China says it will resume issuing ordinary visas and passports in another big step away from anti-virus controls that isolated the country for almost three years, setting up a potential flood of millions of Chinese going abroad for next month’s Lunar New Year holiday.

The announcement adds to abrupt changes that are rolling back some of the world’s strictest anti-virus controls as President Xi Jinping’s government tries to reverse an economic slump.

Rules that confined millions of people to their homes kept China’s infection rate low but fuelled public frustration and crushed economic growth.

The latest decision could send an influx of free-spending Chinese tourists to revenue-starved destinations in Asia and Europe for Lunar New Year, which begins on January 22. But it also presents a danger they might spread Covid-19 as infections surge in China.

Travel services companies Trip.com and Qunar said international ticket bookings and searches for visa information on their websites rose five to eight times after Tuesday’s announcement. Top destinations included Japan, Thailand, South Korea, the United States, Britain and Australia.

Japan, India, South Korea and Taiwan have responded to the Chinese wave of infections by requiring virus tests for visitors from China.

China stopped issuing visas to foreigners and passports to its own people at the start of the Covid-19 pandemic in early 2020.

The National Immigration Administration of China said it will start taking applications on January 8 for passports for tourists to go abroad. It said it will resume issuing approval for tourists and businesspeople to visit Hong Kong, a Chinese territory with its own border controls.

The agency said it will take applications for ordinary visas and residence permits. It said the government will “gradually resume” allowing in foreign visitors and gave no indication when full-scale tourist travel from abroad might be allowed.

Health experts and economists expected the ruling Communist Party to keep restrictions on travel into China until at least mid-2023 while it carries out a campaign to vaccinate millions of elderly people. Experts say that is necessary to prevent a public health crisis.

During the pandemic, Chinese with family emergencies or whose work travel was deemed important could obtain passports, but some students and businesspeople with visas to go to foreign countries were blocked by border guards from leaving. The handful of foreign businesspeople and others who were allowed into China were quarantined for up to one week.

Before the pandemic, China was the biggest source of foreign tourists for most of its Asian neighbors and an important market for Europe and the United States.

The government has dropped or eased most quarantine, testing and other restrictions within China, joining the United States, Japan and other governments in trying to live with the virus instead of stamping out transmission.

Japan and India responded to China’s surge in infections by requiring virus tests for travellers from the country. US officials, speaking on condition of anonymity, said Washington is considering taking similar steps.

On Monday, the government said it would scrap quarantine requirements for travellers arriving from abroad, also effective from January 8. Foreign companies welcomed the change as an important step to revive slumping business activity.

Business groups have warned global companies were shifting investment away from China because foreign executives were blocked from visiting.

The American Chamber of Commerce in China says more than 70% of companies that responded to a poll this month expect the impact of the latest wave of outbreaks to last no more than three months, ending in early 2023.

The government has stopped reporting nationwide case numbers but announcements by some cities indicate at least tens and possibly hundreds of millions of people might have been infected since the surge began in early October.

The outbreaks prompted complaints Beijing relaxed controls too abruptly. Officials say the wave began before the changes.

China only counts deaths from pneumonia or respiratory failure in its official Covid-19 toll, a health official said last week. That excludes many deaths other countries would attribute to Covid-19.

Experts have forecast one to two million deaths in China through to the end of 2023.

Also on Monday, the government downgraded Covid-19 from a Class A infectious disease to a Class B disease and removed it from the list of illnesses that require quarantine. It said authorities would stop tracking down close contacts and designating areas as being at high or low risk of infection.

Meanwhile, Hong Kong will scrap some of its Covid-19 restrictions, including PCR tests for inbound travellers and vaccination requirements to enter certain venues, the city’s leader said on Wednesday.

For most of the pandemic, Hong Kong has aligned itself with China’s “zero-Covid” strategy, requiring stringent Covid-19 tests and isolation for close contacts of infected cases as well as for incoming travellers.

Hong Kong is preparing for the January reopening of its border with China, which had previously imposed harsh restrictions and snap lockdowns to stamp out the virus.

“Our society as a whole has built an extensive and high-level barrier of immunity (to Covid-19),” said Hong Kong Chief Executive John Lee at a news conference. Over 80% of the city has at least three doses of Covid-19 vaccine.

Close contacts of those who test positive for Covid-19 will also no longer need to isolate in Hong Kong, he said, and there will no longer be a limit on the number of diners per table at restaurants. The relaxed measures will take effect from Thursday.

Masks, however, will still need to be worn in public unless residents are exercising, as doing away with masks may lead to a surge in respiratory diseases like influenza just as Hong Kong faces a seasonal surge of flu cases, said Secretary of Health Lo Chung-mau.

In September, Hong Kong relaxed quarantine requirements for arriving travellers as it sought to boost tourism after over two years of entry restrictions.