Tourists are photographing early blooming sakura trees in front of the Tokyo store. Early bloom of Sakur trees in Tokyo, especially varieties like Kawazu-Zakura, usually start to bloom in late February to early March, in front of the usual cherry cherry flowers, which are the culmination of the end of March to early April. The phenomenon is tied to mild winter and specific varieties, offering a vivid pink spectacle against Tokyo’s urban background before the main cherry flowering season begins.
Sopa pictures | Lightrocket | Getty Images
Foreign tourists had a disproportionately great impact on Japan’s economic growth in recent years. However, their influence could start failing as Jen is stronger, analysts said.
Tourists were a key initiator of the revival of the Japanese economy. Many have attracted weakness in Jen, which is why shopping, fun, transport and overnight stayed cheaper.
What happens if the tide turns and yen stronger?
Consumption for travel in Japan has increased in recent years. Indeed, entry tourism has contributed to half Throughout the year, the Japanese GDP growth rate of 1.5% in 2023, and 0.4 percentage points to 0.1% of the annual GDP growth in Japan last year, according to the MasterCard Economics Institute.
Indicates a dramatic change in the composition of the fourth largest economy in the world. Tourism contributed an average of 0.1 percentage points to GDP from 2010 to 2019, at a time when the GDP Japan growth rate was 1.2%.
Mei’s report showed that the weaker Jen had done Japan a more attractive destination for shopping. This is in great opposition to other countries around the world, said the chief economist of Mei for Asian -Pacific David Mann, where tourists prefer experiences, such as going to a restaurant, concert or bar.
Japan was one of the strongest travel destinations in Asia. So much so that, according to the Japanese tourist organization, the country saw record 36.9 million visitors’ arrivals for the whole 2024.
Not only that, they also spent more tourists, with preliminary data showing that the annual consumption of international visitors Japan 2024. a record high of 8.1 trillion yen (54.06 billion USD), a huge 53.4% increase compared to a year ago.
An average individual consumption among foreign passengers in Japan increased by 6.8% to 227,000 yen. However, some of Clement conditions that have made this greater interest in tourism could be revealed.
Higher domestic inflation has encouraged the Japan bank to increase interest rates, unlike other large central banks that reduce rates. That in turn launched yen strengthen up to a five -month maximum compared to the US dollar on March 11th.
Japanese flourishing tourist industry
Yujiro Goto, head of the FX strategy for Japan in Nomura, told CNBC that weaker entry tourism would be negative on Japan’s growth.
This is because Jena’s weakness was one of the key reasons for accelerating entry tourism. Significant gratitude is expected to reverse this trend in the currency.
Jen was last seen traded to 148.26 compared to Greenback, strengthening about 7.2% over the maximum 2025 of 158.87.
A little gratitude in Jen, who was in historical lowest levels, “as from $ 161 to 146 so far against USD, he may not change the trend, in my opinion,” Goto said.
Min JOO KANG, an older economist for Japan and South Korea at the Netherlands Bank Ing, shares this view, but also pointed out that entrance tourism can still have room for growth, since the number of Chinese tourists has not yet recovered at the level before the Courid.
“The measures announced during the weekend for increasing consumption also include supporting higher wage growth and stimulation of Chinese property markets. This can cause an increase in Chinese outgoing tourism,” she added.
Beijing appeared on Sunday Plan to increase consumption, referring to measures to increase wages, as well as “multiple measures” for stabilization of the stock market, among other things.
The weaker growth of tourism does not necessarily mean that the spread of GDP Japan will fall off the cliff. Mei’s Mann said that the contribution of domestic consumption in Japan is expected to improve, given the strong labor market and wage increase.
This photo taken on February 20, 2025, shows 634 m (2,080 ft.) Tokyo Skytree (L) from the rail line in the Oshiage area in the Japanese capital.
Kazuhiro Nogi | AFP | Getty Images
The largest Japanese union announced last Friday that he was able to secure the average 5.46% wage increase Since April, the highest increase in 34 years.
“So tourism can be facilitated, but then domestic consumption can be taken as a growth driver,” Mann said.
If there is an appointment of Japanese Jen, Ing -Av Kang said he would have a more positive impact on domestic economy, increasing private consumption and services.
Tourism
Goto also said the gradual power in Jen could slow down the cost of costs and improve the actual salary among the domestic residents. This would help switch the contribution of GDP to the side of consumption to domestic consumption.
Furthermore, he said that, although Oversourism became a major problem in regions like Kyot, foreign demand obviously supports salaries and loops with positive feedback on inflation that battle wants to achieve.
He also pointed out that “Regional Governments can consider higher taxes for foreign visitors (hotels, airports, etc.), which can support the Japanese fiscal situation while managing tourist streams.”
Mann concluded, saying that tourism was a far greater contribution than anyone would have expected in the last two years, “and” would remain a significant contribution to the Japanese economy before further allevia and replaced the slightly stronger contributions of domestic consumer consumer. “
“Jen weakness is likely to start reverse at least this year, but it will be a long -term process, not to turn in just once or two months.” Mann added.
