The figure presents the JPY-based nominal bilateral exchange rate index for major outbound tourism destinations of Japanese travelers, constructed with 2023 as the base year (2023 average = 100). Index values above 100 indicate a relative depreciation of the yen against destination currencies and therefore a deterioration in tourism price competitiveness from the perspective of Japanese outbound demand, whereas values at or below 100 imply stable or improved affordability.
Broad-Based Loss of Price Competitiveness Since 2024
As illustrated in the graph, most destination currencies remain consistently above the base-year benchmark during 2024~2025, pointing to a structural rise in the effective cost of overseas travel for Japanese residents. The U.S. dollar index increases from the low-80 range in early 2022 to roughly 110~111 by late 2025, indicating a sustained erosion of affordability for travel to the United States. The euro index exhibits an even steeper ascent, reaching approximately 120 at the end of 2025, suggesting that Europe-bound travel has become around 20% more expensive relative to the 2023 base level.
From an outbound tourism perspective, these dynamics are consistent with muted recovery in long-haul travel, as exchange-rate-adjusted increases in airfare, accommodation, and local expenditures constrain demand.
Weakening Cost Advantage in Southeast Asia
The graph further shows that traditionally price-competitive Southeast Asian destinations, including Thailand, Singapore, and Taiwan, also shift persistently above the base-year level after 2024. Most notably, the Thai baht index rises to about 122 by December 2025, representing the largest relative increase in travel cost among the destinations examined.
This pattern indicates that the historical affordability advantage of short-haul leisure markets has narrowed, potentially slowing the rebound of Japanese outbound tourism despite geographical proximity.
Korea as a Relative Price-Competitive Outlier
In contrast, the Korean won index remains close to, or slightly below, the 2023 base level throughout 2024~2025, ending the sample period below 100. Within the visual comparison provided by the figure, Korea stands out as the only major destination maintaining near-stable exchange-rate-adjusted travel costs for Japanese visitors.
This implies a relative affordability advantage, positioning Korea as a primary candidate for substitution demand in Japanese outbound travel under prolonged yen weakness.
Structural Implications for Japanese Outbound Tourism
Taken together, the graphical evidence suggests a reconfiguration of destination choice driven by sustained yen depreciation:
- Long-haul destinations (United States and Europe) face persistent cost pressures, constraining demand recovery.
- Southeast Asia experiences a reduced price differential, weakening its traditional value proposition.
- Korea emerges as the most price-stable destination, increasing its potential to capture marginal outbound demand.
