China’s appetite for travel hasn’t faded with the end of summer. Whether it’s by train or by car, hundreds of millions of people are traveling around mainland China for a holiday called Golden Week. From the Mid-Autumn Festival on Friday, Sept. 29, to the following Friday, the break runs for an entire week to celebrate China’s National Day. It’s a rare opportunity to take a lengthy vacation in a country where workers typically only get a few paid days off each year. Just over 60% said they would increase their travel budget for this holiday, according to a Bank of America survey in September. One third of respondents said they would spend 5,000 yuan ($680) to 10,000 yuan per person; a group nearly as large said they would spend 10,000 yuan to 20,000 yuan. That includes airfare and hotels, the report said. So where are they going? A separate survey by Morgan Stanley in August found that people in China overwhelmingly say that Hong Kong and the southern province of Hainan are their most popular destinations for shopping while on a trip. Since the pandemic, government efforts to build the island of Hainan into a duty-free shopping center have paid off as people in China stayed within its borders. Morgan Stanley analysts like Hong Kong-listed CTG Duty Free , China’s state-owned duty-free retail giant. They have an overweight rating on the Hong Kong-listed shares, with a price target of 145 Hong Kong dollars — nearly 44% up from where the stock closed Thursday. “We find the emerging trend of: 1)shopping budgets being cut for outbound travel but stable for domestic travel, and 2) a shift in shopping destination, with Hainan gaining popularity, as encouraging,” Morgan Stanley analysts said in a Sept. 18 report. While Hainan is still building out its range of luxury product offerings, the tropical island is attracting China’s wealthy for other reasons. “Hainan was already winning because of convenience. They’re also winning now on scenery, they’re winning on shopping prices, winning on hotels,” Imke Wouters, partner at consulting firm Oliver Wyman, said in an interview. The firm surveyed 3,858 affluent Chinese consumers in September. That’s a category with a minimal household income of 30,000 yuan — representing just 5% of China’s total population last year, according to Oliver Wyman. Their study found the majority of Chinese luxury spending in the near term will remain in China, and the casual luxury consumer has become more cautious due to concerns about…
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