Status of Hokkaido Tourism

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1 Status of Tourism Bureau of Tourism, Depart of Economic Affairs October 14, 2014

2 Status and Challenges of Tourism 1. Change in the number of inbound tourists Record high numbers of inbound tourists and foreign tourists to The number of inbound tourists (actual numbers) decreased in due primarily to the 2011 Great East Japan Earthquake and Tsunami; however, demand for tourism was back on the track to recovery in FY 2012 and demand for tourism, both from Japan and overseas, continued to recover in FY 2013 due to gradual economic recovery, attracting 53.1 million tourists (up 4.2% from the previous year). The number is a record high, surpassing million tourists in FY 2009 (though calculation methods differed between FY 2009 and FY 2013). Although the number of foreign tourists to has been on the rise, the number decreased in. However, the number of foreign tourists to has been recovering due primarily to the start of new international regular flight services and the depreciation of the yen in FY 2012, as well as easier procedures to obtain visas for tourists from South Asian countries and an increase in international regular flights in FY In that fiscal year, the number of foreign tourists to reached 1,153,100 (up 45.9% from the previous year), a record high, which means that the number surpassed 1 million for the first time in a fiscal year and accounted for approximately 10% of the total foreign tourists to Japan (10.98 million). Tourists from and elsewhere in Japan (10,000 people) Change in the number of inbound tourists (actual number) Foreign tourists (10,000 people) Tourists from elsewhere in Japan Tourists from elsewhere in Japan Foreign tourists Foreign tourists Tourists from Tourists from Note: A new survey method was adopted in FY Survey on the Number of Inbound Tourists in Tourism (FY)

3 Strongly emerging Asian region The number of foreign tourists to by country/region indicates that tourists from are the largest, followed by those form, South Korea, Hong Kong and in this order. Tourists from reached a record high in FY 2013 due to better access to local airports through international regular and chartered flights and tourists from increased 167% from the previous year due to easier procedures for visa requirements and the increase of direct flights to Number of foreign tourists to (by country/region) FY 2009 FY 2010 S. Korea S. Korea Hong Kong Hong Kong South Korea Hong Kong Hong Kong S. Korea Hong Kong FY 2012 S. Korea S. Korea Hong Kong (unit: people) Note: A new survey method was adopted in FY Survey on the Number of Inbound Tourists in Tourism Concentration of tourists in summer Approximately half of the total yearly inbound tourists ( million) come to in summer (June to September) and this number of tourists accounts for about 20% of the total. Meanwhile, the number of foreign tourists to indicates that there are two peaks one in summer and the other in winter. 10,000 people (total) Number of tourists to by season, etc. (total number) 10,000 people (staying; foreigners) June to Sept mil. Dec. to Mar mil. (staying) June to Sept mil. (staying) Total Foreigners Dec. to Mar mil. Apr. May June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Survey on the Number of Inbound Tourists in Tourism (FY 2013)

4 2. Trends of Tourists Attributes of tourists to Concerning the number of tourists to, men and women account for 47.5% and 52.5% (5% larger than men), respectively. In terms of age, 50 s or older accounts for 45.4% (almost half). In terms of residential area, tourists from Kanto account for 46.8%, much more than any other area. By gender Male Female By age 10 s 20 s 30 s 40 s 50 s 60 s 70 s By residential area Tohoku Kanto Tokai Hokuriku/Koshinetsu Kinki Chugoku/Shikoku Kyushu/Okinawa FY2011 Survey on the Trends and Satisfaction of Tourists Family trips account for the largest share In terms of the types of trips, family trips account for 56.8% (the largest share) and the share of group trips account for 27.2%, indicating a decreasing trend. Solo trips account for 13.5%, indicating a slight increase. Change in the types of trips (tourists to ) Married couple With children With other family/families (e.g., relatives) (With friends/colleagues, for business, etc.) Family trip (inc. honeymoons in 2002 and 2007 Group trip Solo trip *The 2011 Survey was compiled based on valid responses only; therefore, and 2007 survey data were recompiled using valid responses (excluding unknown ). FY2011 Survey on the Trends and Satisfaction of Tourists

