SINGAPORE – Chinese tourists spent almost SGD$1.52 billion (US$1.20 billion) in Singapore in the first half of 2013, according to figures released by the Singapore Tourism Board (STB). The tourism receipts, which excluded spending on sightseeing and entertainment, would have been even higher if these were factored in. Compared to the same period in 2012, tourism receipts from China grew by 25 percent — the largest increase of any country.
More of these dollars were spent on shopping than any other component, with shopping accounting for 49 percent of tourism receipts from China. In contrast, the other countries making up Singapore’s top 10 tourist markets only spent between 10 to 33 percent of their total spending on shopping, opting instead to shell out greater proportions on accommodation, food and beverage, and other components.
For the first time, Chinese tourists’ spending surpassed that of Indonesian tourists, who had held the top spot since 2007. In the first half of 2013, Indonesian tourist spending amounted to SGD$1.47 billion (US$1.16 billion), 3 percent less than the Chinese. China’s rise to become the top spender in Singapore has been a swift one — only four years ago, tourism receipts from Indonesia exceeded those from China by over US$1 billion.
Indonesia still sends more tourists to Singapore than China, with nearly 1.48 million in the first half of 2013 compared to China’s 1.24 million. However, it is simply a matter of time before this changes. Chinese tourist numbers increased by 27 percent in the first half of 2013 compared to 2012, while Indonesian tourist numbers only saw an 8 percent increase.
In the period 2009 to 2011, visitors from China grew at an impressive compound annual growth rate (CAGR) of 30 percent, now making up 16 percent of the 7.7 million visitors Singapore received in the first half of 2013.
In light of China’s surging numbers of outbound tourists generally, driven by China’s increased affluence and growing consumer class, this news shouldn’t come as any surprise.
Singapore is just one of the many Asian countries reaping the benefits of proximity to China. Euromonitor International, a global market research firm based in London, released a list of Chinese tourists’ top 25 destinations in 2012. Asian destinations (including Hong Kong, Macau and Taiwan) took up 9 of the top 10 spots, with the US edging in at number 7. Singapore featured at number 6, accounting for over 2 million visits.
While the top-tier Chinese cities of Beijing, Shanghai and Guangzhou have led the growth in outbound travel over the past decade, secondary cities are now also starting to see a share of the action. Over 20 airports in China now service flights to Singapore, with over 350 flights travelling to the island nation every week. There remains much untapped growth potential in these second and even third-tier cities, with populations exceeding one million in over 160 of these cities.
You can stay up to date with the latest business and investment trends across Asia by subscribing to Asia Briefing’s complimentary update service featuring news, commentary, guides, and multimedia resources.