Parallel trading

Guangdong to limit cross-border visits to curb Hong Kong parallel goods trade

Officials want to respond to concerns in Hong Kong about the impact of parallel trading; an academic proposes a cap of two trips a day

PUBLISHED : Thursday, 19 March, 2015, 1:07pm
UPDATED : Wednesday, 20 June, 2018, 3:02pm

Mainland authorities plan to limit the number of visits travellers can make to Hong Kong in a bid to combat cross-border trading, with a source close to the Guangdong government suggesting a cap of two visits per person, per day.

The plans come amid rising tension in Hong Kong over the impact of tourism and so-called parallel trading - the bulk buying of goods in the city for resale over the border. Pro-Beijing newspaper Ta Kung Pao reported, citing an unnamed Guangdong government source, that mainland authorities had put forward several proposals to limit the number of visits Shenzhen residents could make.

The potential changes would affect the individual visit scheme, introduced in 2003 and since expanded to allow residents of 49 mainland cities to travel to Hong Kong without joining tour groups. In 2009, Beijing extended the arrangement to allow people with household registration in Shenzhen to apply for multiple-entry permits.

The scheme is opposed by Hong Kong protesters who say it encourages cross-border trading; critics say the influx creates a nuisance due to overcrowding and that their activities push up prices in the city. A series of recent protests have turned violent.

The unnamed source quoted by Ta Kung Pao did not say how many visits were being proposed under the plan.

Professor Zheng Tianxiang, of the Pearl River Delta Research Institute at Guangzhou's Sun Yat-sen University, said he had proposed to Guangdong authorities liming the number of visits by a holder of a multiple-entry permit to two a day.

"For visitors travelling to Hong Kong for academic exchanges and business trips, two visits to Hong Kong per day are already enough. My proposal should be able to resolve the problem arising from the influx of parallel traders," Zheng said.

A person familiar with the Hong Kong government's position said the Hong Kong and central governments were working towards setting a cap on the number of visits multiple-entry permit holders could make.

"But the mainland authorities are juggling with the number of visits a multiple-entry permit holder is entitled to," the person said.

Secretary for Commerce and Economic Development Greg So Kam-leung said the central government would take into account different factors in its deliberations on how to refine the individual visit scheme and the multiple-entry arrangement.

But he said Beijing had yet to make a decision

Zhou Bo, deputy director of the State Council's Hong Kong and Macau Affairs Office, said last week the individual visit scheme and multiple-entry arrangement for Shenzhen residents would be refined to "better suit the situation in Hong Kong".

Ip Kwok-him, a lawmaker from the Democratic Alliance for the Betterment and Progress of Hong Kong, said pupils who live in Shenzhen and study in Hong Kong and their parents should be exempted from the restriction.

He urged authorities to gather figures on this group before deciding on a cap.

Another lawmaker, tourism representative Yiu Si-wing, said in the short term, the authorities should not consider raising the number of visits for mainland tourists or extending the multiple-entry scheme to other cities.

"If parallel trading worsens after implementing these measures, it would create more problems and grievances," he said.