Caixin
Oct 10, 2019 05:29 AM
ECONOMY

Mainland Visitors to Hong Kong Fall to Lowest in 9 Years

Escalating social unrest in Hong Kong has scared away tourists, especially mainland visitors. Photo: VCG
Escalating social unrest in Hong Kong has scared away tourists, especially mainland visitors. Photo: VCG

China’s national holiday break in the first week of October is usually one of the busiest periods for Hong Kong tourism. But not this year.

Visitors were scared away by growing violence in the four months of mass protests in the city. Tourist arrivals in Hong Kong declined by more than 30% during this year’s Golden Week holiday, among which mainland visitors plunged by more than half to the lowest level since 2010, data from the Immigration Department shows.

The slump has hurt the retail and hospitality sectors and weighted on unemployment.

What started as peaceful mass protests in early June against a controversial but now-withdrawn extradition bill has escalated to street violence and a broader anti-government movement. More than 30 countries and regions, including the Chinese mainland, Japan and the U.S., have issued warnings about travel to Hong Kong.

During the first seven days of October, tourist arrivals in Hong Kong fell to 2.345 million. Less than one-third of them – about 672,000 – were from the mainland. That compared with 1.52 million mainland visitors during the same period in 2018, when tourists from mainland China account for 44.2% of the total.

The city received less than 20 mainland Chinese group tours each day of Golden Week, compared with about 200 such groups daily during the same period last year, said Timothy Chui Ting-pong, executive director of the Hong Kong Tourism Association.

The bleak Golden Week followed a slow summer, another traditionally busy season for Hong Kong tourism. Total tourist arrivals in Hong Kong fell by 39% in August from the same month in 2018, after a 4.8% drop in July, data from the Hong Kong Tourism Board showed. Visitors from mainland China declined 42% in August and 5.5% in July.

The collapse of tourism is causing a domino effect in the retail and hospitality industry, with retail sales falling 23% in August from a year ago, the biggest-ever drop in a single month, and hotel occupancy rates sliding to 66% from 94% in August 2018. Sales of jewelry and watches dropped 47% in August from a year ago.

Analysts at Bank of America Merrill Lynch said in a recent research report that they do not expect a turnaround in retail sales in the short term and are concerned about higher unemployment.

The city’s retail, hospitality and restaurant sectors employ about 600,000 people, 80% of whom are low-skilled workers. Financial Secretary Paul Chan said the labor market is facing increasing pressure.

The total unemployment rate in the retail, accommodation and food services sectors reached 4.6% at the end of September, higher than in the same month last year by 0.7 of a percentage point, and above the overall local unemployment rate of 2.9%, Chan said in a blog Sept. 29.

Many workers in tourism are self-employed, Chui from the Hong Kong Tourism Association said. When there is no job in the sector, these people can look for jobs elsewhere, so there haven’t been any big layoffs, he said.

Contact reporter Denise Jia (huijuanjia@caixin.com)

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