18 May 2018
The recent development of Hong Kong tourism industry and its outlook
Tourism is one of the four pillar industries in Hong Kong. Since the implementation of individual visitor scheme in July 2003, the rapid development of tourism industry has become one of the driving forces for both the economy and employment market of Hong Kong. The economic value-added and employment of the tourism sector reached HK$112.4 billion and 259,800 in 2016 respectively, amounting to 4.7% of the GDP and 6.8% of the total employment. However, the spending pattern of Mainland tourists has undergone a consolidation phase since 2014, together with the keen competition from other tourist destinations, rapid development of online shopping platforms, subdued economic growth globally and relatively strong Hong Kong dollar exchange rate, Hong Kong tourism industry entered into a period of correction. After more than three years of correction, Hong Kong tourism industry has recovered gradually and accelerated further in Q1 2018, though it is not expected to enter into another rapid development phase. Going forward, Hong Kong could leverage on the upcoming completion of the cross-border infrastructures to enhance the attractiveness and competitiveness of the tourism industry.
1.The characteristics of recent tourism recovery
After three years of correction, Hong Kong tourism industry is now recovering. The number of visitor arrivals is increasing gradually again, with the Chinese, Northeast and Southeast Asian tourists as the main growth drivers. However, the overall tourism revenue has yet returned to its peak in the past few years.
Overall visitor arrivals increased again. Since the implementation of individual visitor scheme in July 2003, Hong Kong tourism industry recorded remarkable growth. The overall visitor arrivals reached a historic high of 60.84 million in 2014 after recording an annualized growth of 15.5% for five years. The visitor arrivals then declined 2.5% and 4.5% in 2015 and 2016 respectively, and recovered by 3.2% in 2017, but it was still 3.9% lower than its peak in 2014. In Q1 2018, the number of visitor arrivals accelerated further to 9.6% growth year-on year.
Overnight visitor arrivals recorded relatively solid rebound. Among all the visitors, the number of overnight visitors, who have higher spending, reached 27.77 million in 2014, accounting for 45.6% of the total. The overnight visitors declined 3.9% and 0.5% in 2015 and 2016 respectively. It then recovered more notably by 5.0% in 2017 and surpassed the 2014 record to 27.88 million. In Q1 2018, overnight visitor arrivals also recorded relatively solid growth of 7.2%.
Mainland visitors continued to be the main driver of visitor growth. Over the past decade, the Mainland is the most important source market for visitor growth. In 2017, the number of Mainland visitor arrivals reached 44.45 million, accounting for 76% of the total. Its growth rate was faster than the overall average at 3.9% in 2017, while that from the rest of the world increased 1.1% only. In Q1 2018, the growth of Mainland visitors continued to outpace the overall market at 12.6% year-on-year, 3 percentage points higher than the overall average. Similarly, the number of overnight Mainland visitors increased by 6.7% and 10.5% in 2017 and Q1 2018 respectively, 1.7 and 3.3 percentage points higher than the overall overnight visitors growth.
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