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When Will Cross-Strait Tourism Return to Normal?

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When Will Cross-Strait Tourism Return to Normal?

Tourism between Taiwan and China has been heavily impacted by political tensions. What’s the outlook under the Lai administration?

When Will Cross-Strait Tourism Return to Normal?
Credit: Depositphotos

Tourism between China and Taiwan has declined sharply under Taiwan’s outgoing President Tsai Ing-wen due to travel restrictions imposed by both sides. After years of disruption, many people are hoping that cross-strait tourism will soon return to normal. A study of what is motivating Taipei and Beijing to maintain their respective travel restrictions, and a look at China’s recent history of limiting tourism to Taiwan, indicate that it could be quite some time before bilateral tourism numbers rebound to past highs. 

Tourist travel between China and Taiwan has been severely limited since August 2019, when Beijing stopped issuing permits for individual Chinese tourists to visit Taiwan. The COVID-19 pandemic then led Beijing and Taipei to each impose their own sweeping restrictions on cross-strait travel, which effectively brought tourism between the two sides to a halt for nearly three years. With the worst effects of the pandemic finally behind them, China and Taiwan began restoring their tourism ties last winter. However, major restrictions remain in place, keeping bilateral tourism figures extremely low. 

According to tourism data compiled by Taiwan’s Mainland Affairs Council (MAC), fewer than 13,000 Chinese tourists visited Taiwan during the first 11 months of 2023 compared with approximately 1.9 million Chinese tourists in all of 2019. The MAC stopped tracking the number of Taiwanese tourists visiting China in 2020. But given Taiwan’s current restrictions on tourism to China, the poor state of cross-strait relations, and the fact that China has seen underwhelming tourist numbers in general since it reopened its borders to foreign visitors, China is almost certainly also suffering a dearth of Taiwanese tourists.

Taipei began gradually easing its cross-strait travel restrictions last January. It started by allowing residents of Taiwan’s offshore islands and their Chinese spouses to travel by chartered ferry between the islands and China’s nearby Fujian Province during the Lunar New Year holiday. Taipei then proceeded to lift more travel restrictions; in August, the MAC announced that the government would permit Chinese tourists from third locations to visit Taiwan from September 1. More recently, Taiwanese officials have indicated that the government intends to lift its ban on Chinese group tours to Taiwan and other remaining cross-strait travel restrictions on March 1.

Taiwan’s motivation for restricting cross-strait travel was to limit the spread of the COVID-19 virus. However, the restrictions had the added benefit of aligning with the Tsai administration’s mission of reducing Taiwan’s heavy economic reliance on China. Even before the pandemic, Tsai was working to lessen the country’s dependence on China as a tourism partner by boosting Taiwan’s tourism ties with Southeast Asian and South Asian countries as well as Australia and New Zealand through Taipei’s New Southbound Policy. 

Since the effects of the pandemic abated, Taipei has tried to use its travel restrictions as a bargaining chip to negotiate with Beijing.

Initially, Taipei hoped to engage with Beijing “through established mechanisms” to negotiate and prepare for the full restoration of cross-strait tourism ties. But Beijing, while it reopened its borders to Taiwanese group tours last May, has refused to engage with Taipei or lift its own restrictions on Chinese tourists visiting Taiwan. 

In the leadup to Taiwan’s 2024 presidential and legislative elections on January 13, the Tsai administration came under domestic pressure to lift its remaining travel restrictions. Hou Yu-ih, the presidential candidate of Taiwan’s main opposition party, the Kuomintang, took a firm stance against Taipei’s ban on Chinese group tours during his campaign, winning the support of many Taiwanese tourism operators.

The Tsai administration’s decision to unilaterally lift its ban on cross-strait tour groups as of March 1, 2024, was a response to this pressure. The announcement, which came in early November 2023, was meant to appease constituents in Taiwan’s tourism industry before the elections.

Taiwanese officials have indicated that the plan to lift travel restrictions is subject to change. And according to the current plan, the number of Taiwanese group tourists allowed to visit China and the number of Chinese group tourists allowed to visit Taiwan (if and when Beijing lifts its ban) will each be capped at 2,000 per day. Moreover, the MAC has repeatedly warned of the “escalating risks” posed to Taiwanese citizens visiting China since Beijing revised its Counter-Espionage Law last May. Thus, the Tsai administration and the incoming administration of Lai Ching-te, Taiwan’s president-elect and current vice president, retain some room for maneuver.

Beijing’s history of restricting cross-strait tourism predates its 2019 freeze on permits for individual Chinese tourists to visit Taiwan. The decline in cross-strait tourism can be traced back to 2016, when Tsai Ing-wen was elected to her first term as president. Chinese tourism to Taiwan slowed before Taiwan’s 2016 elections and then dropped precipitously after Tsai took office. The Tsai administration claimed that Beijing had limited the number of Chinese tourists allowed to travel to Taiwan in order to pressure the new president into accepting its “One China principle” that Taiwan is part of China. 

After a long period of decline, Chinese tourism to Taiwan began to stabilize in late 2017. And, following Taiwan’s November 2018 local elections, Beijing rewarded newly elected local officials in Taiwan who had expressed support for the “1992 Consensus” and closer ties with China by resuming a cruise line that brought Chinese tourists to their territories. 

Given Beijing’s antipathy toward Lai Ching-te, however, China is likely to continue using its restrictions on tourism to try to pressure him, as it did Tsai, to accept its One China principle. But both Beijing and Taipei have incentives to relax their remaining restrictions. Although Tsai and Lai want to further diversify Taiwan’s tourism ties, a moderate rebound in cross-strait tourism would not necessarily undermine their mission and would be beneficial to Taiwan’s economy. Absent major hostile actions by Beijing in between now and March 1, it appears that Taipei will follow through with its plan to allow limited cross-strait group tourism. 

While Beijing chastised Tsai and her Democratic Progressive Party (DPP) government for insisting on negotiations to restore tourism ties, it did not reject outright the idea of restoring ties. Rather, it placed the blame on Taipei for disrupting cross-strait travel. The Chinese leadership does not want to reward the DPP by allowing Chinese tourists and their money to flow to Taiwan. But it does place great importance on developing people-to-people ties with Taiwan to exert political influence, and without Taipei’s acquiescence it will have fewer Taiwanese tourists to try to woo. Beijing also wants to avoid helping the DPP succeed at permanently diminishing the Taiwanese tourism industry’s reliance on China. 

Therefore, Beijing may slowly relax its restrictions on cross-strait travel as it seems to have done in 2017; or it could take a more targeted approach by allowing larger numbers of Chinese tourists to return to Taiwan’s offshore islands and other locations where local politicians have expressed support for the 1992 Consensus and want deeper ties with China, similar to Beijing’s actions after Taiwan’s 2018 local elections.

Assuming that Beijing does not temper its Taiwan policy, cross-strait tourism numbers are unlikely to reach their past highs anytime soon. Beijing will continue to take a stick-and-carrot approach to tourism and Taipei will manage the issue in such a way as to avoid a sudden and overwhelming resurgence in cross-strait tourism.