(Yicai) Nov. 12 -- China's revenue from inbound tourism could reach USD470 billion by 2040, accounting for 1.5 percent of the country’s gross domestic product, according to the head of China leisure and transportation research at UBS Securities.

As international flight networks expand, visa-free policies are further eased, and overseas visitors show growing interest in traveling and spending in China, inbound tourism is expected to become a key driver of China's services consumption growth, Chen Xin said at a media briefing on Nov. 10.

China's inbound tourism is expected to grow by more than 20 percent next year, he noted, adding that the growth mainly comes from three factors, along with favorable visa policies, more convenient payment options, and other services.

First, China is one of the safest countries in the world, drawing more and more overseas tourists and business travelers to return, bringing friends and family. Second, Chinese airlines have been steadily adding international routes, improving air connectivity with global markets. Third, Chinese airfares are more competitive than those of their overseas peers, partly because they can fly in Russian airspace.

The expansion of the aviation network is also helping China become an international transit hub. For instance, the share of international transit passengers at Shanghai’s two airports rose to 35 percent this year, up from 10 percent in 2024.

Chinese carriers have added multiple European routes and expanded into markets such as Canada this year, Chen said. As international flight volumes continue to increase, China is expected to further strengthen its position as a hub in the global aviation network.

In terms of consumption, inbound tourists are contributing not only through passenger traffic but also through spending on shopping, hotels, and other services. Their per-capita spending is about USD800, according to data disclosed by Chen.

Moreover, as more and more foreign visitors extend their trips from first-tier cities, such as Beijing, Shanghai, and Guangzhou, to smaller cities like Hangzhou, Nanjing, and Suzhou, in-depth tourism is expected to drive travel and consumption demand in more destinations.

China's manufacturing sector offers a wide range of products at competitive prices, with similar goods at airports and other retail channels typically priced 20 to 30 percent lower than overseas, giving overseas visitors more shopping options, Chen said.

Sustaining long-term inbound tourism growth will require continued supply-side improvements, including adding more international destinations and flights, expanding high-end hotel supply in different cities, and improving the convenience of visa, payment, and transportation services, Chen suggested. Over the next few years, the expansion of international flight networks and overseas travelers’ spending will be key indicators for China's inbound tourism growth.

Editor: Futura Costaglione