During his first 100 days in office, Chief Executive Leung Chun-ying helped to shelve a plan that would have allowed non-permanent residents of Shenzhen to apply for multiple-entry permits to visit Hong Kong. But non-permanent residents of Shenzhen and five other mainland cities are still being offered easier access to our city. They can now apply for single- or dual-entry permits without first having to return to their home towns. We asked experts, industry insiders and members of the public what this means for Hong Kong's tourism industry.
Q1 How would you assess the impact of changes to entry permit rules that could bring more mainland tourists to Hong Kong?
Q2 How should the Hong Kong government assess the city's capacity to accommodate tourists? What factors should be taken into consideration, and are there any signs that Hong Kong is running beyond its capacity?
Q3 Do you think the government lacks a long-term plan for tourism? What should be done in the face of an increasing number of mainland tourists?
Caroline Mak Sui-king
Chairwoman of the Hong Kong Retail Management Association
A1 Although the new relaxation may encourage some to come to the city, its impact would hardly be comparable with the introduction of the individual visitors' scheme in 2004. First of all, many of those living in the cities covered by the recent rule changes have already been to Hong Kong. Secondly, they need to travel by air and this is not easy. I would say there may be an increase in tourist arrivals, making a positive impact on the retail trade. But the increase will not be significant - not, as someone else assumed, by several per cent. For retailers, more visitors mean more customers. That is something that we welcome. Many Sheung Shui residents are discontented about tourism due to the nuisance caused by parallel traders. If the government stepped up efforts against the trade, people wouldn't be as angry. Hongkongers should adopt a broader perspective when they look at the tourism issue. On the one hand, the increase in tourists has lifted rents. On the other hand, its contribution to the local economy should not be ignored. We have to do some maths and see whether the overall impact is negative or positive.
A2 There is some information that is readily available, such as the number of immigration officers at border points and the Immigration Department's pledge on the time taken to clear the border, which should be considered by the government when it assesses the city's tourism capacity. Apart from those, I would say the availability of shopping space is something that should be assessed. Over the past years, shopping has been concentrated in a few spots such as Causeway Bay and Peking Road in Tsim Sha Tsui. People keep spilling along Nathan Road, and they don't bother going to Tsim Sha Tsui East. The small number of shopping points means tourists are highly concentrated, and they make those areas extremely packed. Residents have complained about inflation, but I think the government should get to the root of the problem and identify its cause. Rent hikes pushed retailers to raise the prices of their goods, and the hikes are a result of a shortage of retail space. Inflation is, in fact, a result of an acute shortage of shopping space.
A3 If the government had started long-term planning and carried out projections when it kicked off the Individual Visit Scheme in 2004, there wouldn't be such a negative response towards tourism now. Over the past 15 years, hardly any big retail space was rolled out in the market. The Housing Authority's privatisation of its 150 shopping centres in 2004-05 was the biggest mistake. The building of 1881 Heritage, which turned the former marine headquarters into a luxury shopping mall, was another failure. As the biggest landlord, the government can do more to develop new shopping areas similar to Tsim Sha Tsui or Causeway Bay by urban renewal. The development of Kai Tak is a good opportunity to take. I'm not [Chief Secretary] Carrie Lam Cheng Yuet-ngor. But the government should establish a think tank to work on tourism planning. Exchanges with devoted veterans can solve the problem.
Resident of Sheung Shui
A1 Tourism leads to a boom in cosmetics chains and pharmacies that locals don't need. Five to six years back, there was only one Sasa outlet in Landmark North. Over the past two years, cosmetics chains and pharmacies have opened everywhere. There are four such shops around a street corner, and they took the place of an outlet popular among the community for cheap sports shoes. I've been buying shoes there since my primary school days, but it closed last year. One woman selling underwear told me rents run so high that she would rather rent the shop to others than run it. Parallel traders were like carbon dioxide when I was in primary school - they were there, but barely noticeable. Now I am crushed by them at Sheung Shui station. There is no space to park my bicycle outside the station. Despite the efforts against parallel trading, tourism has already taken its toll on the neighbourhood. There are so many genuine tourists coming from across the border, and they carry luggage. I can't stand the huge crowd, especially when they are not that civilised. Now, I would rather be at home than go out. Cultural invasion is another drawback. Putonghua and simplified Chinese characters are everywhere and I don't like them. Tourists from Guangdong still speak Cantonese. I can't imagine the influx of tourists from further north. The conflicts would be even bigger.