5 Increase of extended stay tourists In terms of the itinerary of tourists to, they stayed for a shorter time in than previous years. However, extended stay tourists increased in, indicating that four days and three nights account for 27.0%, five days and four nights for 12.0%, and six days and five nights or longer for 16.7%. Itinerary (tourists to ) Day trip Overnight Three days and two nights Four days and three nights Five days and four nights Six days and five nights or longer *The 2011 Survey was compiled based on valid responses only; therefore, and 2007 survey data were recompiled using valid responses (excluding unknown ). FY2011 Survey on the Trends and Satisfaction of Tourists Repeaters account for 80% Concerning the number of tourists to, repeaters, regular tourists who visited the prefecture in the past, accounted for more than 80%. fans, who visited 5 times or more, accounted for more than 40%. Frequency of trips to First time 2 to 4 times 5 times or more *The 2011 Survey was compiled based on valid responses only; therefore, and 2007 survey data were recompiled using valid responses (excluding unknown ). FY2011 Survey on the Trends and Satisfaction of Tourists

6 Diversified purposes of trips The purposes of trips to are diversified (e.g., nature appreciation, hot springs/recreation, shopping/drinking and eating, theme/amusement parks), and the ratios of these categories differ from year to year. The 2013 Trends of Tourists, which was compiled by the Japan Travel Bureau, indicates that ranks top in the categories of nature appreciation (looking around nature and scenic spots) and dining trips (eating delicious food), leaving other areas far behind as the favorable destination. Nature and food are believed to continue to attract tourists as the major factors of their preference. Change in the purposes of trips (tourists to ) Nature appreciation Hot springs/recreation Specialty shopping/ drinking and eating Theme/amusement parks Participation in or observation of events Participation in or observation of sport and cultural activities Driving Participation in or observation of sport and cultural activities FY2011 Survey on the Trends and Satisfaction of Tourists Destinations to which you would like to go according to tour types Overall Okinawa Kyoto Tokyo Kagoshima Tokyo Hyogo Kanagawa Toyama Tokushima Nature appreciation Hot springs Zoos/aquariums Oita Okinawa Okinawa Kanagawa Kyoto Gunma Osaka Kumamoto Shizuoka Tokyo Kagoshima Wakayama Dining Skiing Flower appreciation Kyoto Wakayama Nagano Nara Akita Niigata Canada Switzerland Wakayama Iwate Kumamoto Hidden scenic spots World heritages (domestic) Long stay Latin America Kagoshima U.S. (continental) Peru Kyoto Okinawa U.K. Nagano Appreciation of nature phenomena Canada U.S. (continental) Kagoshima 2013 Trends of Tourists, Japan Travel Bureau (JTB)

7 Decrease in the users of package tours Tourists who used package tours with designated routes decreased by half, 39.4% in, to 19.8% in. Meanwhile, tourists who did not use package tours increased to 45.3% in. Use of package tours (tourists to ) Package tour (designated route trip) Package tour (with free plans, etc.) Non-package tour *The 2011 Survey was compiled based on valid responses only; therefore, and 2007 survey data were recompiled using valid responses (excluding unknown ). Survey on the Trends and Satisfaction of Tourists Change in means of travel The share of sightseeing (chartered) buses decreased by about half, 21.0% in, from 41.5% in in the category of the major means of travel. Meanwhile, the share of railroads accounted for a record high 29.3% in, indicating a change in the means of travel reflecting an increase in trips with a small number of participants. Major means of travel (tourists to ) Railroad Sightseeing bus Route bus Rental car Taxi Private car Motorcycle and others *The 2011 Survey was compiled based on valid responses only; therefore, and 2007 survey data were recompiled using valid responses (excluding unknown ). Survey on the Trends and Satisfaction of Tourists

8 More frequently used trip arrangement methods using the Internet Trip arrangement methods using the Internet account for more than 50% in the categories of young age (10 s to 20 s) and middle age (30 s to 50 s), as well as more than 40% in the senior age (60 s or older) category. The fact indicates that the use of the Internet has become more important. Accommodation arrangement (tourists to ) Young age (10 s to 20 s) Middle age (30 s to 50 s) Senior age (60 s or older) Site for booking trips Site of the accommodation Site of travel agency Telephone Other methods No advance arrangement Survey on the Trends and Satisfaction of Tourists The Internet has become more important as a source of information on trips The share of the Internet greatly increased as a source of information on trips from 10.1% in to 27.2% in. Meanwhile, the share of travel agencies decreased from 32.4% to 13.5% during that period. Source of information on trips (tourists to ) Travel agency Travel magazine Guidebooks (pamphlets) Internet (mobile phone) *A maximum of three options and two options were selected in the Survey and the to 2007 surveys, respectively. Therefore, the percentages of the responses are re-calculated using the total responses as the parameter. Survey on the Trends and Satisfaction of Tourists

