China expects tourism shift from U.S., Australia to Asia for Lunar New Year

BEIJING (Reuters) - China's aviation regulator said on Thursday it expected a decline in airline capacity and bookings to the United States and Australia over the Lunar New Year period for the first time in nearly four years due to a shift in tourist destinations.

Japan, Thailand and South Korea will rank among the most popular destinations for Chinese travellers for the holiday period early next year, Civil Aviation Authority of China (CAAC) official Yu Biao told reporters at a monthly briefing.

Reuters last month reported that Chinese airlines were adding seats on short- and mid-range Asian flights in a strategic shift away from prestigious but loss-making North American routes to a market that promises better returns and growth.

The nation's international aviation industry has been in the red for at least three years, with losses reaching 21.9 billion yuan ($3.11 billion) in 2018, according to recent China Air Transport Association data.

After a decade of double-digit growth, Chinese visitors to the United States fell last year, and the U.S. National Travel and Tourism office forecasts another 5% decline this year as a combination of a stronger dollar, China's cooling economy and trade tensions between Beijing and Washington take their toll.

(Reporting by Stella Qiu in Beijing and Jamie Freed in Sydney; Editing by Kim Coghill and Sherry Jacob-Phillips)