China’s new visa policies and tax refund reforms are having a transformative impact on international travel and retail in Shanghai, according to a recent report by Savills. The city has seen a remarkable increase in international arrivals and shopper engagement, driven by enhanced accessibility and an appealing cultural landscape.
Since December 2023, China has opened its doors wider, implementing visa-free entry for citizens from 43 countries and extending transit periods to 240 hours for 54 others. These changes have led to an impressive 2.6 million international arrivals in Shanghai during the first trimester of 2025—marking a 37.1% year-on-year increase. Notably, visitor numbers surpassed pre-COVID levels in both December 2024 and April 2025, signaling a vibrant revival of tourism.
This influx has not only extended tourists’ stays but has also sparked a shopping spree in the city. Leveraging its well-developed infrastructure, affordable flight options, and rich cultural offerings, Shanghai has positioned itself as a prime destination for both leisure and business travelers alike.
In April, the government took additional steps to encourage spending by lowering the minimum tax refund threshold to $28 (RMB200) and significantly increasing the annual reimbursement cap to $2,785 (RMB20,000). More stores and malls are now included, with visitors able to claim an immediate 11% refund at over 3,300 participating tax refund outlets, including major shopping havens along East and West Nanjing Road, Xujiahui, and Zhuyuan.
The impact of these reforms has been palpable. During the Labour Day holiday in 2025, inbound tourist spending soared to $63.39 million (RMB455 million), an astonishing 211.6% increase compared to the previous year.
Retailers are eager to capitalize on this growth, adopting high-quality, immersive experiences to meet the evolving needs of consumers. Visitors are increasingly drawn to Chinese brands, shopping fervently for fashion, designer bags, themed toys, and food—reflecting a diverse and vibrant retail landscape.
South Korea, Japan, and Thailand emerged as the top three origin countries for tourists in Q1 2025, with notable increases in visitors from Thailand (+242.75%), South Korea (+142.37%), and Indonesia (+118.51%). The profile of these travelers is skewing younger; approximately 40% of incoming tourists are between the ages of 20 and 35, according to Mastercard.
These “digital natives” are not just wandering the aisles; they’re active on social media throughout their shopping journeys, making seamless online-to-offline engagement crucial for brands seeking to connect with them meaningfully.
Brands such as SHUSHU/TONG and Songmont report that nearly half of their clientele now consists of international visitors. Meanwhile, brands like Pop Mart and Miniso are capitalizing on trendy IP partnerships and social media buzz to attract attention and drive sales.
The dining scene is also thriving, with restaurants like Haidilao and Long Time Ago experiencing higher foot traffic from foreign patrons than locals during peak hours. To cater to this diverse clientele, many establishments have introduced multilingual menus and AI translation tools, ensuring that no one is lost in translation, or worse, in flavor.
Despite this positive momentum, some caution remains as consumer sentiment is tempered by broader economic uncertainties, with value-for-money becoming a deciding factor for many shoppers.
Nonetheless, the marketplace is energized by emerging brands, particularly in sectors like outdoor apparel, pet services, and global bistros. Additionally, themed malls focusing on ACG (anime, comics, games) culture and immersive experiences are rapidly gaining popularity among niche audiences.
As major attractions such as Lego and Harry Potter theme parks loom on the horizon, expectations are high for these developments to further enhance Shanghai’s reputation and stimulate cross-sector consumption in retail, hospitality, and tourism.
How have China’s visa policies impacted tourism in Shanghai?
China’s recent visa-free entry policies have resulted in a significant rise in international arrivals, with 2.6 million tourists flocking to Shanghai in just the first four months of 2025—a 37.1% increase from the previous year.
What measures have been taken to encourage foreign spending in Shanghai?
In April, the government lowered the minimum tax refund threshold to $28 and doubled the annual cap to $2,785. This allows more tourists to enjoy immediate tax refunds at over 3,300 designated stores, driving a substantial increase in visitor spending.
Which demographics are primarily driving tourism in Shanghai?
Younger travelers, particularly those aged 20 to 35, make up about 40% of all inbound visitors. This group tends to engage heavily with social media, making their shopping experiences intertwined with digital interactions.
