On the 8th, China's news site Guancha.cn published an article titled, "What hints does the collapse of Japan's tourism bubble, which Japan experienced, offer to China's tourism industry?"

The article explained that "2015-22 is considered the period when the tourism development investment bubble was most overheated in China. Projects worth billions to tens of billions of yuan successively emerged in various places, and many of them were models combining real estate development with tourism development." It stated, "This situation is very similar to Japan's from 1985-91. At that time, Japan also experienced a tourism development investment boom, followed by a bubble collapse."

Furthermore, it looked back, saying, "Against the backdrop of the strong yen in 1985, stock prices, real estate, and land prices soared in Japan, and investment fever intensified. In 1987, the government enacted the Comprehensive Resort Area Development Law (Resort Law), which promoted resorts, luxury golf courses, theme parks, and tourism destination development. Local governments provided vast undeveloped land to developers, who proceeded with real estate development and tourism development as an integrated whole. Land prices surged just by announcing plans, and investment became overheated."

On the other hand, it pointed out, "With the collapse of the real estate bubble in 1992, the situation completely changed, and many resorts and theme parks faced debt crises, bankruptcy, and disuse (land being left unattended)." It added, "This is extremely similar to the problems faced by ancient towns and resort facilities in China today. Japan did not solve the collapse of the tourism development investment bubble all at once, but rather digested it over a long period of time."

The article cited "the abrupt halt of large-scale tourism development" as its first stage, stating, "Until then, the government had supported investment through tourism promotion plans, infrastructure development, and low-interest loans, but after the collapse, it shifted to the view that the market should judge investments. It gradually reduced its active involvement in tourism development investment and also terminated aggressive economic stimulus measures."

It then pointed out, "This point is very similar to the current situation in China. China's tourism development investment bubble also had an aspect where it greatly expanded due to support from local governments, which provided preferential land treatment and financial support for projects lacking market viability, or had local government-affiliated investment companies and tourism development companies undertake projects. As a result, a tourism development investment bubble was created."

Next, in the second stage, it stated that "market-driven selection progressed," and "this was the most difficult stage after the bubble burst. While banks, zaibatsu, and investors assessed future prospects and injected funds into reconstructible tourism development projects to advance their reconstruction, many resorts, golf courses, and theme parks developed in areas far from Tokyo and Osaka were written off. About one-third of tourism development projects failed, and ruins from that time still remain in Hokkaido and Nagasaki today."

The third stage was described as "project regeneration and renovation," which "began in earnest after 2000. Many tourism development investments were made based on overly optimistic forecasts, and there were discrepancies in project scale and direction. During Japan's bubble period, the construction of facilities recreating European streetscapes was popular, but these projects, like the construction of tourist destinations mimicking historical Chinese streetscapes, were superficial, lacking substance, and failed to attract visitors,' it pointed out.

It then introduced, "In Japan, new investors who took over businesses carried out major renovations, downsizing and clarifying target demographics. Large-scale theme parks were transformed into smaller facilities for children or facilities leveraging local characteristics, and European-style streetscapes were renovated into wedding venues or filming locations. Some were converted into highly public facilities like parks and museums." It added, "Similar changes are also occurring in parts of China today; Dayong Ancient City in Zhangjiajie, originally a tourist facility, no longer met demand, so it attracted production companies as a filming location for dramas and programs, transforming into a unique commercial area for the film industry and fans."

The fourth stage was described as "adjustment and evolution aligned with the times," and it introduced, "For example, Yomiuri Land struggled after Tokyo Disneyland opened, but as a theme park, it couldn't compete with Tokyo Disneyland, so it launched its own unique approach, introducing live events and collaborations with anime. To cope with the declining birthrate, it held festivals and illumination events targeting couples and adult visitors, and also promoted various initiatives, such as planning experiential events where visitors could create crafts themselves."

It then stated, "China's tourism development projects are also moving in the direction of aiming for evolution and updates, similar to Japan. In recent years, new operational methods such as small-scale performances in scenic spots, performances by cast members, themed events, and collaborations with characters have been spreading."

The article concluded, "China is also treading a similar path to Japan. From the era of soaring real estate prices, local governments strongly pushed investment in tourism development projects, and later, as the real estate market cooled, a series of tourism development projects in various regions became stagnant. Currently, China's tourist destinations are also undergoing difficult adjustments. They are trying to break away from large-scale tourism products that lacked substance, analyze the market, and shift towards exploring the actual needs of tourists," while indicating that it is difficult to foresee how long this "adjustment" will continue. (Translation and editing by Kitada)