreign investors in The Philippines, Malaysia, Thailand, Bangladesh.
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