The Suspension of Flights to China by many countries

In today’s world, which countries are most popular? A look at the commercial planes flying overhead daily can give us a clue about the current international political dynamics. Recently, several foreign airlines have started suspending their flights to China, a development that has become big news both internationally and within China. However, most media outlets are analyzing this issue from the perspective of airline operating costs. This angle seems to suggest that as soon as airline costs decrease, foreign companies will immediately resume their operations to China.

However, operating costs are just a surface issue, while the real reason behind countries suspending flights to China is the obvious decline in China’s international importance. The number of foreign passengers airlines bring reflects the international community’s attitude toward a country. Therefore, when the number of international passengers to a country drops sharply, this mirrors a significant shift in how the world views that nation, indicating a drop in its global standing. As the "Chinese Dream" that has captivated the international community for over two decades ends, Beijing’s response has been to fire intercontinental missiles into the South Pacific, highlighting its strategic threats and expansionist ambitions.

1. Countries Suspending Flights to China

On August 19, a Chinese propaganda outlet based in Hong Kong, HK01, reported that several foreign airlines had suspended flights to China.

Since May this year, a number of countries have announced the cancellation of their China routes. Delta Airlines from the U.S., which was set to resume its Los Angeles–Shanghai route this fall, has now canceled it. Shortly after, the UK’s largest and second-largest airlines also announced the suspension of their flights to China. On August 8, British Airways declared that from October 26, 2023, to November 2025, it would suspend its London–Beijing route, with a decision on future services to be made later. British Airways had operated this route since 1980, but after 44 years, it’s now shutting it down. Virgin Atlantic, the second-largest UK airline, has taken an even firmer stance, suspending its China route indefinitely starting October 26.

Australia’s Qantas also announced it would suspend its Sydney–Shanghai route starting July 28. This route had only resumed nine months earlier and is now permanently canceled. Beginning October 27, Southeast Asia’s Royal Brunei Airlines will also suspend its twice-weekly flights to Beijing.

While continental European countries haven’t suspended their China routes, they’ve reduced the number of flights. This summer, Lufthansa operated 35 weekly flights from Munich and Frankfurt to Beijing, Shanghai, and Hong Kong, only two-thirds of its pre-pandemic schedule.

Despite being the peak travel season, when airlines worldwide are expanding operations to make up for three years of losses due to the pandemic, why have airlines from these countries suddenly suspended their China routes? Instead of reducing overall operations, they’ve redirected planes, pilots, and flight attendants to other routes. For instance, while Qantas stopped its China flights, it started a new route to Manila, Philippines, and increased flights to Singapore.

Some airlines, though still flying to China, have swapped their large planes for smaller ones with fewer seats. For example, Emirates has stopped using its Airbus A380 for China routes and now uses the smaller Boeing 777.

2. Fewer Passengers on China Routes

HK01 remarked on the phenomenon of countries suspending flights to China, saying, “This gives off a whiff of something abnormal.” But what exactly is that abnormality? The outlet dares not say. In truth, the abnormality is the noticeable decline in China’s international influence.

Five years ago, China was one of the hottest travel destinations globally, not only for business travelers but also for a steady stream of international tourists. This demonstrated the significant interest countries had in China, which naturally boosted China’s influence in the international community. However, after the COVID-19 pandemic erupted in China in 2019, sparking a global health crisis, flights to and from China came to a halt. Once the pandemic ended, international flights began to resume, but only one country saw a significant drop in flights—China.

In June this year, global international passenger numbers reached 5.35 million, a 112% increase compared to June 2022, but flights to China were still sparse. In July, flights between the U.S. and China were only 24% of what they were in July 2019, and the load factor on these flights was just one-fourth of what it was five years ago. Based on these figures, assuming that pre-pandemic flights between the U.S. and China were mostly full, the current monthly passenger volume has decreased by 93.7%, leaving only 6.3% of the pre-pandemic traffic. A significant portion of these remaining passengers are Chinese-Americans visiting family in China. Even during this summer vacation period, few of the hundreds of thousands of Chinese students in the U.S. returned home, fearing visa complications when reapplying for their student visas.

Among global China-bound routes, U.S.-China flights are the most telling. China’s most coveted destination is the U.S., as China relies on the U.S. market to earn foreign exchange through exports and to acquire technology from the West, often through dubious means. When nobody is flying the U.S.-China route, it signals that U.S.-China relations are nearing a freezing point. With a population of 1.4 billion, China should, in theory, have more flights than Taiwan, which has only 23.5 million people. However, U.S.-Taiwan flights are currently double those to China. In December last year, there were 143 weekly flights between Taiwan and North America, while China had only 70. In April this year, U.S. airlines collectively petitioned the U.S. Department of Transportation to halt the addition of flights between the U.S. and China. This reversal shows that business travelers and tourists from around the world have already voted with their feet, signaling their decision: "We’re no longer going to China."

If poor U.S.-China relations are reducing flights, what about China’s flights to other countries? In July this year, international flights departing from China were 23% lower than in the same period in 2019, and foreign tourists visiting China were only 30% of pre-pandemic levels.

