South Korea's Tourism Deficit Hits a New High

In 2024, South Korea experienced a tourism deficit exceeding $10 billion, a record that underscores the growing economic challenges in the sector. Despite a significant rebound in the number of foreign tourists visiting the country, the revenue generated from tourism has not kept pace with the increasing outbound travel expenditure by South Koreans.

Recovery in Tourist Numbers, But Not in Revenue

The number of foreign tourists visiting South Korea reached 16.37 million in 2024, nearly 93.5% of the pre-pandemic level in 2019. However, tourism revenue only amounted to $16.45 billion, a mere 80% of the 2019 level. This discrepancy highlights the slow recovery in tourism revenue compared to the rapid increase in visitor numbers.

Factors Contributing to the Tourism Deficit

Yanolja Research points to the decline in duty-free sales and the short stay duration of cruise ship tourists as key factors behind the sluggish tourism revenue. Additionally, the rapid rise in South Koreans' overseas travel spending, which reached $26.49 billion last year, further exacerbates the tourism deficit.

The Impact of Reduced Chinese Tourists

The growing tourism deficit is also attributed to the significant decline in Chinese tourists. With only 4.6 million Chinese visitors in 2024, representing 76.4% of the 2019 level, the absence of this major tourist group has had a profound impact on South Korea's tourism revenue.