Hong Kong faces tourism downturn

Published on : Saturday, November 21, 2020

There are hundreds of parked tour buses gathering dust at a northern Hong Kong container port, standing idle for 10 months since authorities banned non-resident arrivals into the city due to the corona virus pandemic.

The area has turned into a “bus cemetery,” according to Freddy Yip, the President of Hong Kong’s Travel Agent Owners Association. He said that the former British colony was the world’s leading tourist city destination last year. But now, it faces a bleak scenario at the end of November, with the government ending a wide-ranging wage subsidy programme that has helped about 2 million employees across all industries.

The programme was introduced in June and renewed in September; however, the Hong Kong government has ruled out an extension beyond the end of November mentioning the high cost, leaving many tourism-dependent businesses on the verge of collapse, unable to find other revenue sources and pay wages.

“If they cannot see any light ahead of them, they will just stop and cut their losses,” said Yip, who has worked in the trade for nearly 50 years.
A spokesperson for the Hong Kong government said that it would “keep a close watch on the latest situation and respond in a timely manner,” without giving any further details.

About 56 million people visited Hong Kong last year. In 2019, the city ranked number one for arrivals globally. Visitors, majority from mainland China, are drawn to its vibrant mix of cultures, dramatic harbor views and world-class shopping.

Hong Kong’s tourism sector directly employs about 260,000 people, according to the government.

Mainland Chinese visitors typically spend more per day than the average resident on baby formula, cosmetics and luxury goods. That source of spending was disconnected in early February, when Hong Kong sealed its borders to mainland China, exempting only a small number of business travelers.

Visitor arrivals declined 96% to 99% year-on-year every month since February, according to Hong Kong government figures. A travel bubble with Singapore is slated to start this week, allowing a limited number of people to move between the cities after being tested for the virus. However, that is not likely to halt the decline, said industry executives.

The arrangement would let travelers go without quarantine, but is initially limited to one daily flight of only 200 passengers each way. That is a drop in the ocean for Hong Kong, which set its own record in January 2019 with 6.8 million visitors, including 5.5 million from mainland China.

People in Hong Kong are not optimistic that things will be back to 2019 levels for at least 18 months to two years.

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