Maybe mainland visitors aren't so bad after all
Reports that the government is considering reducing the number of mainland visitors by around 20 per cent has set the cat among the pigeons. For months there have been murmurings about how inconvenient it is to have the city overrun by mainland tourists. There have been complaints and indeed demonstrations about how mainland tourists crowd streets, transport, shops, push up property prices, and pee in the streets.
But the prospect of a 20 per cent cut has not gone down well with the sectors that directly benefit from the visitors, that is, the shops that sell gold jewellery, luxury goods, and cosmetics and so on. It turns out that the reduction in mainland visitors called for by some sectors of the community will endanger the jobs of those working in the retail sectors that could be affected. The news has affected the stock market with retail sector shares, along with those of the property firms that house the stores, since rents could fall.
It has been left to the investment banks to put all this in context with some numbers. UBS says that a 20 per cent cut in individual visitors would lower the city's retail sales by 4 per cent. Goldman Sachs notes that, excluding spending on hotels and other unrelated expenditure, spending by mainland tourists was roughly HK$180 billion last year or 36 per cent of Hong Kong's retail sales. But it points out that spending patterns vary across different mainland groups, with spending by those who stay at least one night some three times higher than same-day tourists. Same-day tourists, who account for around 60 per cent of mainland visitors, spend on average HK$2,700 per head, while overnight tourists spend an average of HK$8,900.
It follows, says Goldman, that the impact depends on which visitor groups are targeted. If only same-day visitors are targeted this would result in a reduction in retail sales of HK$15 billion a year or 3 per cent, but if the cuts are directed evenly across all individual visitor groups, then the hit to retail sales would increase to HK$25 billion or 5 per cent.
Plain sailing with ACE
ACE Life, the global life insurance division of ACE Group, has decided to promote its brand by giving the public trips around the harbour in a yacht. It's also taking disadvantaged families out to Lamma. This is clearly a nice idea but hardly original.
In a rather self-congratulatory press statement to announce this initiative, ACE says it is an example of the "can-do attitude" that ACE likes to bring to everything it does. "It also represents an initiative that resonates with our organisation's values of creativity and innovation," it burbles. There is more. "We believe that the ACE yacht is also symbolic of our 'can-do' attitude which differentiates us from others in the insurance industry." We agree that's the message we're supposed to take away but it gets spoilt when spelt out like this. Pity to spoil a good idea with a silly press release.
Members of the public can join the trips which start at Tsim Sha Tsui on June 29 by registering at www.acelife.com
Recent efforts by Elvis Au, an assistant director of environmental protection, to sway public opinion in favour of building a giant incinerator near the island of Shek Kwu Chau with letters to the press, have evidently not been wholly successful. A message from the Living Islands Movement committee to its members has asked for the best dates to organise a protest march through Central against the project to let the government really know how residents feel about the incinerator. "Legco members need to be made aware of how much public resentment there is for this ludicrous scheme," the committee says in an e-mail. Street demonstrations are one of the few forms of protest the government takes any notice of. The tactic is double-edged since a small turnout will embolden the government to press ahead with the scheme.
Moves at HSBC
HSBC's Russell Julius, head of banking for Asia-Pacific, is to return to London. He will lead a team offering investment banking services to commercial-banking customers, Bloomberg reports. Liu Che-ning, head of banking for Hong Kong, mainland China and Taiwan, is to be co-head of Asia-Pacific banking.
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