SLOW TOURIST RECOVERY FALLS SHORT OF EXPECTATIONS

After two years of the COVID-19 pandemic, Taiwan’s inbound tourism recovery is ongoing, with 7.85 million visitors recorded in 2024, reaching only 80% of pre-pandemic levels. Even though inbound tourist numbers over the first eight months of 2025 are up by 10% YoY to 5.45 million, the 2025 target of 8.50 million visitors set by the Taiwan Tourism Administration is still short of the prepandemic annual benchmark of 10 million inbound tourists. In the meantime, the number of outbound travelers stood at 12.61 million, up 10% YoY, and the substantial deficit in tourist numbers is posing considerable challenges to the local tourism market.

Japanese and Hong Kong travelers have dominated the market, accounting for 16.3% and 15.9% of total inbound tourists in the first eight months of 2025, respectively. However, due to recent natural disasters in Taiwan and the weakening of the Japanese Yen, the number of Japanese tourists is significantly lower than the pre-pandemic level of 2 million per year. China previously accounted for over 20% of inbound tourists; however, restrictions on China travel groups has led to a sharp decline in Chinese visitor numbers, from 2 million to 500,000. To promote the local tourism market, the Taiwan government is targeting Southeast Asian countries through visa-free policies, which has resulted in a significant improvement in visitor numbers, with the share of Southeast Asian tourists reaching 30%, primarily from the Philippines and Vietnam, helping to drive demand for budget and business hotels.