South Korea recorded its largest tourism deficit in six years during the first half of 2024, according to data released Thursday. The deficit, which measures the imbalance between the money spent by Korean travelers abroad and the spending by foreign visitors in Korea, soared to $6.48 billion from January to June.
This figure represents the highest deficit for the first half of the year since 2018, when it reached $7.83 billion. The travel trade balance is calculated by subtracting the amount spent by foreign tourists in Korea from the amount spent by Koreans traveling overseas.
Korean tourists spent $14.32 billion on international travel, while foreign visitors contributed $7.84 billion to Korea’s tourism revenue, according to data from the Bank of Korea (BOK) and the Korea Tourism Organization (KTO).
Despite a notable increase in international tourism, the surge has not translated into proportional revenue gains for Korea. The KTO reported that 7.7 million international visitors arrived in Korea in the first half of 2024, representing 91.3 percent of pre-pandemic levels from 2019. In comparison, outbound Korean travel reached 93.4 percent of pre-pandemic numbers, with 14.02 million Koreans traveling abroad.
However, spending by foreign tourists in Korea was only 75.4 percent of the amount recorded in 2019, while Korean expenditure abroad amounted to 89.2 percent of 2019 levels.
The BOK attributed the significant deficit to the weakened Japanese yen, which has fallen to its lowest level against the U.S. dollar in three decades due to Japan’s prolonged ultra-dovish monetary policy. This depreciation has led to a 42 percent increase in Korean travelers to Japan, totaling 4.44 million in the first half of the year. This represents more than one-third of all outbound Korean tourists and a 15 percent increase from the same period in 2019.
Hana Card, a Seoul-based credit card company, reported that its customers spent 431.4 billion won ($316.97 million) traveling to Japan from January to June, more than double the amount spent during the previous year.
Industry experts attribute the lower spending by international tourists in Korea to a shift towards individual rather than group travel and a greater focus on activities and cultural experiences rather than shopping.
In response to the growing travel deficit, the Ministry of Culture, Sports and Tourism is prioritizing strategies to enhance spending by international tourists, aiming to not only increase visitor numbers but also boost their expenditure in Korea.
Related Topics:
