Policy solution. Travel Industry Salvation｜“Old-fashioned” financial support can only be “hanged” and cannot be “activated”

The novel coronavirus pneumonia epidemic has lasted for more than two years. The tourism industry has been frozen as early as 2020, and the GDP has dropped from 4.5% in the past to only 0.4%. Although the SAR government has provided financial support of 3.42 billion yuan to the industry, But not too much atmosphere.

At the time of life and death, the Financial Secretary, Paul Chan, earmarked $1.26 billion in the latest Budget to "revitalize the tourism industry". The measures include encouraging the industry to launch cultural, heritage, green tourism, and external promotion; however, Not to mention that the subsidy of more than 1 billion yuan is only a drop in the bucket, and it is futile to talk about publicity activities at this stage. The SAR government has no determination and courage to change the structure of tourist sources and tourism patterns. How can we revive it?

More than two years after the outbreak of the epidemic, Hong Kong's tourism industry has been suspended for a long time.

(Photo by Wu Zhongkun)

In addition to financial assistance or financial assistance

Tourism, one of the traditional four pillars, has suffered repeated setbacks in the past three years.

Affected by the turmoil of the anti-amendment bill in 2019, the proportion of the gross domestic product (GDP) of the tourism industry fell from 4.5% in 2018 to 3.6%, or 98.6 billion yuan; Reduced to only 0.4% in 2020, or 9.3 billion yuan.

The direct reason for the sharp drop in output value is that the social unrest and the public health crisis have led to a significant decrease in the number of tourists visiting Hong Kong, from 65.15 million in 2018 to 55.91 million in 2019, and then plummeting to 3.57 million in 2020. There were only 91,000 people last year.

Before the "three-year losing streak", the tourism industry in Hong Kong had two characteristics: first, the source of tourists mainly came from other places, especially the mainland;

However, since Hong Kong and the mainland have not yet implemented the "customs clearance" measure of two-way quarantine exemption, and given the severe epidemic situation overseas, Hong Kong has not dared to relax the quarantine policy for overseas tourists entering the country.

When there are no tourists, the retail, accommodation, and catering industries that rely on their consumption and shopping have all been hit hard, and many merchants have closed down. In February 2020, at the initial stage of the first wave of the epidemic, Granville Road in Tsim Sha Tsui was close to 30% of the stores are vacant, and 150 stalls in Ladies Market are closed on weekends. During the fourth wave of outbreaks in November 2021, the vacancy rate of stores in the five core consumer areas of Central, Tsim Sha Tsui, Wan Chai, Causeway Bay and Mong Kok continued to be high. They are 20.66%, 17.15%, 14.83%, 11.65% and 9.09% respectively.

The entire tourism industry has fallen into a "frozen" state, and the employed population has also decreased from 257,000 in 2018 to 231,000 in 2019, and then to 48,600 in 2020, a record low.

In the face of operational difficulties, the SAR government said that it has "always supported the industry through different methods", and the main approach is to provide financial support of 3.42 billion yuan, including: (1) Provide operating allowances to licensed travel agents, with the following 10 staff members Distribute 100,000 yuan, and more than 10 people will be calculated as 10,000 yuan per person; (2) Distribute 15,000 yuan and 6,700 yuan allowances to agents, tour guides, tour leaders, tour bus drivers and other practitioners; According to the number of tourists received by travel agencies, each tourist will be provided with incentives of 100 yuan for outbound, 120 for inbound, and 200 for local.

Despite this, the Secretary for Commerce and Economic Development, Mr Edward Yau, revealed at a meeting of the Economic Affairs Committee of the Legislative Council last month that out of the original 1,700 registered travel agents in Hong Kong, about 100 have closed due to the impact of the epidemic, but there are still many The travel agency maintains its business registration and waits for a restart after the "cold winter".

However, the fifth wave of the epidemic is quite severe. I don't know what year and month this "cold winter" will last. The Financial Secretary, Paul Chan, released his last "Budget" last Wednesday (February 23). , continue to use the "financial support" approach, set aside 1.26 billion yuan for the development of tourism, of which 600 million yuan is set up for a three-year "cultural heritage local tourism incentive plan", and continue to support the "green living local tourism incentive plan"; 600 million yuan will support the HKTB to revitalize the tourism industry and carry out the work of the Ministry of Culture and Tourism of the People's Republic of China to issue the "Guangdong-Hong Kong-Macao Greater Bay Area Culture and Tourism Development Plan"; the remaining 60 million yuan will support the training of tourism practitioners.

The new crown pneumonia epidemic has affected the global tourism industry. Morning Star Travel announced its automatic liquidation on the evening of January 27, and the store will no longer be open for business on January 28.

(Photo by Yu Junliang)

"Hanging Your Life" cannot "Activate Industry"

I have to say that with such a "financial budget", I really don't know how to consolidate Hong Kong's position as an international urban tourism hub, let alone how to make Hong Kong a "Sino-foreign cultural and artistic exchange center" that the country has high hopes for!

First of all, the industry is stagnant, and although it needs the support of the SAR government, the authorities are just repeating the old tricks of some of the existing incentive programs, publicity and personnel training, and I am afraid they are just "hanging their lives".