A2 The government should look at the supply of hotels and guesthouses and, of course, physical space. Hong Kong is so small, and the number of tourists arriving in a year is now six times the population. How can the city handle the crowds? Looking at the cultural aspects is also important. I used to believe mainland tourists would adapt to local culture, that they would queue for public transport, for example. Some mainland internet users praised how civilised Hong Kong was, but they turned out to be a minority. Over the past month, my friends told me of several cases of cultural confrontations. One was travelling on the MTR with a basketball, and a mainland tourist's child played with it. When my friend was about to go, the child refused to hand it back. His mother asked if they could buy it for HK$100. We were so shocked at her attitude. Another friend was knocked down by a child in Sham Shui Po. The parent just laughed and walked away. Then there was a friend who said "excuse me" to a tourist as the sidewalk was so crowded. The man said: "Why don't you speak in Putonghua?" These conflicts are occurring much more often, and in my opinion we are on the edge of an outburst.
A3 When I travel to Singapore, the experience is very good: the air, the environment, and the heritage hotels. I stay in a heritage building revitalised as a hotel, and it costs little, not like Heritage 1881. Much work is done to restore old buildings. In contrast, Hong Kong, which earns its money from mainlanders, has focused too much on shopping. From my interactions with foreign tourists such as those from Japan and Korea, they seem to be travelling to get a sense of a different culture or lifestyle. I want more of them to come. More work can be done to refurbish old districts and preserve local culture. Instead of giving out HK$6,000 cash rebates, the government could use the money to make chaotic urban districts more stylish. The government should seek to have more say over the number and types of tourists coming across the border.
James Tien Pei-chun
Chairman of the Hong Kong Tourism Board
A1 For decades, tourism has been one of the four pillars of Hong Kong's economy. While the other pillars - financial services, trading and logistics, as well as professional and other producer services - are plagued by the euro-zone sovereign debt crisis and decreasing demand from the major advanced economies, tourism continues to enjoy robust growth, providing impetus to the development of other sectors, such as retail and dining, and creating direct employment for at least 220,000 people, or 6 per cent of total employment. Last year, tourism receipts exceeded HK$263 billion. Few would deny that the phenomenal surge in mainland visitors has, in general, brought significant economic benefits to Hong Kong. As important as mainland visitors are, however, the Hong Kong Tourism Board is committed to maintaining a balanced portfolio of visitors, in line with our city's image as a diverse, dynamic and cosmopolitan destination. That is why the board has been investing 70 per cent of its annual worldwide marketing budget on non-mainland, international markets. As for the remaining 30 per cent put behind the mainland, more than 75 per cent is allocated to the non-southern-China regions, in particular second- and third-tier cities that can open up new overnight visitor sources for Hong Kong. For example, in central China, leveraging on the opening of the Guangzhou-Shenzhen section of the Guangzhou-Shenzhen-Hong Kong Express Rail Link last December, efforts are being made to encourage visits to Hong Kong via Shenzhen. Those efforts are bearing fruit. In the first eight months of this year, overnight arrivals from non-southern China were up 19.4 per cent year-on-year. These visitors' spending also went up 12.5 per cent in the first six months to almost HK$12,800 per capita, much higher than the HK$8,600 by an average mainland overnight visitor, and the HK$4,900 by a Guangdong visitor.
A2 As a tourism marketing organisation, the board welcomes every visitor from both the mainland and overseas, whether they are here for business or holiday and whether they are visiting for a day or for a week. However, we also believe it is important to ensure there is no friction between visitors and residents, as well as to ensure every visitor receives a warm reception and enjoys a happy stay. That is why I earlier expressed grave concern at the news that the government was considering allowing multiple-entry permits for 4.2 million non-permanent Shenzhen residents. I believe the arrangement, intended to give Shenzhen residents greater convenience in visiting Hong Kong, may be misused by them to take up illegal employment or take part in cross-border parallel trading, worsening the nuisance of the proliferating cross-border trading in Sheung Shui. I was pleased, therefore, that the government temporarily suspended the implementation of the arrangement, and that it took tough action against cross-boundary parallel traders.
A3 What we have to do is to enhance Hong Kong's tourism capacity without placing undue pressure on our resources or our community. I am confident that with vision, commitment and the concerted efforts of the government, the tourism and related industries and the community, we can strike a balance in the creation of jobs and expansion of our economy, while addressing the social concerns.
Roy Tam Hoi-pong
Chief executive of the environmental group Green Sense
A1 Having more mainland tourists in Hong Kong would have three big social and environmental impacts on the city: overcrowding, increasing numbers of cross-border traders and inflation. Not only Mong Kok, Causeway Bay and Tsin Sha Tsui, even Tsuen Wan, Sha Tin and Tai Po are packed with mainland tourists. The city's social capacity has been exceeded. People have nowhere to go over the weekend as everywhere is full with mainland tourists. Also, since Shenzhen permanent residents were allowed to apply for multi-visit permits to Hong Kong in 2009, the problem of cross-border illegal trading at Sheung Shui MTR station has caused serious chaos as different exits of the MTR station are packed with thousands of traders. The rising rents are one serious problem caused by the influx of mainland tourists. Now the cross-border trading activities have imposed an extra potential impact on inflation. The government should restrict those activities to relieve the problem.
A2 According to the Tourism Board, the percentage of tourists who come from the mainland is growing. Last year, the percentage was 68 per cent; this year, up to July, the percentage reached 74.7 per cent. The average number of mainland tourists every day ranges from 80,000 to 100,000. Last year, more than 40 million mainlanders visited Hong Kong; this year the number is already approaching 20 million. The enormous number of tourists brings pressure in all fields, such as traffic, accommodation, catering and crowded streets. The city is now running beyond its capacity. To cope with the influx of mainland tourists, shopping malls tend to increase the use of simplified Chinese in their signs and advertisements; meanwhile, more and more shops, including those serving the community, are being replaced by cosmetics stores, pharmacies, and retailers targeting travellers. This triggers inflation and increases in rent. All these facts show that the number of tourists has exceeded the city's social capacity.
A3 The Individual Visit Scheme is gradually expanding; the six cities: Shenzhen, Beijing, Tianjin , Shanghai, Chongqing and Guangzhou, will continue relaxing the rules on non-permanent residents, letting them apply for single- or dual-entry permits to Hong Kong without first having to go to their home cities. It shows that the government lacks long-term planning for tourism as the city is already overcrowded. As stated in the Basic Law, under the Individual Visit Scheme, practically only the mainland has the right to approve single-entry permits. It seems impossible to get back the right to approve who visits. However, the government should bargain with the mainland, supporting by the idea of "one country, two systems" established in the Basic Law. With the right of immigration approval, the government can control the daily number of mainland tourists. The maximum capacity for visitors should be determined from the perspective of tourism management. The city is now overloaded with mainland visitors, and the social issues they raise are becoming more serious day by day. In order to solve this phenomenon, the government needs to set up new strategies to promote Hong Kong, to attract people from other countries instead of putting the focus on the mainland only.
Assistant professor at the school of tourism and hospitality management at Polytechnic University
A1 The question should not be how Hong Kong assesses the impact of more mainland tourists. The question should be what kind of visitor mix Hong Kong would like to have and strive for. With mainlanders accounting for more than 70 per cent of visitors from January to July, it is generally accepted that the mix is skewed towards one source and Hong Kong should strive for more balance. Achieving a more balanced visitor mix does not necessarily mean higher economic benefits. The benefit lies in a less risky, healthier and sustainable industry. Tourism development in the past tended to gravitate towards the mainland, and this may not be advantageous in the long term. Tourism is about cultural exchange, wellbeing, goodwill and understanding among people from different parts of the world, in addition to economic benefits. A bias towards one source is not conducive to generating broader benefits.
