Invest2 publishers2 min readPublished
Heavier spending per visitor drives most of Seoul's 59.9% jump in foreign card payments
Seoul's foreign visitors charged 7.78 trillion won on cards from January to August, up 59.9%, while arrivals rose 21.6% to a record 11.56 million. Heavier spending per head produced close to two-thirds of the 2.91 trillion won gain, with shops and clinics taking most of the bill.
The Investor · Invest desk
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What happened
- Visitors from China, Japan and Taiwan made up 66.4% of August arrivals, with China sending 636,000, or 36.9%.
- Shopping took 46.6% of foreign card spending, followed by medical and wellness at 23.8%, food and beverage at 13.2% and accommodation at 10.4%.
- Foreign card spending at large shopping malls rose 77.5%, on medical tourism 64.2% and at restaurants 59.5%.
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Why it matters
- constraint Accommodation's 10.4% share limits how much of the surge reaches hotels, while clinics, at more than twice that share, are the second-largest recipient of tourist card money.
- exposure China sent more August visitors than Japan and Taiwan combined, so a slowdown from that one market would remove more spending than an equal slowdown from any other.
- decision Seoul's plan to keep tourists longer through nighttime programming goes after spending per visitor, the source of most of this year's gain.
Divide the card total by the head count and the average foreign visitor charged about 673,000 won in Seoul between January and August, against roughly 512,000 won a year earlier, a gain of about 31% per person [11][12][13]. At last year's rate per head, this year's 11.56 million arrivals would have charged about 5.92 trillion won [1][14]. They charged 7.78 trillion [2]. Of the 2.91 trillion won increase, extra visitors account for about 1.05 trillion and heavier spending per head for about 1.86 trillion, close to two-thirds [15][16].
Retailers get most of it. Shopping and medical and wellness services together took 70.4% of foreign card spending, and spending at large malls grew 17.6 percentage points faster than the card total [17][5][20][10]. Accommodation is the smallest of the four categories the city named, and medical and wellness took about 2.3 times its share [17][19]. For a hotel operator, the demand in these figures is thinner than the headline growth suggests. Korea JoongAng Daily dates the category mix to last year, while Yonhap reports the same percentages with no period attached, so this year's split is not settled [17][18].
Card totals count only card payments. A visitor who switched from cash to card adds to the 59.9% without buying anything more, and the per-head gain shrinks by whatever part of it is a change in how people pay [2]. The district figures carry a similar risk. Spending rose 240.1% near Dosan Park, 206.6% near Kyeongsu Elementary School in Seongsu-dong and 127.4% at Gwangjang Market, but the city published those growth rates without the won amounts behind them, and a small base produces large percentages easily [6]. The visitor base is also concentrated: China alone sent more August visitors than Japan and Taiwan combined [9].
I think the demand is real for Seoul's shops and clinics, on the evidence of mall and medical spending growing faster than the total [5]. The counter-case is that a good share of the 31% per-head rise is payment habits, in which case arrivals, up 23.3% in August, would carry most of the growth from here [3][13]. August's pace was 1.7 points above the year-to-date rate [8]. These are the city government's numbers for Seoul alone [1]. The thesis fails if full-year card spending per visitor slips back toward 512,000 won while arrivals keep climbing [12].
Cho Seong-ho, head of the Seoul Metropolitan Government's Tourism and Sports Bureau, said: "We will strengthen connections between nighttime content and local commercial districts, with a focus on Seoul's nighttime economy, so that tourists stay longer in Seoul and tourism spending spreads throughout the city." [7]
What to watch
- Seoul's September-to-December data, and whether card spending per visitor holds near 673,000 won or drifts back toward last year's 512,000 won.
- Chinese arrivals, 636,000 in August, since the largest market moves the total more than any other.
- Any city release giving won amounts for the fast-growing districts or a current-year category mix.