The city is in a good position to develop short-distance tours with stops in major Asian cities, Ho said, although it might be less scenic compared to cruise stops in the Mediterranean and Caribbean.

While cruise travel is still at its early stages in the city, plans seem headed in the right direction, with the government's announcement yesterday that the Kai Tak cruise terminal would be operated by the Worldwide Cruise Terminals Consortium - marking an end to a four-year tenancy battle. Two rounds of tender in 2008 had failed to name an operator.

Travel Industry Council chief Michael Wu Siu-ieng was optimistic about the domestic market.

'In the past, only the retired got on vessels. Now white- and blue-collared workers are also showing interest as they look for more relaxing travel experiences.'

He said cruise tourism would boost multi-destination tourism between Hong Kong, Macau and Guangdong.

Last year, there were 702,017 inbound cruise visitors, 6.3 per cent more than a year ago. Mainland China contributed 507,000 visitors. Travellers from Europe, the Middle East and Africa came in second, but their combined total dropped 34.9 per cent from a year ago to 49,922.

The new terminal is expected to put an end to embarrassing logistical snarls, such as when the Queen Mary 2, the world's largest transatlantic ocean liner, and the Diamond Princess were forced to berth at Junk Bay. The latter's 3,000 passengers had to take a 15-minute trip to Central on smaller boats, which the operator called a shameful experience.

Tourism sector lawmaker Paul Tse Wai-chun said cruise travel was still a novelty for mainlanders, adding that Hong Kong had to be a step ahead of other Asian destinations.

The Tourism Board will devote HK$15.5 million to promote cruise tourism next year, and will launch a fund to attract ships to Hong Kong.