Hong Kong plans HKD 380 million package to revive inbound tourism
The Hong Kong government is planning a range of measures to boost its flagging inbound tourism. The initiatives, expected to cost HKD 380 million in the government's latest budget, include waiving licence fees for local travel agents and hotels and expanding the scale of major events to be held this year.
The Hong Kong government is taking measures to support the city’s beleaguered tourism sector.
The city’s financial secretary John C. Tsang has introduced measures worth HKD 380 million in the 2016-2017 Budget to fund short, medium and long-term measures to boost its local tourism. The measures include waiving licence fees for local travel agents and hotels and expanding the scale of major events to be held this year.
“Tourism contributes 5% to our GDP and employs 270,000 people. It provides plenty of job opportunities. For some 10 years, tourism and other related industries have experienced rapid growth. The number of inbound visitors has increased to 60 million, four times that of 2003.” said Mr. Tsang. “[But] The local tourism industry is facing keen competition as a result of a weakening external economy, devaluation of currencies of neighbouring places and their relaxation of visa requirements for mainland tourists since last year. This, coupled with the ‘one trip per week’ measure for Shenzhen residents, has caused a drop in visitor arrivals.”
The number of inbound visitors in 2015 was 59.3 million, down by 2.5% YoY and mainland tourists were about 45.62 million, decreased by 2.9% YoY. The market has suffered a hit due to the slump of inbound visitors.
The decline was apparent in the city’s retail during the Golden Week for National Day holidays last year when the territory’s retail sales dropped sharply by more than 80% at the worst time. It has been the first time retail fell ever since the implementation of the mainland's Individual Visit Scheme in 2003.
Mr. Tsang said that the government will launch short- to long-term measures to reduce the industry's costs of operation and enhance Hong Kong's attractiveness and competitiveness.
The three short-term measures, costing a total of HKD 140 million, for related trades and industries include:
(a) Waive the licence fees for 1,800 travel agents for one year;
(b) Waive the licence fees for 2,000 hotels and guesthouses for one year; and
(c) Waive the licence fees for restaurants and hawkers and fees for restricted food permits for one year, benefiting 27,000 restaurants and operators.
In the medium term, Mr. Tsang will allocate HKD 240 million for government and the industry to jointly launch five measures such as expanding the scale of major events, re-positioning Hong Kong's tourism image with new promotional videos and promotion of shopping and spending.
Read the Budget Speech