A2 It is difficult to assess the city's carrying capacity for tourists. Hong Kong faces a peculiar situation of a very high percentage of same-day travellers - 50.5 per cent in January-July (46.8 per cent last year), visiting friends and relatives, and multiple entries. About 17 per cent of overnight visitors visit friends and relatives, and some do not pay for accommodation. Multiple entries occur when a visitor arrives in Hong Kong, passes through immigration, leaves Hong Kong to go to, say, Macau, or the mainland, returns and passes through immigration again. This visitor would be counted as two arrivals. All these complications make assessment very difficult. We could examine relevant indicators and get a reading of the capacity limit, and hotel occupancy is one such indicator. Overall hotel occupancy in Hong Kong last year was 89 per cent. This compares to 84 per cent in Singapore, 74 per cent in Australia, 62 per cent in China and 60 per cent in India. Other factors that should be taken into consideration are community sentiment, employment rates and price levels.
A3 The government sets tourism policy, spearheads tourism projects, co-ordinates tourist activities among different departments, regulates the industry, and promotes the city as a world-class destination. Hong Kong could benefit from a tourism master plan that looks hard at the social and economic benefits of tourism, evaluates Hong Kong's tourism potential, assets, desirable target markets and human resources, and determines what the gaps are. If there is a need for more hotel accommodation, the government could work with the industry on hotel zoning. If there is a need for more shopping by mainland tourists, the government could work with developers to create a mega shopping mall near the Lo Wu border. If there is a need for more human resources, the government could work with academic institutions to provide more relevant programmes. The government should help the industry and the community understand the economic and social benefits of tourism. To maintain the unique characteristics of Hong Kong as a Chinese city with 150 years of British colonial influence, there is a need to preserve the heritage. This is not about waving the colonial flag. This is more about preserving heritage in a form that can be gazed at by tourists and remembered by the local community.
Michael Wu Siu-ieng
Chairman of the Travel Industry Council
A1 Non-permanent residents of six mainland cities can now apply for single or dual-entry permits to Hong Kong without first having to to their home cities. They may now visit Hong Kong more often so I'm sure the city will see more arrivals. However, not all will be interested in coming. Although the change makes it easier for individuals to come, travel agencies are also going to benefit as some tourists opt for group tours. As the government categorises tourist arrivals by the type of visas or permit they have, it may seem at first glance that a majority of mainlanders come to Hong Kong as individuals. In fact, the number of people in group tours has also increased by 20 to 30 per cent a year. Any policies that promote tourist visits enlarge our customer base and attract more business.
A2 I would like to ask the government this question. I agree, border clearing and hotel supply should be considered. The government has got figures on how many immigration officers or hotel rooms there are. It can easily calculate how long is needed before each tourist gets across the border. However, how can it draw a line and come up with something called "capacity"? If there aren't enough officers at the border, the government can hire more. If there are periods when the border is too busy, there can be co-ordination among travel agencies. We can avoid going to the border points at the same time. There is always room for improvement. Is Hong Kong full yet? There are a lot of tourists in Causeway Bay and Tsim Sha Tsui, but shopping has gradually spread to Sheung Shui, Sha Tin and Tung Chung. Some say tourism has prompted rents to rise and that it is already affecting the livelihood of citizens. They should talk to the property developers. It is wrong for them to lift the rents. Is Hong Kong's development serving the interest of developers only? If the developers charge skyrocketing rents, they could kill the retail industry. On the other hand, one should not link the city's tourism sustainability to parallel trading. The traders are not real tourists, and it does not make sense economically to give up 10 million travellers because there are several thousand parallel traders among them. The government should focus on prosecuting parallel traders, not limiting genuine tourists. It is not worth it to ignite negative sentiments in the mainland market by imposing restrictions on arrivals. For all tourist cities, the large influx of travellers causes change or disturbance. To have an extra 100,000 tourists on the streets is going to have an impact. But citizens should show tolerance as tourism is so important for the city.
A3 Hong Kong is a small city, and there are physical constraints when it comes to tourism planning. Premises are smaller than those overseas, but the good transportation network makes up for it. There are lots of good restaurants and shopping. It's usually locals, rather than tourists, who complain about the inadequacies of tourism hardware in Hong Kong. Someone who doesn't gamble can see everything in Macau in a two-day trip. In contrast, there are more than 10 popular attractions in Hong Kong, and it may take tourists three or four trips to visit them all. In the long run, the government can put more effort into developing smaller attractions. The flower market in Prince Edward, the "women's street" in Sai Yeung Choi Street and the fruit market in Yau Ma Tei, for example, can be linked up in a tourist route. Developing a huge outlet mall is another option.