The current market situation and exit of COVID-19 (4)
General situation
It seems the second wave of infection had been calm down and the number of new cases confirmed are decreasing gradually. Tokyo metropolitan areas got sharp increase in late July, but it peaked out in the beginning of September. The restrictions on opening hour of the restaurants and bars are lifted on 15 of September and ceiling of audiences at the big sports event up to 5,000 changed to half of the venue capacity. While 100 % capacity can be used at silent events such as classic music concerts and movie theaters.
On the other hand, many are anxious about the possible third wave from late Autumn due to colder and dryer weather. Domestic media coverage on corona virus has been getting shorter and smaller and people seem to get used to the situation.
Amid this, former prime minister, Mr.Shinzo Abe stepped down due to health problems on 28th of August, which was surprising not only in general public, but also among politicians. Mr. Yoshihide Suga who had been right -hand man for Mr.Shinzo Abe for seven and half years, was appointed successor as 99th prime minister. At the moment, it seems main policy of Mr. Suga is to take over same policy as Mr.Abe.
Japanese business and lifestyle
Pandemic of Corona virus changed Japanese lifestyle and business styles in many aspects. I would like to pick up several prominent changings as follows:
- Remote Work
Remote work could be already common business behaviors in several countries, but Japan was far behind from them. However, forced remote work by lock down period opened eyes of many companies and 30% of them still continue remote work. People recognize Japanese type of packed commuting is waste of time and energy. Especially some IT companies terminate the office rent contract and office vacancy rate is going up in some areas.
- Workation
If workers don’t have to commute to the office, they have free to live anywhere. Some brave workers moved to local cities and country side to avoid crowded modern cities, which is also good to prevent Corona Virus.
As the result, popularity of flats in tower building in city center is going down and houses in the suburbs are taking attention by young families. Surprisingly the population in Tokyo decreased by 5903 in August.
- Micro Tourism
This is coined word by Japanese travel trade. People hesitate to travel to far destination due to fear to be infected by Corina Virus or they are not welcome by local people in the destination. New promotion idea for the first recovery is to recommend short distant travel, may be 1-2 hours driving by private cars as family or together with few friends. Instead of promoting to people in big cities or other countries, local clients will compensate for them. Naturally the contents of the services should be different, local foods are too common for local people, so fresh seafood in mountain area is a kind of specialty for new clients.
Tourism and travel industry
The situation of tourism business shows sharp contrast between domestic traveling and overseas traveling. Government Have implemented huge stimulus package for domestic traveling called “Go to Travel” campaign from 22 of July.
In this campaign, simply saying, half of traveling cost is covered by government.
35% as cash back and 15% as coupons available at restaurants and shopping during traveling. At the beginning, Tokyo area was excluded due to the situation of newly confirmed infections, but she will be included from 1 of October. Even without Tokyo, 6 million people used this campaign in last 2 months.
There was autumn holiday season last weekend between 19 to 22 of September, called Silver Week. In many destinations got more tourists than usual year and many flight were fully booked for the first time since March.
On the other hand, there is no light in the tunnel for overseas traveling. Still Japan closes boarder for many countries and 14 days quarantine Is needed after their traveling overseas countries. There are almost no package tours available in the market. Naturally some travel agencies temporary close down the office, lay-off staff and many staff working for overseas department are transferred to domestic traveling department in major agents.
Good news is that JATA organized Online Travel Mart in the middle of August and the beginning of September which was comprised of panel discussion by top management in major agencies, webinar by many tourist boards and workshop for three days. It was pretty good opportunity to show the presence of Japanese travel trade.
Japanese government will soon start discussion with Germany and France how to resume business trip and negotiation with Asian countries already going on, but opening of boarder without restriction looks faraway.