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Hong Kong MTR

Hong Kong railway operator pushes ahead with duty free centre at border station despite drop in visitors

Tender for construction work at MTR Corp’s Lo Wu station will begin early next year

PUBLISHED : Friday, 28 October, 2016, 10:32pm
UPDATED : Friday, 28 October, 2016, 11:29pm

The MTR Corporation has pushed forward with a plan to upgrade its Lo Wu station into a duty free shopping centre despite dwindling visitor numbers.

A 740 square metre extension dedicated to duty free shops is being added to checkpoint station between Shenzhen and Hong Kong. The tender for construction work is due to go out in the first quarter of next year.

An MTR Corp spokesman said the project was part of its “asset renewal” programme on which it spent HK$7 billion a year to “benefit travellers” by improving facilities.

Mainland visitors returning, but with tighter budgets

First proposed in 2014, the duty free project at one of its busiest stations was meant to capitalise on the growing demand of mainland shoppers and ease the pressure caused by a huge influx of parallel traders from across the border on Hongkongers living in northern district. The traders buy goods in Hong Kong to sell at a profit on mainland China.

But such demand has sharply decreased over the past two years. There were 9.2 per cent fewer mainland visitors in the city during the first eight months of this year. Their average spending also dropped – down 15.8 per cent to HK$7,105 each in the first half of the year.

While the opening date of the duty free shop extension has not been confirmed, the spokesman said the prequalification process for tenders to build the foundations would start next month.

The new complex will mean more competition for San Tin Shopping City, a 420,000 sq ft American-style pop-up mall near the Lok Ma Chau border checkpoint, which is due to open at the end of the year.

The mastermind behind that project, lawmaker Wong ­Ting-kwong, said he was not worried about the competition.

“We target totally different customers,” Wong said, adding the duty free shops at Lo Wu station would be located in the restricted zone, which meant customers could not buy products without crossing the border.

Wong also said the mall he proposed would be more resilent to the tourism downturn as it had already ­repositioned itself to cater to locals, with half of the customers expected to come from Yuen Long, Tuen Mun, Sheung Shui, Fanling and other nearby districts.