Weak yen draws millions of tourists to Japan

Until now considered a destination within the reach of few, Japan attracts a record number of foreign tourists who, encouraged by the weakness of the and in in front of dollar or the eurothey do not hesitate to spend their money on kimonos, knives or luxury dinners.

“I bought three pairs of shoes, something I normally never do,” laughed Frenchwoman Katia Lelievre, 36, in the crowded Asakusa area of ​​Tokyo, famous for its Buddhist temple and souvenir shops.

They are shoes from Converse, Nike and Adidas brands that he could have found in Europe, but because of the exchange rate “it was really worth it” to buy, he explained.

The experience is similar for Dominique Stabile, a 31-year-old Italian who had already visited the country ago. “five or six years.” “I remember that prices were clearly higher than now, particularly for cosmetics and clothing,” he claimed.

“The food is really cheap”explained this tourist, who confesses to having spent a lot “especially on food.”

The depreciation of the yen, which fell to decade lows against the dollar and the euro on Monday, encourages tourist consumption to the delight of local merchants.

“Many people do the math and when they see the equivalent in their currency they say ‘gee, I’m going to buy that.’”said Saori Iida, an employee at a traditional Japanese clothing store. “Yesterday we had a person who bought 15 kimonos,” said.

“Thanks to the cheap yen, foreign customers are buying many handmade knives, even if the price increases”said Yuki Suzuki, 21, a shop assistant in a store specializing in these products.

“I feel that now there are more customers who want to buy something else, for example several knives made by the same craftsman,” he added.

A very reasonable ramen

In March, Japan received more than 3 million foreign tourists in a month for the first time. It’s a 11.6% more than in March 2019, before covid-19 hit tourism.

Furthermore, the per capita spending of these visitors increased 52% in the first three months of the year compared to 2019.

The phenomenon is difficult to explain without the variation in the exchange rate: in 2019, one dollar bought 112 yen. On Wednesday it was almost 158 ​​yen, the cheapest price in 34 years.

A bowl of ramen noodles costs around 1,000 yen, or US$6.3. In 2019 it was US$8.9. A 700,000 yen luxury watch or branded handbag is now US$4,430, down from US$6,250 five years ago.

Many stores exempt tourists from sales tax. 10% if they show the passport. The most wasteful per capita are Australians, followed by the British and the Spanish, according to the Japanese tourism agency.

Invasion

The depreciation of the yen is partly attributed to the Bank of Japan’s policy of maintaining ultra-low interest rates, contrary to other central banks that increase them.

Favorable for tourists, this phenomenon penalizes domestic consumption, which has been in decline since March 2023 due to inflation. The low yen makes imports more expensive and hurts purchasing power.

In addition, the invasion of tourists that saturate shops and restaurants generates discomfort among part of the local population.

The visitors “they get good value for their money”said Akiko Kohsaka, an economist at the Japan Research Institute and tourism expert.

“It may mean that tourists choose to stay in better hotels than they are used to, or stay an extra day in Japan, or buy brand-name items.”he told AFP.

“Even eating sandwiches or hamburgers, which they can get in their countries, they feel that they would not find that price at home,” Kohsaka added.

“I think that Japan can rely on itself as a tourist destination. Even if the yen trend reverses, I don’t think it will cause a drop in tourist spending.”

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