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Download - Hong Kong Institute of Certified Public Accountants

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Tourism<br />

Awkward arrivals<br />

The sharp increase in Mainland tourists has come at a social<br />

price, in the eyes <strong>of</strong> many <strong>Hong</strong> <strong>Kong</strong> residents.<br />

Some <strong>Hong</strong> <strong>Kong</strong>ers criticize Mainlanders’ personal habits,<br />

such as eating on public transport. Even worse incidents occur:<br />

Last year, Mainland parents were photographed letting their<br />

child defecate in a public area <strong>of</strong> the Harbour City shopping<br />

mall in Tsim Sha Tsui, a popular shopping destination for Mainland<br />

visitors.<br />

In January, tensions were raised when a photographer<br />

claimed that security guards at the Dolce & Gabbana store in<br />

Harbour City stopped him from taking a picture <strong>of</strong> the shop’s<br />

window displays. He said store employees told him that only<br />

people from the Mainland and foreign tourists were allowed in<br />

the store.<br />

To be fair, some <strong>Hong</strong> <strong>Kong</strong> people have been insensitive in<br />

return, confronting and shouting at tourists, chanting <strong>of</strong>fensive<br />

slogans or singing songs about “locusts,” a derogatory term for<br />

Mainland Chinese who travel in large groups.<br />

Businesses that by and large welcome Mainland tourists<br />

can also tick <strong>of</strong>f a few problems, ranging from queue jumping<br />

and haggling in fixed-price stores to shoplifting and the pr<strong>of</strong>fering<br />

<strong>of</strong> counterfeit money.<br />

Indeed, retailers would find it hard to live without them.<br />

Marcella Chow, an economist at Bank <strong>of</strong> America-Merrill<br />

Lynch, estimates that Mainland tourists' spending made up<br />

about 23.4 percent <strong>of</strong> total retail sales in 2011.<br />

Some authorities have expressed concern that many crossborder<br />

visitors are actually importers <strong>of</strong> consumer goods,<br />

seeking to avoid paying Mainland duties. For some retailers,<br />

Airlines). The move comes in the face <strong>of</strong><br />

growing rivalry from budget carriers – Australian-owned<br />

Jetstar is set, subject to regulatory<br />

approval, to launch in <strong>Hong</strong> <strong>Kong</strong> next<br />

year in a joint venture with China Eastern<br />

Airlines.<br />

<strong>Hong</strong> <strong>Kong</strong> Airlines also hopes to add new<br />

aircraft to its fleet in the next two years in a<br />

bid to broaden its range <strong>of</strong> destinations. It began<br />

flying from <strong>Hong</strong> <strong>Kong</strong> to Hohhot, Inner<br />

Mongolia, in September.<br />

Diverse attractions<br />

<strong>Hong</strong> <strong>Kong</strong>’s accommodation sector is also<br />

gearing for a continued increase in the number<br />

<strong>of</strong> tourists. According to a forecast by<br />

Business Monitor International, a Londonbased<br />

consultancy, about 8,000 new rooms<br />

will be added to <strong>Hong</strong> <strong>Kong</strong>’s hotel capacity<br />

between now and 2016, increasing the total<br />

by about 11.5 percent to 77,000 rooms.<br />

A challenge for industry pr<strong>of</strong>essionals is<br />

38 December 2012<br />

keeping tourists in <strong>Hong</strong> <strong>Kong</strong>, rather than<br />

have them move on to Macau or other destinations.<br />

“As <strong>Hong</strong> <strong>Kong</strong> is developing itself<br />

“ I don’t see any<br />

signs showing<br />

that <strong>Hong</strong> <strong>Kong</strong> is<br />

over-reliant on the<br />

China market.”<br />

to be a hub for multi-destination travel, more<br />

efforts need to be made to impress visitors,”<br />

says Matthias Li, deputy chief executive <strong>of</strong><br />

Ocean Park and an <strong>Institute</strong> member.<br />

“A portion <strong>of</strong> Mainland tourists have already<br />

made several visits to <strong>Hong</strong> <strong>Kong</strong>, and<br />

would now look beyond the typical attractions<br />

and seek more novel experiences that<br />

would depict local culture and heritage,”<br />

Li adds, citing examples such as the Tai O<br />

parallel importers are a non-issue. “End users make up absolutely<br />

the majority <strong>of</strong> our customers,” says Guy Look, a <strong>Hong</strong><br />

