Costa Cruises Pulls Asia Trips Amid China’s Covid Zero Policy

By K. Oanh Ha (Bloomberg) —

Costa Cruises, a unit of Carnival Corp. that aimed to cater to the Chinese market, is canceling all future Asia departures as hope diminished of any early loosening of Covid restrictions in the country. 

“As a result of continuing uncertainties regarding the full restart of international cruises in East Asia, Costa Cruises has decided to reorganize its structure in the region,” the Genoa, Italy-based company said in a statement, adding it’s canceling “future Asian home ports cruise programs.”

Though the company didn’t reference China, Costa advertised that it had big plans to tap consumers there and was the first cruise company to enter China in 2006. It built two massive ships exclusively for the market, with plans for a 2021 debut of the Costa Firenze in Asia never materializing and redeployed to Europe as Chinese leaders adopted a Covid Zero policy to deal with the pandemic.

Hopes of China easing its strict Covid restrictions dimmed after the leadership shuffle over the weekend at its all-important Party Congress, with no indications from President Xi Jinping of any departure from its pandemic approach even as the rest of the world lives with the virus. Chinese tourism stocks, along with Asian equities, slumped Monday. 

China has allowed limited cruise operations domestically for mainland residents, with most taking place on inland rivers and some domestic coastline cruises. It recently allowed a local operator to restart a cruise to the disputed Paracel Islands, which Vietnam also claims in the South China Sea.  

Costa Cruises said it’s informing employees and local stakeholders in Asia affected by the reorganization and cancellation of Asian cruises. Its website for the Asia market generated an error message Monday. In February, the company touted plans to resume cruising in Asia this year. Previously, it had port stops in China and Hong Kong as well as Japan, Singapore, South Korea and Taiwan. 

–With assistance from Zibang Xiao.

© 2022 Bloomberg L.P.

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