In Hong Kong's near-euphoria over growth in mainland visitor numbers, the greater growth into Macau may have been overlooked. According to the mainland's tourism office (whose data, as with most countries' outbound traveller figures, do not match visitor arrival counts at the destination), travel to Hong Kong grew 20 per cent last year, but 72 per cent into Macau. It gained two million more mainland visitors over 2002, compared with 1.5 million more from the mainland into Hong Kong. With the opening of more casinos in Macau, it is possible that the previously inconceivable could happen - Macau could catch up with Hong Kong, and as early as next year. The mainland's rapid growth has made it the biggest visitor source for Macau; until last year, Hong Kong had always been Macau's largest source. Another factor for the future is Macau's airport. Airport could be the ace Can Macau's airport grab the low-fare airline business at the expense of Chek Lap Kok? AirAsia started flying Bangkok-Macau in June, but the big test will be when the next three known low-fare airlines start flying this way - expected in the next four months. The three include Bangkok-based Nok Air and Singapore-based Tiger, neither of which has started flying anywhere yet. However, both are subsidiaries of their respective national airlines, and may not operate with quite the same disciplines as an independent low-fare airlines. The third would-be challenger is as yet unnamed, but is Singapore-based and 49 per cent-owned by Australia's Qantas Airways. Despite this Qantas link, that airline (possibly to be named Jetstar Asia) is more likely to follow a common business pattern for low-fare airlines in the US and Europe - and use a lower-cost airport near the city. In other words, Macau for Hong Kong? But the prime target for a boost to Macau could be the mainland market. If Macau airport attracts new airlines, particularly low-fare airlines, with lower landing charges, it could attract a newer lower-cost passenger base out of China - particularly from Guangdong and Hainan, and perhaps even Fujian. Yet another element would be Hong Kong airport's operational plans for Zhuhai airport. Could this be developed as a rival to Macau airport if it looks as though Macau would otherwise capture low-fare airline business? Staying power The hotel business started the year well. Occupancy is up 4 per cent at three-star hotels for the first three months, up 20 per cent at four-star hotels, with a strong 10 per cent growth for the top hotels, as indicated in the table. Sars began to affect hotels towards the end of March last year, so results this year in the first quarter do not yet show the rapid improvement that will appear from April. Growth in the average room rate was also good at the three- and four-star levels. But at the top of the market there was a fractional decline. In terms of 'revpar', hoteliers in Hong Kong should be pleased - it was up 16 per cent for three-star hotels in the first quarter, 43 per cent for four-star and even 14 per cent for the top of the market. This is the figure that is watched most carefully by the industry - as it is a combination of the number of rooms occupied and the price achieved for each occupied room. Compiled by Murray Bailey, research director and editor, Travel Business Analyst