<strong>Kong</strong> <strong>Institute</strong> <strong>of</strong> CPAs member and chief financial <strong>of</strong>ficer <strong>of</strong><br />

Sasa International Holdings, which operates cosmetics stores<br />

throughout <strong>Hong</strong> <strong>Kong</strong> and the Mainland.<br />

Most retailers would like to see more tourists arrive in <strong>Hong</strong><br />

<strong>Kong</strong>. But the question is, how many is too many? The <strong>Hong</strong><br />

<strong>Kong</strong> government is proceeding cautiously with a plan to make<br />

it easier for 4.1 million non-permanent residents <strong>of</strong> Shenzhen<br />

to enter <strong>Hong</strong> <strong>Kong</strong> on multi-entry permits.<br />

Chief Executive Leung Chun-ying said in October that the<br />

plan would not take effect until both Chinese and <strong>Hong</strong> <strong>Kong</strong><br />

authorities have confirmed that the city has the capacity to<br />

handle so many potential visitors. "The [postponement] is<br />

mainly to ensure the healthy development <strong>of</strong> <strong>Hong</strong> <strong>Kong</strong>'s tourism<br />

and to minimize the impact on <strong>Hong</strong> <strong>Kong</strong> residents' livelihoods,”<br />

Leung said, citing concerns registered by residents <strong>of</strong><br />

the northern New Territories, closest to Shenzhen.<br />

<strong>Institute</strong> members, many <strong>of</strong> whom are in sectors that count<br />

on Mainland visitors, are concerned about tensions. “We, as<br />

<strong>Hong</strong> <strong>Kong</strong> residents, could do more by <strong>of</strong>fering our warmest<br />

hospitality and patience to our guests from the Mainland,” says<br />

Philips Ng, finance manager at <strong>Hong</strong> <strong>Kong</strong> Airlines.<br />

Moreover, Mainland tourists could easily decide not to go<br />

where they’re not made to feel welcome. “I’m not sure that<br />

tourists from the Mainland will continue to consider <strong>Hong</strong> <strong>Kong</strong><br />

as their first priority,” says Clement Tsang, regional finance director<br />

for LVMH Moët Hennessy Louis Vuitton in <strong>Hong</strong> <strong>Kong</strong><br />

and an <strong>Institute</strong> member. “They may move on.”<br />

fishing village on Lantau, the annual bun<br />

festival on Cheung Chau and <strong>Hong</strong> <strong>Kong</strong><br />

Global Geopark in the northeastern New<br />

Territories.<br />

“I don’t see any signs showing that <strong>Hong</strong><br />

<strong>Kong</strong> is over-reliant on the China market,”<br />

he says. “The 70 percent, in my opinion,<br />

simply demonstrates the huge population in<br />

a single market who are interested in <strong>Hong</strong><br />

<strong>Kong</strong>, which is something that we should be<br />

proud <strong>of</strong>.”<br />

To be sure, other countries are registering<br />

increased interest in <strong>Hong</strong> <strong>Kong</strong>. More<br />

tourists from Korea and the Middle East<br />

are arriving, while the other “BRIC” countries<br />

– Brazil, Russia and India – are among<br />

source markets with enormous room for<br />

growth, according to the <strong>Hong</strong> <strong>Kong</strong> Tourism<br />

Board. “I’m confident that <strong>Hong</strong> <strong>Kong</strong> is<br />

already working hard to entice these visitors<br />

to choose <strong>Hong</strong> <strong>Kong</strong> as their next destination,”<br />

says Li.

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