The weakening yen has turned Japan’s annual Golden Week, a string of springtime holidays, into a boon for domestic tourism.
The uptick in the traditional May holiday week points toward one of the best years on record for Japan’s tourism industry, still recovering from the earthquake and tsunami of March 2011. The yen’s slide, part of Prime Minister Shinzo Abe’s drive to boost economic growth, is luring overseas travelers while tempting Japan’s holidaymakers to stay home. Tokyo Disneyland expects a record number of visitors this year.
About 22.8 million Japanese, or nearly a fifth of the population, will travel during the holiday period from April 25 to May 5, according an estimate from JTB Corp (JTBZ). That’s the most since at least 1969, when Japan’s biggest travel agency began the survey. Some 22.2 million of those will travel domestically and spend about 35,900 yen ($360) per trip, 2.9 percent more than last year, according to the agency.
“The exchange rate does affect my plan to travel,” said Shizue Ohshima, 62, a housewife from the Kanagawa prefecture who is headed to the Noto peninsula about 360 miles (585 kilometers) northwest of Tokyo during Golden Week. Three or four years ago she visited Korea.
“I like Korean culture but it will be more expensive if I go now,” said Ohshima. “Domestic travel is a lot cheaper.”
An 18 percent decline in the yen against the dollar this year shows how it has become cheaper for foreign travelers to visit. Overseas tourists to Japan rose 26 percent in March from a year ago to 857,000, the second highest on record, according to the Japan National Tourism Organization. That’s boosting revenue for businesses from bullet trains to tourist-friendly eateries like the Robot Restaurant in Tokyo’s Shinjuku nightlife district, where bikini-clad staff stage mock fights with others in android and giant panda costumes.
Southeast Asia Visitors
“The general trend for domestic travel this year is more expensive, nearer, and shorter,” said Mayuko Igarashi, a spokeswoman at Rakuten Travel Inc., an online travel agency. “Inbound travel from overseas is surging, it’s double last year’s as the weakening yen helps attract more visitors.”
The Japanese currency is forecast to weaken to 110 yen to the U.S. dollar in 2014 from an estimated 100 in the second quarter of this year, according to the median of economist estimates compiled by Bloomberg. Prime Minister Abe, in office since December, has pledged to use monetary easing and fiscal stimulus to lift Japan out of more than a decade of price falls.
Visitors from Thailand will increase nearly fivefold and tourists from Taiwan will more than double during Golden Week, according to a study from Rakuten. The Thai baht, the Korean won, the Chinese yuan, and the Singapore and Hong Kong dollar have all risen more than 20 percent against the yen during the last 12 months.
Okinawa reservations more then tripled while Kyoto bookings for inbound travelers increased 177 percent from the same holiday period last year, according to Rakuten.
“Overall, visitors from Asia are notably increasing,” according to JTB spokeswoman Akiko Mitsuhashi, who said one of the agency’s top selling tour destinations is a bus trip to Mt. Fuji and hot springs. “The weakening yen is helping them come over here.”
Oriental Land Co (4661)., the operator of Tokyo Disney Resort, which had a record 27.5 million visitors last fiscal year, is expecting a fresh record of 27.7 million visitors this year, said Umi Ishimura, a spokeswoman. Foreigners make up about 3 percent of the resort’s customers.
At the Robot Restaurant, where nightly floorshows feature performers riding giant prehistoric creatures as well as robots and sword-wielding pandas, non-Japanese customers are on the rise.
Foreign visitors rose from about 10 percent last summer before the yen began to weaken to about 30 percent today, said Yumi Ito, a spokeswoman for Josen Musical, the operator of Robot Restaurant. The venue also boosted advertising during the same period, she said.
Central Japan Railway Co (9022)., operator of Japan’s busiest bullet trains, said bookings for its high-speed service during Golden Week were up 6 percent compared with a year earlier, at 1.22 million seats.
“There are a lot of passengers coming to Tokyo this year,” said Kenichiro Yakura, a spokesman at for the rail operator. “Many people want to visit Tokyo Disneyland for its 30th anniversary and see Tokyo Skytree,” the capital’s latest landmark tower.
The start of operations at three low-cost carriers last year is also drawing more people to the skies. Peach Aviation Ltd (AFACZ)., the only one of the three that was flying last May, said reservations for domestic flights nearly doubled to 55,077 seats during Golden Week, as it boosted capacity 90 percent.
Occupancy rates at the Tokyo’s Imperial Hotel are higher during Golden Week than a year ago, said spokesman Akitaka Minakata, who attributes the increase to Japanese families in town for sightseeing.
Foreign guest occupancy rates are still recovering from the 2011 earthquake and tsunami, she said.
“People say the recent trend for travel is more expensive, nearer, and shorter, and that fits my traveling style,” said Mineko Yamaguchi, 74, a housewife from Urawa, Saitama.
“I’m not going anywhere during the Golden Week aside from visiting family graves.”
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