Correlation Between Chinese Outbound Tourism Numbers and Chinese Outward Foreign Direct Investment Study

Abstract

Before the COVID-19 pandemic, the world’s tourism industry maintained a steady growth trajectory, with an average annual growth rate of about 4%. Chinese tourists accounted for a larger share of world tourism market consumption. By 2013, China had become the world’s largest outbound tourism market. According to data published by Statista, Chinese tourists accounted for 21% of the world’s tourism spending 2016 (approximately US$261 billion), making them among the world’s highest-spending international tourists. After entering the 21st century, the scale of China’s outward foreign direct investment has increased and has been influenced by various factors. As the number of outbound trips increased following the improvement of the living standards of the Chinese people, the extent to which the tourism industry influenced China’s outward investment also increased. This research investigates the relationship between the number of outbound Chinese travelers, a crucial indicator in the tourism domain, and its impact on Chinese outward foreign direct investment. Data from 26 countries across different continents were collected as the primary data source for this study. Through the research of mixed regression analysis and robustness test, it is found that the number of Chinese outbound tourists has a positive correlation with the impact of Chinese outward foreign direct investment. This outcome holds significant implications for informing China’s Outward Investment policies and guiding global expansion strategies for enterprises in the post-pandemic era.