A reduction in tourist visitors to Okinawa due to coronavirus, anticipated to be around 500,000, could lead to a decrease in tourism revenue of 28.1 billion yen, cause 1,940 job losses

A reduction in tourist visitors to Okinawa due to coronavirus, anticipated to be around 500,000, could lead to a decrease in tourism revenue of 28.1 billion yen, cause 1,940 job losses


February 20, 2020 Ryukyus Shimpo

The Nansei shoto Industrial Advancement Center (NIAC, Mitsuru Omine, president) announced their estimation of the effects the corona virus would have on the Okinawan economy February 19.

They estimate that the effects of the virus would continue from February through July, and could potentially lead to a decrease in tourist visitors of around 500,000 people, equating to a decrease in tourism revenue of about 28.1 billion yen.

The NIAC is predicting that 300,000 visitors from China, roughly 40% of the 750,000 Chinese visitors that came to Okinawa in 2019, would cancel their travel plans to Okinawa. In addition to the Chinese visitors, if the virus causes from other countries as well as domestic visitors to cancel their plans, the total number could reach 500,000 cancellations.

The following decrease in tourism revenue, which comes mostly from lodging and dining, could lead to an adjustment in employment, and the NIAC is estimating job losses around 1,940.

The nominal GDP, which excludes things such as purchase price, could also see a decrease of around 19.6 billion yen, from sources such as a decrease in personal expenditure related to job losses as well as a decrease in capital investment due to a low growth rate.

The real GDP is predicted to be 0.2%, and tax revenues, calculated as both national and local tax, could decrease 3.8 billion yen.

If domestic tourists continue to visit as usual, but there is still the predicted 300,000-person decline in Chinese visitors, the loss of revenue would only be 13.8 billion yen, with a 940 decrease in jobs.

Chinese tourists, compared to visitors from other foreign countries as well as domestic tourists, have a higher per-person expenditure, whether arriving by plane or by sea, so a decrease in visitors quickly has a major impact on the overall tourism revenue.

NIAC senior researche Takeshi Kinjo indicates, “We are already seeing cases of visitors from foreign countries other than China as well as domestic tourists cancelling their travel plans.

While it is difficult to foresee when this issue with be resolved, if the spread of the virus continues for a lengthy period of time, the effects could become even more drastic.”

(English translation by T&CT and Sam Grieb)

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