Japanese Market

Japan's Inbound Tourism Boom: 37 Million Visitors and What It Means for Cross-Border Business

Japan's inbound tourism market has staged one of the most dramatic recoveries in global travel history. After two years of near-zero international arrivals during the pandemic, foreign visitor numbers haven't just recovered — they've surpassed pre-COVID levels and show no signs of slowing down. For businesses selling products and services to the Japanese market, this surge creates opportunities that extend far beyond tourism itself.

This article examines the data behind Japan's inbound boom, what it means for cross-border commerce, and why the numbers matter for any company considering Japan market entry.

The Recovery: From Zero to Record-Breaking

According to the Japan National Tourism Organization (JNTO), international visitor arrivals to Japan have followed a remarkable trajectory:

2019 (pre-COVID): 31.9 million visitors — a record at the time
2020: 4.1 million (down 87%, borders effectively closed from April)
2021: 0.25 million (borders remained largely closed)
2022: 3.8 million (borders reopened October 11, individual tourism resumed)
2023: 25.1 million (rapid recovery, approaching 2019 levels)
2024: 36.9 million (surpassing 2019 by 16%)
2025 (projected): 40+ million (on track for another record)

Source: Japan National Tourism Organization (JNTO) — https://www.jnto.go.jp/statistics/data/visitors-statistics/

The Japanese government's target of 60 million annual visitors by 2030 — once considered ambitious — now looks increasingly achievable.

International Flight Recovery: The METI Analysis

A July 2025 analysis by Japan's Ministry of Economy, Trade and Industry (METI) examined the recovery of international aviation passenger services using the Tertiary Industry Activity Index. The findings are striking:

International aviation passenger services experienced the deepest decline of any transport sector during COVID, remaining suppressed for over two years
Recovery began in March 2022 with partial entry relaxation, accelerated in June 2022 when tourist visas resumed, and gained further momentum in May 2023 when vaccination and testing requirements were dropped
By late 2024, the international aviation index had largely returned to pre-COVID levels — driven almost entirely by inbound foreign visitors rather than outbound Japanese travelers

Source: Ministry of Economy, Trade and Industry (METI), Economic Analysis Office — https://www.meti.go.jp/statistics/toppage/report/minikaisetsu/hitokoto_kako/20250715hitokoto.html

Airport Usage Patterns Reveal Market Geography

The METI analysis revealed an important geographic insight: Japanese travelers and foreign visitors use different airports.

Japanese travelers: Haneda Airport is the top choice (32.8%), reflecting the concentration of Japan's population in the Greater Tokyo area and Haneda's convenient city-center location
Foreign visitors: Narita Airport leads, followed by Kansai International Airport, then Haneda. This reflects the dominance of international long-haul carriers at Narita and the popularity of the Osaka-Kyoto-Kobe region as a tourist destination

The three major airports — Narita, Kansai, and Haneda — account for over 70% of all international arrivals and departures. This geographic concentration has implications for logistics, retail, and service businesses targeting international visitors.

The Asymmetry: Inbound Surges While Outbound Lags

Perhaps the most significant finding from the METI analysis is the asymmetry between inbound and outbound travel:

Foreign visitors to Japan: Have exceeded pre-COVID numbers significantly
Japanese travelers abroad: Remain well below 2019 levels. Only about 748 million Japanese traveled abroad in 2024, compared to 11.8 million in 2019 (approximately 63% recovery)

The yen's depreciation against major currencies since 2022 has made overseas travel more expensive for Japanese citizens while simultaneously making Japan exceptionally affordable for foreign visitors. This currency dynamic is a major driver of the inbound boom — and it creates a favorable environment for foreign companies selling into the Japanese market at competitive international prices.

Source: Japan Tourism Agency, Travel and Tourism Consumption Trend Survey — https://www.mlit.go.jp/kankocho/siryou/toukei/shouhidoukou.html

Where the Money Goes: Tourism Spending Breakdown

Tourist spending in Japan reached ¥7.95 trillion in 2025, according to the Japan Tourism Agency. The spending breakdown reveals where opportunities lie:

Accommodation: approximately 28%
Shopping: approximately 26% (¥2.07 trillion)
Food and beverage: approximately 22%
Transportation: approximately 11%
Entertainment and activities: approximately 13%

Shopping at 26% is remarkable — it means foreign visitors spent over ¥2 trillion on purchases in Japan in a single year. This is higher than the shopping share in most comparable tourism markets and reflects Japan's unique position as a destination where people come specifically to buy things.

