Hon YIU Si-wing, SBS (Tourism)

Opening Speech of Secretary for Commerce and Economic Development

SECRETARY FOR COMMERCE AND ECONOMIC DEVELOPMENT (in Cantonese): President, since 2015, various sectors of society have showed concern about the decreasing number of visitor arrivals and the slowdown in tourist spending, as well as widespread debate over the development of Hong Kong's tourism industry. This is also the issue of gravest concern to colleagues of the Tourism Commission and the Hong Kong Tourism Board ("HKTB") and I.

I think Members present at the meeting and the community at large would agree that the development of tourism should not emphasize quantity over quality. A blind pursuit of rapid growth in the number of visitors is not only unrealistic, but will also bring about various problems such as the receiving capacity of the community.

Hong Kong's tourism industry has, since 2004, experienced 10 years of rapid growth, with total visitor arrivals reaching as high as 60 million in 2014, nearly four times that of 2003. This has nonetheless led to a public debate on Hong Kong's receiving capacity. In recent years, a number of external factors, including subpar global economic growth and intensifying regional competition posed by neighbouring tourist destinations as a result of the depreciation of their currencies, have affected our tourism industry and prompted it to enter a period of consolidation. Meanwhile the "one trip per week" measure for Shenzhen residents implemented since April 2015 that took into account the receiving capacity of individual districts in Hong Kong and the development direction of attracting more overnight visitors have expectedly resulted in a drop in the number of same-day Mainland arrivals. The unfortunate incidents involving coerced shopping to Mainland group tours also caused some impact on visitor arrivals.

As for visitor arrivals, the number has fallen by 4.5% in 2016 over that in the previous year, mainly because subsequent to the change of the endorsement arrangement from "multiple entry" to "one trip per week" for Shenzhen residents, his type of visitors (mainly same-day Mainland visitors) has dropped by 30%, thereby bringing a reduction in the number of Mainland visitors by 6.7%. Although non-Mainland visitor arrivals recorded an increase of 3.1%, the fact that Mainland visitors account for about 75% of total visitor arrivals has led to an overall reduction in the number of visitor arrivals.

In face of the above environmental changes and challenges, the Government has adjusted the strategy and direction of the development of tourism since 2015. At present, it is our policy objective to pursue a balanced, healthy and long-term development towards product diversification and high value-added services. We will strive to attract high-spending overnight visitors from various source markets to Hong Kong, with a view to maintaining a diverse visitor portfolio, increasing the economic benefits brought by visitors and creating a more healthy and sustainable room for development for Hong Kong's tourism industry.

Over the past year, we have allocated additional resources to HKTB to step up promotion efforts in various source markets, enhanced the scale of mega events, provided subsidy to promote Meetings, Incentive Travels, Conventions and Exhibitions―mentioned by a number of Members earlier―and "fly-cruise" tourism, as well as promoted Hong Kong's natural scenery and unique history and culture. These measures precisely coincide with those suggested by Members.

Through the efforts of the Government and the industry, these measures have begun to bear fruits and visitor arrivals have rebounded in recent months. In the fourth quarter of 2016, the total visitor arrivals to Hong Kong registered a slight increase of 0.4% year-on-year, which has improved notably from the fall of 10.9% in the first quarter of 2016 and ended the continuous decline of five quarters since the third quarter of 2015. As we entered 2017, total visitor arrivals has increased by 1.4% year-on-year for the first two months, in which both the number of Mainland and non-Mainland visitors have increased, reflecting that Hong Kong is still pretty attractive as a tourist estination.

While we hope this good momentum in early 2017 can be maintained, the tourism industry is still expected to face some uncertainties in the year to come. I will listen to the views expressed by Members during today's debate, and pool collective wisdom for the Government and the tourism industry to ponder how we can promote comprehensive and healthy development of Hong Kong's tourism industry, so that while we give impetus to our economy, we can also strike an appropriate balance between visitor receiving capacity and the maintenance of social harmony and stability.

President, I will make a concluding speech after listening to the views expressed by Members on this motion. Thank you, President.