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By Kang Seung-woo
Korean consumers' spending on traveling abroad hit a three-year low this year, dented by the economic recession and the "Boycott Japan" movement, according to a recent study, Thursday.
However, sentiment toward spending on domestic travel also shrank without benefiting from the decline in overseas travel.
Consumer Insight, a local tourism industry research lab, released its annual "weekly travel behavior and planning study" after interviewing 22,500 people about any likely changes in both domestic and overseas travel spending in the next year. "Travel spending intention" is a response rate for those who said they would increase their travel spending.
According to its report, the intention to spend on overseas travel from January to October this year was 39.2 percent on average, down 3.1 percentage points from 42.3 percent in 2018. The rate for overseas travel soared in 2017 to 43.2 percent when there were two long public holidays and it dropped to 42.3 percent the following year.
As for the intended spending for domestic travel, it also fell by 1.5 percentage points to 34.5 percent this year, posting a decline for the second straight year. It dropped by 2.5 percentage points last year.
The company said the declining intention to spend on travel was due to the nation's massive boycott of traveling to Japan in the wake of Tokyo's economic retaliation.
In July, the Japanese government imposed restrictions on exports of three industrial materials to Korea and removed Seoul from its list of preferred trading partners, following a Korean top court ruling last year requiring Japanese firms to compensate surviving South Korean victims of forced labor during World War II. Angered by the Japanese government's move, Koreans have staged a campaign boycotting Japanese products and refrained from traveling to Japan ― which had been a popular destination for Korean travelers.
The intention to spend on overseas travel from January to June was staying at around 40 percent, but travel sentiments toward Japan cooled rapidly in July, and the intention to spend on overseas travel fell by 3.2 percentage points to 37.5 percent ― the lowest in 37 months since May 2016 when it hit 33.3 percent. Since then, there have been no signs of a rebound.
In recent years a growing number increased their spending on overseas trips rather than domestic ones, with the gap between international and domestic travel rising from 4.7 percentage points in 2017 to 6.2 percentage points in 2018. This is because the financial burden of airfare diminished due to the expansion of low-cost carriers, and in turn increased the viability of nearby destinations such as Japan, Taiwan, and Vietnam for short trips.
Although consumers' intention to spend abroad declined this year, domestic travel has failed to enjoy any benefit from the decrease in overseas travel.
Along with the shrinking consumer sentiment due to the economic recession, consumers believe they can get more bang for their buck from overseas rather than domestic travel, according to the research lab.
"It is not easy for domestic travel to regain consumer confidence," the report said.
"To attract their attention, Korea's domestic tourism industry needs to improve its competitiveness more than anything else."
