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Welcome to sorts on the market. I'm Chen Leifen, Morgan Stanley's Hong Kong China Transportation Analyst. Today I'll share my thoughts on why travel is quickly emerging as one of key drivers of China's economic rebalancing. It's Tuesday, March 3rd at 2pm in Hong Kong. I've just gotten back from my Lunar New Year trip to mainland China with the longest Chinese New Year break in history. People were out roaming, exploring, laughing, and the whole country felt like it was buzzing with people on a mission to enjoy every minute. According to the Ministry of Culture and Tourism, total domestic tourism spending recorded a robust 19% year on year growth during the holiday. In fact, China's tourism industry isn't just rebounding after the pandemic, it's entering a structurally stronger phase supported by policy tailwinds, demographic shifts and a clear pivot toward experience driven consumption. By 2030, tourism revenue could reach RMB12 trillion, equal to roughly 1.7 trillion, implying 11% annual growth from the mid-2020s. Over the next five years, cumulative domestic and inbound revenue may approach RMB50 trillion or US dollars 7.2 trillion. That scale makes travel more than a cyclical recovery. It's becoming a core pillar of China's consumption led growth. We expect tourism's share of GDP to rise to about 6.7% by 2030, up from 4.8% in 2024. Domestic travel remains the backbone. People are not just traveling again, they are traveling more than before. Policy is reinforcing demand. Extended public holidays, new school breaks and event driven tourism are boosting activity. In 2025 alone, around 3,000 large scale performances attracted more than 43 million attendees and spending reflects that shift. Domestic tourism spending reached RMB 6.3 trillion in 2025, about 11% above pre Covid levels. Even with slightly lower spending per trip, more frequent travel is lifting overall revenue. International travel is emerging as a second growth engine. By 2030, inbound travel could represent 16% of total tourism revenue. In late 2025, inbound visitor growth in major cities was up about 30 to 50% year over year, supported by expanded visa free access, which now accounts for the majority of foreign arrivals. These visitors often stay longer and spend more. Outbound travel is strengthening too. International air traffic grew 22% in 2025, far outpacing domestic growth, and now contributes a meaningful of airline revenue. Demographics and technology are reinforcing the trend. Younger consumers prioritize travel, while older households with substantial savings are beginning to spend more as services improve. At the same time, smart hotels, virtual reality attractions and data driven operations are enhancing engagement and willingness to pay. This isn't just pent up demand, it's policy, demographics, technology and supply aligning at once with travel at the center of China's consumption. Story thanks for listening. If you enjoy the show, please leave us a review wherever you listen and share thoughts on the market with a friend or colleagues today.