3. European Flight Detours and Chinese Airspace Navigation Disruptions

The suspension of flights to China by various airlines is not due to orders from their foreign ministries but rather their own decision, driven by a lack of passengers. It’s not just that passengers flying to China have dropped by 70%; Chinese outbound travelers have also plummeted. One reason is financial, with fewer Chinese people able to afford international flights. Another reason is the government’s strict control over passport issuance, preventing many middle-class professionals, such as those in schools, hospitals, and media, from traveling abroad. To attract the limited customer base, Chinese airlines have slashed ticket prices, yet China’s four major state-owned airlines lost 7 billion yuan in the first half of this year. Despite these losses, Chinese airlines dare not suspend international routes because doing so would forfeit their right to those routes, which could then be taken over by foreign airlines.

The Russia-Ukraine war seems to have created an opportunity for China’s airlines on European routes. After Russia’s invasion of Ukraine, many countries imposed sanctions on Russia, and in retaliation, Russia closed its airspace to 36 countries, including the EU, the U.S., the UK, and Canada. Previously, flights from Europe to China passed through Russian airspace, but they now have to take longer detours through the Middle East, adding fuel, labor, and other costs. Since China is allied with Russia, its planes still have access to Russian airspace, allowing them to take shorter routes, giving Chinese airlines a price advantage over their Western counterparts.

However, with the recent escalation of the Russia-Ukraine war, including mutual drone strikes, airlines face new challenges. Russia uses its domestic GLONASS system with strong anti-jamming capabilities, while Ukraine’s drones rely on civilian GPS, which lacks such protection. As a result, Russian forces have been spoofing GPS signals to disrupt Ukrainian drone operations. This has frequently occurred on the battlefield.

The fake GPS signals used by the Russian military also interfere indiscriminately with the navigation and safety warning systems of civilian aircraft, creating new flight safety risks. According to SkAI Data Services and Zurich University of Applied Sciences, over 1,100 flights were affected daily by this interference as of August 2023. Since Chinese flights to Western Europe pass over the Russia-Ukraine conflict zone, they are at a much higher risk of encountering these navigation disruptions than airlines from other countries. Fortunately, no accidents have occurred due to this interference so far.

4. The Cut-off of U.S. Financial Investments

Over the past few years, the last remaining bond between the U.S. and China has been U.S. financial investments in China. The U.S. has injected $2 trillion into China’s financial markets in recent years. This money only temporarily delayed China’s economic collapse but caused significant losses for U.S. investors. Now, Wall Street’s willingness to invest in China has largely dried up.

When discussing foreign investment, most people focus on direct investment, such as building factories or opening businesses, known as "greenfield investment." However, the larger portion isn’t greenfield investment but financial investment. According to the latest annual report from China’s State Administration of Foreign Exchange, by the end of 2022, China had received a total of $2 trillion in foreign financial investments, with about $800 billion of that coming before 2017. Sixty percent of this $2 trillion came in 2019 and 2020, just as China was beginning to ignite a cold war with the U.S., unbeknownst to Wall Street.

According to China’s official data, 40% of this $2 trillion entered China’s bond market and 60% went into its stock market. Due to its large population, many investors believed that China’s economic rise was unstoppable, especially in light of its emerging middle class and numerous internet companies, such as Baidu, Alibaba, and Tencent.

From January to March 2020, the first quarter of the pandemic, Wall Street suddenly injected $500 billion into China’s stock market, likely due to Federal Reserve policies making U.S. investments unattractive and prompting a rush into Chinese investments.

These speculative investments caused the collapse of China’s stock market in 2021 and 2022, wiping out hundreds of billions of dollars in foreign investors’ capital. U.S. funds and asset managers, such as BlackRock, JPMorgan Chase, and Goldman Sachs, saw their investments in China go from huge gains to colossal losses.

The losses from U.S. investments in China’s bonds and stocks have had a chilling effect, and U.S. financial institutions are no longer eager to invest in China. At the same time, Beijing’s lack of transparency has made it difficult to assess the real risks associated with investing in China. Meanwhile, Beijing is becoming more desperate for foreign capital, as its economy faces headwinds from a collapsing real estate sector, record-high youth unemployment, and a declining population.

To make matters worse for China, in August 2023, U.S. President Joe Biden signed an executive order restricting certain types of U.S. investments in Chinese technology sectors, particularly in artificial intelligence, quantum computing, and semiconductors, citing national security concerns. This move marked a significant escalation in the U.S.-China economic rivalry and signaled that the era of unfettered financial flows between the two nations is over.

In conclusion, the suspension of flights to China by various airlines is just one manifestation of China’s declining international importance. The broader context includes deteriorating diplomatic relations, economic stagnation, and increasing global isolation. As China’s global influence wanes, other countries and regions, such as Southeast Asia and India, are becoming more attractive destinations for both business and leisure travelers. The world is moving on, and China is finding it increasingly difficult to maintain its former allure on the global stage.