• Sat
  • Sep 20, 2014
  • Updated: 10:41am
NewsHong Kong
TOURISM

Property, retail shares fall on fears chief executive will cut mainland visitor numbers

Chief executive plays down talk of 20pc cut in mainland visitors but property and retail investors don't get message and shop owners cry foul

PUBLISHED : Tuesday, 27 May, 2014, 11:16pm
UPDATED : Wednesday, 28 May, 2014, 7:26am

Chief Executive Leung Chun-ying yesterday played down reports the government was considering cutting the number of mainland visitors by 20 per cent.

But that didn't stop the shares of retailers and property developers falling and retailers crying foul.

Leung said the government was "listening to views" about how to handle the annual influx of 40 million mainland visitors, a number that is expected to reach 100 million by 2020.

Some legislators have called for the one-year visas that allow multiple entries, introduced in 2009, to be scrapped.

Pan-democrat lawmaker Claudio Mo Man-ching said yesterday that would effectively reduce the number of mainland visitors by 25 per cent.

"In Causeway Bay, buying a gold necklace is easier than buying a mop," she said. "Multi-entry permits should be halted and the number of individual visitors curbed."

Secretary for Commerce and Economic Development Greg So Kam-leung said the government would gather data on mainland visitors before discussing arrangements with Beijing.

The sight of mainland tourists pouring into the city, inundating public transport and snapping up homes, designer handbags and daily necessities has caused much public discontent.

Protesters have been on the march, demanding the government curb visitors from the mainland under the independent traveller scheme, who accounted for two out of every three visitors to the city last year. Mainland visitors accounted for 7.9 per cent of Hong Kong's inbound visitors in 2003, but this surged to 67.4 per cent last year.

The Hong Kong Retail Management Association warned that reducing those numbers would threaten the job security of the city's 267,000-strong sales workforce and urged the government to create more shopping malls and tourism facilities to ease pressure on existing shopping districts.

Shares in cosmetics retailer Sa Sa closed down 3.79 per cent at HK$5.58, those in jewellery chain Chow Tai Fook fell 3.22 per cent to HK$10.22 and those of fashion group IT lost 2.42 per cent to close at HK$2.42.

Prince Jewellery & Watch chief executive Jimmy Tang said he strongly disagreed with any move to cut visitor numbers.

About 90 per cent of the group's customers are mainland visitors and he expected to see sales suffer if the 20 per cent reduction went ahead.

Wholesale and retail constituency lawmaker Vincent Fang Kang said cutting the mainland visitor numbers by 20 per cent would be "too drastic".

He said the government should stop those mainlanders taking day trips as they were largely parallel-goods traders.

Helen Mak, of Colliers International, said retailers in Mong Kok and northern districts would be hit hardest by any restrictions, as they made profits from large volumes. "A drop in the number of buyers would definitely hit their sales, and consequently rents," she said.

Shares of Hysan, owner of Hysan Place in Causeway Bay, dropped 3.26 per cent to HK$35.60; those of New World Development, the landlord of K11 in Tsim Sha Tsui, dipped 0.22 per cent to HK$8.73. Shares in Wharf, which owns Times Square in Causeway Bay and Harbour City in Tsim Sha Tsui, were down 3.54 per cent at HK$53.10.

A Hysan spokesman said the group had a balanced portfolio of tenants and did not rely on any one group in particular.

Mak recently predicted overall rents in major shopping districts would fall 5 per cent in the next 12 months on the back of more vacancies, with Causeway Bay rents dropping 10 per cent.

Additional reporting by Ernest Kao

 

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26

This article is now closed to comments

ant5354
It is sad to see that Hong Kongers do not welcome the tourists from Mainland, Hong Konger even hate them in a discriminating way although they actually bring lots of business to the Hong Kong's prosperous.
.
I understand the Hong Kong people's angry but I sympathize the tourists from Mainland as well. They come to Hong Kong to experience life in a well developed city. But I am afraid that Hong Kong may have impressed them in a very negative way.
First, they are cheated by immoral tour guide and are forced to consume,
Second, the lady was asked if they are pregnant when they are passing the immigration officers.
Third, the sales of the pharmacy shop reluctantly answer their questions.
Four, there are never seats (in buses, trains, parks or restaurants) to rest after a whole day shopping.
Five, there are always extremely long queue in the toilets,
Six. They paid skyrocketing hotel price but obtain tiny space and limited facility.
Seven. People stare at them as they are aliens.
Eight, They are attacked by the marchers who shouted at them and asked them to leave.
Nine....
Ten....
I doubt that their enthusiasm about Hong Kong will last long if nothing have been done to easy the anger of Hong Kong people, the host. .
johnyuan
Common sense shall rule and not special interests. For CY Leung, courage shall be used for him to speak up again.
kctony
It was a property policy all the way. The picture was on the wall and Donald Tsang blatantly refused to see it. The net GDP according to a columnist here is 1%, not the 4.5% the government said. But the price was hell to pay.
Late, but a welcomed idea from CY.
syn
There is nothing wrong with making money and investing, but investing should be an informed gamble. As soon as the investor is able to employ the government to push his or her profits, the whole system turns into Hong Kong. Heck, why even employ the government, just get yourself put onto various government councils and consultant groups to get the job done yourself.
chuchu59
For a start a 20% reduction seems reasonable though some fine tuning in say 6 months time is warranted. As for rentals, shouldnt retail shops cater to the local population mainly? I feel for those who may be laid off but its time we become less reliant on mainlanders and their cash.
eddywonlung247
Hit them hard reduce mainlanders by 90 percent.
donniemcm
"A drop in the number of buyers would definitely hit their sales, and consequently rents," If she meant the rent will drop, then yes please.
hkqx
Have Property or Retail industry or travel industry voice their concern ? I think they are not loud enough. On the other hand, people have spoken to reduce the tourist. Let it be. Why not ? I'm being sarcastic. But really 10 to 20% guidelines is good.
virokick
Mainland numbers down = CY Leung Popularity Up= Re-election chances up.
Mainland numbers down= Rental , Property Prices Down = HK people happiness up.
Mainland numbers down= Prada, LV , Chow SS, Sassa down= Rental down= local bakery/ noodle shops happy.
Cut up to 50% mainland numbers = cut more numbers = HK people more happy.
Hum-Balang
If half of China wants to visit HK just once, it will take 650M/40M per year or 16 years to subside, the stampede started in 2004, surely this can be over by 2020?

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