The annual report on local economy 2018, published by Cabinet Office of Japan, illustrates that inbound travel demand is inclined to particular local regions, particularly South Kanto region and Kinki region. In comparison between 2012 and 2017, international visitors concentrated on Tokyo, Osaka, Chiba and Kyoto, and at the same time local spending by them was bigger in the four prefectures than other regions. The same situation could be found in guest nights, as the demand was inclined to Tokyo, Hokkaido, Kyoto and Okinawa.
The ratio of international visitors in Tokyo, Osaka, Hokkaido, Kyoto and Okinawa (matured regions) accounted for 50% of the total in 2017, and the ratios of guest nights and local spending were 60% and 70%. The graph below illustrates the ratios of international visitors, guest nights and local spending in other 42 prefectures (potential growth regions) in total, and it shows the ratio of local spending had declined since 2014.
The report says that many international travelers tended to visit potential growth regions from matured regions as day trips and to purchase goods in matured regions rather than potential growth regions. A main purpose to visit potential growth regions is to experience unique things-to-do there, such as watching local sports, onsen or unique seasonal landscapes.
The report also forecasted that expansion of inbound travel demand would be boosted by the LCC network as well as economic growth, exchange rate and visa waiver, based on analyses of data in 36 countries and regions. If LCC flights into Japan increase by 10% a year, for instance, international visitors are expected to reach 32.5 million in 2018, 35 million in 2019 and 37.7 million in 2020, according to the report. If the growth rate is 20% a year, the inbound travel market will grow to 33.6 million in 2018, 37.6 million in 2019 and 42.1 million in 2020.