This episode covers the resumption of international travel with comments from Tammy Qiu, vice chair of the European Chamber’s Aviation and Aerospace Working Group; border reopening between the Mainland and Hong Kong; and Caixin’s data on business activity in December. From the Chamber side, on 9th January, a delegation kicked off its first in-person European Tour in Brussels after three years of the pandemic.
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Aviation bodies’ joint statement on new EU recommendations for travel from China:
Border reopening between Hong Kong and Mainland China:
Caixin China General Services PMI
RUI: Hello and welcome to China Shortcuts,
MARIANN: the European Chamber’s weekly catchup about the Chinese business landscape.
RUI: On the 8th of January, China took a major step towards reopening to the world. Inbound travelers no longer have to quarantine and pre-departure testing requirements were streamlined. China also cancelled its pandemic related restrictions on outbound travel and resumed issuing travel documents for Chinese nationals. Following this, many countries introduced new curbs on travellers from China, citing the prevalence of COVID-19 in the country and concerns that new COVID-variants may arise, as justification for doing so.
MARIANN: A new EU recommendation, issued on 4th January, suggests that passengers travelling from China to the EU should be required to present a negative PCR test result. Several aviation bodies, including the International Air Transport Association released a joint statement the following day, which pointed out that the EU’s recommendation was at odds with the most recent assessment by the European health authorities. At the beginning of January, the European Centre for Disease Control and Prevention stated that it did not expect Europe’s own epidemiological situation to be impacted by the current surge of COVID-cases in China. The joint statement called government authorities to stop testing inbound passengers and instead test wastewater from airports and aircraft coming from China as an alternative method for tracking COVID.
RUI: To find out more about what to expect in the year ahead with regards to the resumption of international travel, we reached out to Tammy Qiu, Vice Chair of the European Chamber’s Aviation and Aerospace Working Group.
Tammy Qiu: Echoing the joint statement by the industry organisations, we expect EU Member States and China could work together for an agreed-upon entry requirements benefiting people’s mobility and economic development from the business perspective.
With the reopening of China’s borders, there is one thing for sure, that is: dramatic recovery of the Chinese civil aviation industry. The CAAC expects to see a notable rise in air traffic in 2023, reaching about 75 per cent of pre-pandemic levels. It was justified by both Chinese and foreign airlines busy with filing passenger flights resumption under the Bilateral Air Services Agreement, known as BASA. But nothing could happen overnight, international flight resumption heavily relies on further relaxation of travel restrictions, air travel demand, airlines’ reactivation and mobilisation of aircraft and crew, ground operations at airports, etc. We anticipate all concerned parties could pull together for a common goal of the industry rebound in 2023.
RUI: Tens of thousands of people crossed the border between the Mainland and Hong Kong on the 8th of January, as the Mainland reopened its borders.
MARIANN: The Hong Kong government announced that a maximum of 60 thousand people will be allowed to cross the border daily during the first phase of the reopening. The two sides will then review their experiences following the first week of reopening, and make decisions on the second phase’s arrangements accordingly.
RUI: The Caixin China General Services purchasing managers’ index indicated that the service sector’s activity continued to fall in December, as ongoing efforts to contain the spread of COVID undermined business operations and demand.
MARIANN: Business activity fell to a six-month low in December. That said, the rate of contraction softened compared to previous months, and firms operating in the service sector showed renewed optimism, projecting a strong recovery from the pandemic in the year ahead. The composite PMI, that includes both manufacturing and services activity, also showed a softer decrease in business activity in December. Demand, however, remained lacklustre, with new orders dropping further, particularly in the manufacturing sector. The Caixin Insight Group has pointed out that in order to boost consumption, Chinese policymakers will have to put forward policies aimed at stabilising the job market and residents’ disposable income.
RUI: After a three-year break due to the COVID-pandemic, the European Chamber kicked off its first in-person European Tour on the 9th of January, sending a delegation to Brussels for a week long tour.
MARIANN: The Chamber’s president, vice presidents, board members and senior working group representatives will meet with European authorities as well as industry and business associations. During these meetings, our delegates will ensure the Chamber’s voice is heard on key issues, detail what the current situation is like on the ground for businesses operating in China, and, present the main findings of our most recent research reports.
RUI: Thanks for listening. Tune in again next week.
MARIANN: In the meantime, find useful links in the episode notes.