The relationship between China-South Pacific island countries tourism and trade in the context of the Belt and Road Initiative

Abstract

In the context of the Belt & Road Initiative (BRI), China attaches great importance to tourism diplomacy with the South Pacific Island Countries (SPIC). The study of the relationship between tourism and trade is therefore of great significance for the further development of bilateral political and economic cooperation. This paper selected data on the inbound and outbound tourism, as well as import and export trade, between China and SPIC in the period 1998-2017, and used econometric methods to demonstrate the interconnections. The results show that there is a positive long-term equilibrium relationship between passenger flow and import and export trade of China and SPIC. Under the influence of policies, the interaction between inbound and outbound tourism and import and export trade is characterized by periodic fluctuations. China’s outbound tourism to SPIC plays a stronger role to import trade than to export trade. From the analysis of two sections, major events have a moderating effect on the proportion of SPIC tourists and trade dependence on SPIC, while both of the proportion of Chinese tourists and their trade dependence on China are on the rise, and these two have a pulling effect for each other.