China travel restrictions may cost United States $10.3bn

Airlines have suspended flights, and officials are barring foreign visitors who have been to China in the past 14 days.

Passengers arrive at LAX from Shangha
Passengers arrive at Los Angeles International Airport from Shanghai, China, after a positive case of the coronavirus was announced in the Orange County suburb of Los Angeles, California on January 26, 2020 [Ringo Chiu/ Reuters]

Travel restrictions related to the novel coronavirus from China could impact city and state economies across the United States, which have benefitted from a huge jump in tourism from China in recent years, analysts say.

Riverside, California, and Buffalo, New York, the closest big town to the vast Niagara Falls, would be among the hardest hit in a list of places from big cities to tourist towns particularly popular with Chinese visitors.

Major US airlines have suspended flights from China, and the Trump administration is barring foreign visitors who have been to mainland China over the past 14 days.

A fall-off in visits from China represents the “most immediate and direct link between the US economy” and the virus, said Mark Zandi, the chief economist at Moody’s Analytics. He projects real gross domestic product growth at 1.7 percent this year, just below the US economy’s 2 percent potential growth rate.

Visits from China to the US have increased 1,270 percent since the severe acute respiratory syndrome (SARS) virus outbreak in 2002, to 2.8 million in 2019, according to Tourism Economics, part of research firm Oxford Economics.

The figure includes students and tourists. About 15 percent of visitors from China indicate “education” as the purpose of their visit in the Department of Commerce Survey of International Air Travelers, Oxford Economics said.

The virus will result in a $10.3bn loss in Chinese visitor spending in the US, most of that in 2020, Oxford Economics estimates.

Each visitor spends an average of $6,000 per trip, not including airfare or money spent on education, the research firm says.

The impact of those losses won’t be spread evenly around the country. Visitors from China tend to flock to big US cities such as Los Angeles and New York City, Tourism Economics found.

However, they also visit outlet shopping malls and national parks. When Chinese visits are evaluated as a percentage of overall overseas visitors, the city of Riverside in Southern California is the most visited, and Buffalo, New York is near the top.

On a state-by-state basis, California receives the highest concentration of overseas visitors from China, followed by Utah.

Source: Reuters