Omicron shelves Japan's reopening, but in post-Chinese tourism era, businesses are back in blossom

Ryohei Shimazaki ploughed a hefty slice of his savings into his dream retirement business: a boutique cafe in Kamakura, about an hour south of Tokyo. With its temples, shrines, and Japan's largest seated Buddha, the old capital oozes with the kind of culture locals hold dear and tourists love to experience. As a mini-Kyoto of sorts, it was the perfect place for his new venture, and Shimazaki found a pretty spot by a well-trodden path to a famous shrine. A few years ago he took the plunge and opened his cafe.

He thought the timing had been perfect to get out of the "rat race" and serve his matcha teas, exotic coffees, cakes and light lunches to the steady flow of tourists, but it came close to being a total disaster.

"It was very stressful at times," he said, stepping out from the tiny kitchen. "We opened Sasuke Cafe in October 2019, and although we were busy for a short time with some Chinese and Russian tour groups, as well as Japanese tourists, by January it had completely stopped."

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When the coronavirus pandemic broke out, Shimazaki's cafe, like so many other local businesses, faced the very real prospect of failing as the free-spending tourists evaporated. Over the next year as Japan closed its borders and locked down, it saw a 7 per cent contribution to its economy from travel and tourism disappear. The loss of Chinese tourists was particularly dear - of the 4.81 trillion yen (US$42 billion) previously spent in the country in 2019 by its 32 million inbound tourists, a third came from Chinese visitors alone.

Yet despite the doom and gloom and ongoing travel restrictions - the emergence of the new Omicron variant this week put an end to Japan's tentative steps to reopen to business travellers - many tourism-facing businesses have found that, after the initial shock, they have learned to live with and adapt to their new normal. Shimakazi's cafe for instance began a lunch delivery service for local residents. Then, as local restrictions began to ease those same people became loyal customers.

Now, nearly two years on, many businesses that were once reliant on the tourist dollar have found they can manage just fine without it. Last year the Government mobilised 52.6 million domestic tourists with its "Go To" promotions.

Into the hole left by international tourism has stepped its domestic brother with about 1.8 trillion yen being spent so far this year on local trips, according to the Japan Travel Bureau Foundation. Businesses say that with more than three-quarters of the population vaccinated, Japanese feel safe to go out again and with a lack of international travel options are happy to spend their leisure money at home. For many, the lack of foreign tourists means less competition for tables at restaurants and fewer noisy tour groups to collide with.

Tucked away under the bullet train tracks a few minutes' stroll from Tokyo's posh Ginza district is a family-run seafood restaurant that opened in October 1945.

Shin-Hinomoto is famed for the freshness of its fish which are sourced daily from the nearby Tsukiji market, yet despite its popularity owner Briton Andy Lunt said things were touch and go at the start of the pandemic.

"We made it through the worst, when many of the businesses around here owned by both Japanese and gaijins [foreigners] didn't." Lunt said. "We saw our fully booked evenings though March and April 2020 cancelled overnight. They simply fell off a cliff."

But since then, the clientele has changed. Lunt said that while "a 70-person booking from Chinese tour companies was nice to have", now the restaurant relied much more on "businessmen and regular local customers".

"And now, we are quite busy again," Lunt added.

Not only are businesses adapting to this new normal but, whisper it, many Japanese say they prefer it this way.

Tourism in Japan has seen plenty of booms and busts. The past 50 years have brought various waves - and stereotypes - from the globetrotting Americans of the 1970s to the nouveau riche Russians of the early 2000s to, most recently, the newly wealthy Chinese that have increasingly ventured to these shores since the mid-2010s.

Similar to how Hong Kong gained a reputation for being the first stop for well-heeled Japanese in the 1980s (a trend that took a blow when the Japanese asset bubble burst in early 1992), Japan had recently become the first port of call for outbound Chinese.

