Firms poised to cash in as the good times roll

PUBLISHED : Wednesday, 03 November, 1999, 12:00am
UPDATED : Wednesday, 03 November, 1999, 12:00am

As fairytale becomes fact and Hong Kong prepares for construction of its theme park, economists have welcomed the inevitable boost the project will bring.

Companies from a wide range of industries, both directly and indirectly connected to the project, are expected to capitalise on the building of Disney's fifth major park.

The economy is expected to experience the benefits almost immediately, as the SAR emerges from the worst recession in a generation.

'It will create employment opportunities as early as the first quarter of 2000,' said Chris Leung, senior economist at DBS Securities.

He said as long as the Government did not import foreign labour, the project would ease unemployment problems in the beleaguered construction industry.

However, sectors such as hotels and restaurants are not expected to experience the benefits for years.

The project initially will include a 1,400-room Disney-themed hotel, later to be expanded to 2,100 rooms and a retail, dining and entertainment centre.

Tristan Chua Tianyu, a retail analyst at Goldman Sachs (Asia), said restaurant companies could benefit more than hotel operators as a large proportion of visitors would be day-trippers.

'Hotels will not be big beneficiaries, but visitors will have to eat,' he said.

The key to Disney's success will be its ability to attract visitors from the mainland, and it is this market that has been Hong Kong's leading tourist source in recent years.

Last year, mainlanders accounted for nearly 2.6 million visitors, or 27.1 per cent of the total.

Mr Leung said concerns over mainland visitors not being able to afford to visit the park were unfounded as many Chinese had the disposable income to take such holidays.

'Tourists will be attracted to Hong Kong because of Disney, but that is not the main attraction,' he added.