9 Unit tourism consumption In terms of the amount spent by a tourist per trip, tourists from spent 13,271, tourists from elsewhere in Japan spent 69,670, and foreign tourists to spent 122,128. Tourism consumption (yen) Tourist from (per capita) Tourists from elsewhere in Japan (per capita) Foreign tourist (per capita) Survey period 1st survey: Oct to Sept nd survey: Oct to Sept rd survey: Jan to Dec th Survey: July 2004 to June th survey: July 2009 to June st survey 2nd survey 3rd survey 4th survey 5th survey Survey on the Economic Effects of the Tourism Industry in Note: For tourists from in the 1st to 4th surveys consumption value per household was adopted. The 5th survey used a different estimation method from the estimation methods for the 1st to 4th surveys

10 3. Status of the Tourism Industry Lodging industry As of March 2014, the number of hotels, Japanese inns and common lodging houses in certified by the Inns and Hotels Act is 4,808. A statistic survey on trips with accommodations conducted by the Japan Tourism Agency indicates that the number of accommodation facilities with 10 or more employees is 652 (as of January 2014). This means that more than 80% of accommodation facilities are small ones with 9 or fewer employees. In comparison with the FY 2008 survey, hotels increased by 3.2% in the number of facilities and 7.0% in terms of capacity; Japanese inns decreased by 12.7% and 11.5%, respectively. In total, hotels and Japanese inns decreased by 2.2% and 3.5%, respectively. Change in the number of accommodation facilities and capacity of guests (Unit: facility, person, guest night) Hotel In urban areas Japanese inn In urban areas Common lodging houses In urban areas Total Category In urban areas FY 2008 FY 2009 FY 2010 FY 2012 FY 2013 FY 2013/08 *1 Urban areas: 7 cities (Sapporo, Otaru, Hakodate, Asahikawa, Abashiri, Obihiro and Kushiro) *2 FY: as of end of March Food Sanitation Division, Bureau of Health and Safety, Department of Health and Welfare, Travel agencies The number of register travel agencies that have principal offices in is 304 as of the end of March 2014, slightly increasing from the previous fiscal year. Travel agencies that have principal offices in Reg. category Class I Class II Class III Area-based Agency Reg. agency Range of business FY 2012 FY 2013 Director-General, Japan Travel Agency Governor Governor Governor Governor Agent-organized trips in Japan and overseas Tailor-made trips in Japan and overseas Arranged trips Sale by agent based on outsourcing agreement Agent-organized trips in Japan Tailor-made trips in Japan and overseas Arranged trips Sale by agent based on outsourcing agreement Agent-organized trips in Japan (area-based) Tailor-made trips in Japan and overseas Arranged trips Sale by agent based on outsourcing agreement Agent-organized trips in Japan (area-based) Tailor-made trips in Japan (area-based) Arranged trips (area-based) Sale by agent based on outsourcing agreement Sale by agent based on outsourcing agreement Total *FY: as of end of March *Area-based travel business has been implemented since FY District Transport Bureau (MLIT)/Tourism Bureau, Department of Economic Affairs, Government

11 Passenger transport industry In comparison with, the number of passengers transported inside decreased in FY 2012 for all means of transport except JR (slight increase). The number of passengers transported between and elsewhere in Japan decreased for JR, ships and vessels, and airlines. The results of air transport by major airports in shows that the number of passengers transported between and Tokyo had decreased in the past several years, but the number has increased since FY Change in passengers transported by means of transportation (in ) JR Railroad/track Automobile Ship and vessel Airline Total FY 2008 FY 2009 FY 2010 FY 2012 (1,000 people) 2012/2007 Change in passengers transported by means of transportation (between and elsewhere in Japan) (1,000 people) FY 2008 FY 2009 FY 2010 FY /2007 JR Ship and vessel Airline Total Transportation in numbers in ( District Transport Bureau) (people) Change in transportation by airplanes (major airports in Tokyo No. of passengers transported No. of seats provided Seat occupancy rate (FY) Annual Statistic Report of Air Transportation, Ministry *Major airports: New Chitose, Kushiro, Hakodate, Asahikawa, Memambetsu and Obihiro of Land, Infrastructure, Transport and Tourism Status of chartered buses In comparison with, the number of bus service operators remained almost the same in FY 2012, but the number of vehicles, travel distance and the number of passengers decreased by 6.2%, 20.0% and 8.3%, respectively, over that period Business results by chartered bus No of operators No of vehicles Travel distance No. of passengers (vehicle, 1,000 km, 1,000 people) FY 2008 FY 2009 FY 2010 FY /2007 Transportation numbers in ( District Transport Bureau)

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