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Hong Kong economy
Opinion
SCMP Editorial
SCMP Editorial

EditorialHong Kong must diversify and adapt to changing tourism market

Amid shifting cross-border travel and spending patterns, local businesses face challenging times as more residents leave the city during holidays

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Tourists pack the Avenue of Stars in Tsim Sha Tsui on April 5 during the Easter holiday weekend. Photo: Eugene Lee
SCMP Editorial
Notwithstanding the unsettling global environment, the Easter holidays remain a top travel season in many parts of the world. As Hongkongers took advantage of the consecutive Ching Ming Festival this year to head north and overseas, the city was also trying to attract more high-spending foreign visitors. The extended holidays are as much a test of our strategic shift towards high-value tourism as our ability to adapt to changing cross-border integration.

Immigration data showed the number of foreign visitors remained steady at around 121,000 in the first three days when compared with the same period last year. Mainland arrivals continued to grow this year, up more than 15 per cent from around 287,000 to more than 331,000 during the period.

Unlike the Spring Festival or the National Day “golden week”, Easter is not a public holiday on the mainland. However, many still venture out when the Ching Ming Festival enables a long weekend, as reflected in the surge in southbound arrivals. The outflow here is more significant, with local residents making more than 1.7 million departures in the first three days of the five-day holiday, up 6 per cent from the same period last year. High-speed rail travel has been especially popular as people opt for safe and affordable options amid regional military conflicts and rising airfares.
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According to one industry representative, the catering sector registered an estimated 6 to 7 per cent drop in business over the long weekend. Attributing the decrease to the exodus, some businesses said they could only count on upcoming mega-events and the Labour Day “golden week” next month to cover some lost ground.

These shifting cross-border travel and spending patterns could intensify in the foreseeable future. As local hotels, restaurants and retailers seek to tap tourist dollars with more promotions during prime travel seasons, the pie could shrink as more locals venture abroad. This trend is not new, but it underscores the negative impact on the city’s economy and the need for businesses to compete with a wider cross-border market.

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The tourism industry must also adapt and innovate. The city has leaned heavily on mainland visitors for too long following the introduction of the individual visit scheme in 2003. Gradually and rightly, tourism promotions are pivoting towards markets such as Southeast Asia, Europe and the Middle East, where visitors tend to stay longer and spend more. The 8 per cent year-on-year increase in overseas visitors to more than 2 million in the first two months is a good start. The city should continue to strengthen its offerings for a more diversified market and adjust its strategy amid an increasingly volatile tourism market fuelled by intensifying geopolitics.

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