With only about one-tenth of Chinese owning a passport in 2019, the Japanese government was quick to catch on to the potential and the Ministry of Foreign Affairs (MoFA) began to streamline visa approvals and allow thousands in at a time in large tour groups - mostly on cruise ships. According to the Japan Tourism Agency, 9.6 million Chinese people visited Japan in 2019, a tenfold increase since 2007 when 940,000 arrived, with the sharpest rise from 2014.

Along with this influx of visitors came boom times for restaurants and shops catering to tourists. So noticeable was the trend that the term "bakugai" was coined to refer to the binge-buying by Chinese tourists at souvenir stores. Some such stores even opened in Ginza, an area known for its posh boutiques and which commands some of the world's highest retail rents.

Japan's regional cities were relentlessly mobbed, causing considerable distress in usually tranquil locations such as Kyoto - where the residents are notoriously insular, even towards other Japanese.

"The tourists were too much. And when the gaijin [foreigners] try to take pictures of maiko [geisha] and chase them in their back yards although it's banned, this is not acceptable" said Eiko Sasaki, tea ceremony teacher and long term resident of Kyoto.

At its peak, Kyoto, which has about the same resident population as Barcelona at about 1.5 million, saw 53.5 million visitors a year, of which 1.15 million were from China. That compares to 12 million visitors to the largest city in Catalonia.

Kyoto's tourists were a broad mix comprising mainland Chinese, Taiwanese, Hongkongers, South Koreans and increasing numbers of Westerners and other visitors from far-flung corners of the globe.

But just as Barcelona underwent a backlash in which the local population began fighting back against the rise of tourism, so too did the residents of Kyoto begin to register their increasing discontent, with tourists outnumbering them thirty to one and blamed for booking all the nice restaurants, soaking up the supply of rental apartments and interfering with daily work routines. Local media reported tourists stopping geisha on the way to work to steal hair decorations, and carving names on sacrosanct bamboo groves, trying the patience of the city's residents.

Complaints flooded in to local Kyoto politicians and to the MoFA. And even though Japanese businesses around the country took the tourists' money, for many it was through gritted teeth.

In the run-up to the mayoral election in January 2020, all three candidates focused on dealing with overtourism as core policies citing Kyoto residents' issues of being unable to get on overcrowded buses, problems with the supply of private lodgings and the lack of "proper manners" of the visitors.

About four years after the boom started, it took the coronavirus to bring it all to a screeching halt. Retail businesses which had expanded fast to sell tat to tourists retreated just as quickly back to where they came from, as the 1.3 trillion yen spending by tourists in Kyoto at its peak, with foreigners accounting for 372.5 million yen, vaporised.

Will tourists come back in such force again? It seems unlikely to be soon, following a new report on China's outbound tourism by China Tourism Academy, part of the Ministry of Culture and Tourism, stating that 83 per cent of Chinese citizens would only travel to countries with zero new Covid cases and 82 per cent saying they would prefer to travel domestically rather than overseas.

And is the Japanese tourist industry desperately waiting for them? Perhaps not as much as might be expected, as domestic tourism is on the rebound as the government's "GoTo" tourism promotions restart as domestic Covid infections decline.

After dealing with the bakugai hangover, the Japan Tourist Bureau is once again in the black, logging a net profit of 6,733 million yen for April-September 2021, a turnaround from a net loss of 78,172 million yen a year before. Japanese tourists have money to spend too, having not really ventured out much in the past two years. And they are known for preferring peace, quiet and their own company.

Just down the road from the Shin-Hinomoto fish restaurant in Ginza is the flagship store of BIC Camera, which moved vast quantities of rice cookers, electronics, cosmetics, drugs and, believe it or not, baby nappies during those tourism boom years.

Now it is again humming gently, with customers masked up and speaking quietly. It is possibly the only place to find a travel SIM card in town today, though there aren't many to choose from; only two when there used to be a rackful.

Asked what she thought about the lack of Chinese tourists in the store, or any foreigners for that matter, a saleswoman in the store gently leaned over and whispered through her mask, "Well, it is certainly is a lot more peaceful in here."

This article originally appeared on the South China Morning Post (SCMP).

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