Source: Japan Tourism Agency, Consumption Trend Survey for Foreigners Visiting Japan — https://www.mlit.go.jp/kankocho/siryou/toukei/syouhityousa.html

Spending by Country of Origin

Not all visitors spend equally. The top spending nationalities reveal important market segments:

China: Highest total spending, driven by luxury goods, cosmetics, and electronics purchases. Average spend per visitor remains the highest among major source markets.
South Korea: Largest visitor numbers but lower per-capita spending. High frequency of repeat visits suggests strong ongoing demand for Japanese products.
Taiwan: Consistently high per-capita spending, particularly on food products and cosmetics.
United States: Growing visitor numbers with high spending on experiences and accommodation. American visitors tend to stay longer and spend more on food and activities than Asian visitors.
Southeast Asia (Thailand, Vietnam, Philippines, Indonesia): Fastest-growing segment with rapidly increasing spending power.

From Tourists to Cross-Border Customers

Here's why these tourism numbers matter for cross-border e-commerce: tourists who discover Japanese products during their trips become repeat purchasers after they return home.

The customer journey looks like this:

Discovery: Tourist visits Japan, encounters products not available in their home country
Purchase: Buys products during the trip — skincare, snacks, electronics, fashion
Depletion: Returns home, uses up purchased products, wants more
Cross-border search: Looks for Japanese products online — Amazon Japan, Rakuten Global, specialty importers
Repeat purchase: Becomes a regular cross-border customer

This pipeline is well-documented. iHerb's massive Japanese customer base was built partly by Japanese travelers who discovered American supplements abroad and wanted to continue purchasing them. The same dynamic works in reverse: a Korean tourist who discovers Japanese sunscreen at a Tokyo Matsumoto Kiyoshi becomes a regular cross-border buyer of Japanese cosmetics.

With 37+ million visitors annually, Japan is generating millions of potential cross-border customers every year. The question for businesses is whether they're positioned to capture that demand when tourists return home.

The Government's 60 Million Target: What It Means for Business

The Japanese government's goal of 60 million annual visitors by 2030 isn't just an aspirational number. It's driving real infrastructure investment:

Airport expansion: Narita and Kansai airports are expanding capacity. New international routes are being added from secondary airports.
Accommodation: Hotel construction has boomed, with international chains and domestic operators adding tens of thousands of rooms.
Payment infrastructure: Contactless payment, multi-currency support, and tax-free shopping systems are being upgraded nationwide.
Multilingual services: Government-funded programs are improving English and Chinese language support in retail, transportation, and hospitality.
Regional dispersal: Active promotion of destinations beyond Tokyo, Osaka, and Kyoto to distribute tourist spending across the country.

Source: Prime Minister's Office, Tourism Vision Realization Council — https://www.kantei.go.jp/jp/singi/kanko_vision/

For foreign businesses, this infrastructure buildout means that selling to Japan is getting easier. Better payment systems, more English-speaking support, improved logistics to regional areas — all reduce the friction of serving Japanese customers.

The Weak Yen Factor

The yen's depreciation since 2022 has been one of the most significant macro factors driving Japan's inbound boom. For foreign visitors, Japan has become remarkably affordable:

A quality hotel room that costs $300/night equivalent in New York or London can be had for $150 in Tokyo
A Michelin-starred meal that costs €200 in Paris costs ¥15,000 (approximately $100) in Tokyo
Japanese products that were price-competitive internationally are now genuinely cheap for visitors from strong-currency countries

This currency advantage has a dual effect for foreign businesses selling into Japan:

For foreign companies selling to Japanese consumers: Your products become relatively more expensive in yen terms, requiring careful pricing strategy
For foreign companies sourcing from Japan: Japanese products are cheaper to procure, improving margins for cross-border resale

Understanding the currency dynamic is essential for any Japan market entry strategy.

Compliance Considerations for the Inbound Market

Whether you're selling products to tourists in Japan, operating a cross-border e-commerce business serving former visitors, or building services for the inbound tourism industry, compliance requirements apply:

Tax-free shopping: Retailers serving foreign tourists can offer tax-free (consumption tax exempt) purchases, but must register with tax authorities and follow specific documentation procedures
JCT obligations: Foreign companies generating revenue in Japan — whether from product sales, digital services, or business services — may have JCT registration and filing obligations
Import compliance: Products imported for sale to tourists or shipped cross-border to former visitors must comply with Japanese customs, safety, and labeling regulations

At OPTI, we provide JCT Fiscal Representative (納税管理人) and ACP (Attorney for Customs Procedure) services to help foreign businesses navigate these requirements. Whether you're entering the Japanese market to serve the inbound tourism wave or building a cross-border business on the demand it creates, proper tax and customs compliance is the foundation.

To learn more about our services, visit OPTI's ACP Service Page.