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Cheap yen and airfare spark foreign tourism boom in Japan

Kirk Spitzer
USA TODAY

SAPPORO, Japan — Shannon Vogrig and Eloise Thomas were midway through a two-week ski vacation this month  when they took a break to do some shopping and sightseeing.

Shannon Vogrig, 24, a graphics designer, and Eloise Thomas, 25, a paramedic, both of Melbourne, Australia, take a break during a ski vacation in Sapporo, Japan, in January 2016.

It was the Australian couple’s second trip to Japan in just over a year, and they had only one complaint: too many foreign tourists.

“We’re trying to avoid other Australians, but it’s not easy,” Thomas said.

You can say that. Foreign visitors are flocking to Japan in record numbers, buoyed by a weak yen, budget airfares, relaxed visa requirements and pre-Olympics buzz.

Nearly 20 million foreigners visited Japan in 2015. That’s up nearly 50% from 2014, and more than double from a year earlier, according to the Japan National Tourism Organization.

The tourists include a flood of Americans: 1.03 million last year, up from 727,234 in 2010. “We love Japan,” said Beverly Smith-Killing, an artist and writer from Minnesota who has visited Japan with her husband several times in recent years. “The onsens (hot springs), the food and people. Learning the language and the culture. Japan has a lot offer.”

This was the third straight year of record growth in foreign arrivals, and there appears to be no end in sight. An estimated 1.85 million visitors traveled to Japan in January,  up 52% from the same month a year earlier — the second-highest monthly total on record.

At this rate, foreign arrivals in 2016 will easily surpass the target set two years ago by Prime Minister Shinzo Abe's administration of 20 million visitors annually. That’s four years ahead of the original target of 2020, when Tokyo will host the Summer Olympics.

Spending is at record levels, as well, providing a vital boost for Japan’s long-stagnant economy.

Japan’s Finance Ministry reported this month that foreign visitors spent about $27 billion last year — up 71% over 2014.

“Tourism is now supporting the Japanese economy at a scale comparable to exports of semiconductors and other electronic components, and automobile components,” the Nihon Keizai economic journal recently noted.

Much of the increase in visitors and spending is from China, despite frosty diplomatic relations.

Tourists from China reached 4.99 million last year and now account for one out of four visitors from overseas. The Chinese also spend heavily — 40% of the total.

It’s not unusual to see Chinese visitors in major shopping districts such as Ginza or Akihabara dropping thousands of dollars — in cash — on clothes, jewelry and appliances like rice cookers, air conditioners and high-tech Japanese toilets. It’s even inspired a new phrase in Japanese: bakugai, or “explosive shopping.”

“Chinese visitors are an increasingly important market since they spend so much money. You see them in stores everywhere,” Sapporo Mayor Katsuhiro Akimoto said.

Foreign tourists pose for a photo in front of an ice sculpture at the Sapporo Snow Festival in Sapporo, Japan, pm Feb. 5, 2016.

Sapporo is a major winter destination, with dozens of nearby ski resorts and an annual Winter Festival that draws 2.4 million visitors per year, including a quarter-million from overseas. Many arrive on charter flights from China, South Korea and Australia, and officials are looking to expand air connections throughout the Asia-Pacific region.

“Our growth is coming not just from China or other traditional markets,” Akimoto said. “We have many visitors from Southeast Asia who have never seen snow, so this is a nice place for them to come and bring the family. Many people come here for second or third visits. Right now we are looking to arrange more direct flights from overseas and that will help, too.”

Much of the increase in tourists is because of the falling yen, which has made Japan a cheaper destination than in years past. The yen peaked at 76 per dollar in early 2012 but dropped steadily under the easy-money policies of Abe's government to stimulate growth. The yen fell to 124 per dollar last June, before strengthening somewhat in recent months.

The Abe administration also worked hard to ease some barriers to foreign tourism. Visa restrictions have been relaxed, particularly for those visiting from China and Southeast Asian countries, who were once largely restricted to organized tours.

An 8% sales tax was lifted on most items for overseas visitors. Tax-free spending by foreigners at 46 selected retail outlets surveyed recently by the Japan Department Stores Association nearly doubled from $42.2 million in September to $80.8 million in November.

In Tokyo, the local government plans to expand free Wi-Fi service — currently woeful by world standards — add English-language road signs and overhaul map symbols to make it easier for tourists to get around in the world’s largest city. (Example: The symbol for temples and shrines on many road maps and tourist publications closely resembles the Nazi swastika).

Even private and public baths are getting in the swim of things. At some facilities, foreigners are now exempt from a ban on bathers with tattoos — a measure designed to exclude yakuza gangsters but has resulted in some foreigners with more benign body art being turned away.

Vogrig and Thomas said they were eager to come back for a third trip to Japan.

“The snow is good. It’s affordable. The people are friendly. You can experience a different culture,” Vogrig said.

Assuming, of course, they can avoid other Australians.

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