Taking Singapore’s tourism policy as an example, the local government has launched Singapore Rediscovers Vouchers, allowing each Singapore permanent resident to receive SGD 100 (ie HKD 570) to purchase tickets for local tourist attractions, tour itineraries and pay for hotels, etc. .

This measure can encourage citizens to actively participate in local tourism, so that local tourism activities will not come to a standstill, and the associated consumption effect can also promote economic development.

On the other hand, even though the SAR government distributed 5,000 yuan of electronic consumption coupons to each adult citizen last year, it did not stipulate that the relevant funds must be used for tourism activities, such as museums, theme parks, historical sites, etc., and this year will increase to 1 per person. 10,000 yuan, but also failed to achieve "precise assistance", naturally unable to activate the tourism industry.

Second, in addition to helping the tourism industry regain its vitality, it should also start planning for the future.

In fact, the two characteristics of local tourism mentioned above—over-reliance on foreign tourists and shopping and consumption activities—has hardly gained new impetus, and to some extent even become a “stumbling block” for the sustainable development of the tourism industry.

Because of this, the SAR government needs to take advantage of the "winter in the tourism industry" to make structural adjustments, actively explore new tourism models in the future, and at the same time change the "high volume and low value" pattern of over-reliance on foreign tourists in the past.

However, before structural reorganization, we should first understand the causes of the existing structure, in order to prescribe the right medicine.

Hong Kong 01 Cartography

Check the "cause of death" to be "reborn"

When SARS broke out in Hong Kong in 2003, the tourism industry bore the brunt. From April to June of that year, there were only 1.65 million tourists visiting Hong Kong, a 57.9% drop from the same period in 2002.

The then Chief Executive, Tung Chee-hwa, and the Financial Secretary, Leung Kam-sung, communicated with the industry in a timely manner, launched a promotion plan, opened up new attractions, and opened the Mainland for "Hong Kong and Macau Individual Travel" (independent travel).

The number of visitors to Hong Kong increased from 15.54 million in 2003 to 54.3 million in 2013 (see table below), marking a golden age for the industry during that decade.

However, this "brilliancy" has also brought about a dramatic change in the structure of Hong Kong's tourism industry. In 1997, mainland tourists accounted for 21% of Hong Kong's total tourists. After the handover to 2002, the proportion of mainland tourists has gradually increased to 41%. %, and then jumped to 55% in 2003, and was close to 80% in 2018.

Hong Kong has a close relationship with the Mainland, and it is natural that the tourism industry is inclined to the Mainland market. The problem is that Hong Kong is not attractive to Mainland tourists except for shopping and consumption.

According to a document by the Legislative Council Secretariat, 86% of mainland tourists in 2016 had shopped, while only 7% and 3% visited cultural attractions and green fields.

According to statistics from Wang Chunxin, head of economic and policy research at BOC Hong Kong in 2016, the shopping value of tourists visiting Hong Kong in 2003 was only 33.5 billion yuan, but in 2014 it had soared to 197.2 billion yuan, driving the total retail sales value in Hong Kong to increase from 172.9 billion yuan to 494.5 billion yuan.

According to his calculations, in the past 11 years, tourist shopping contributed 51.1% to Hong Kong's retail growth, that is, providing more than half of the retail growth momentum.

The industry has found a way to make money and has become more reliant on this consumption-shopping-based tourism model. The problem is that the SAR government is also passive, completely ignoring the precarious structural crisis.

First of all, Hong Kong benefits from tax incentives as an independent customs territory and convenient trade relations. It is famous for its wide range of products, reasonable prices and quality assurance, attracting Chinese and foreign tourists to visit here; however, with the advancement of globalization and the country’s foreign trade With the opening of the Internet and the maturity and prosperity of online shopping services, the price difference between Hong Kong and overseas and the mainland is narrowing, and the advantages of "shopping paradise" are also narrowing.

For example, the research report "Journey to the Future: A Review of the Highs and Lows of Hong Kong's Tourism Industry in the Past 20 Years" published by the Bauhinia Research Center in October 2020 pointed out that between 2014 and 2019, the total amount of "shopping" by overnight visitors did not rise but fell. , fell more than 50% from 136.45 billion yuan to 65.67 billion yuan.

In-depth tours aimed at local humanistic feelings are exactly what Hong Kong's tourism industry needs.

(Photo by Lin Ruoqin)

Both "material consumption" and "spiritual enjoyment"

Secondly, this model has created a large number of "low-end" service populations engaged in retail, catering and accommodation industries, accounting for about 15% of Hong Kong's total employed population, but their median salary is only 13,000 yuan, which is lower than that of those engaged in finance, real estate, The 27,000 yuan in insurance and other industries is much lower, which can be described as "high volume and low value".

Chen Zongcheng, research assistant professor of geography and resource management at the Chinese University of Hong Kong, criticized in an interview with "Hong Kong 01" in the past that "high volume and low value" can only bring short-term economic returns to Hong Kong, but it does not add value to other aspects of Hong Kong, or even May limit the long-term development of society.

He explained that if a city relies on a certain tourism theme and product for a long time, once the demand for such products falls or is affected by other external factors that are difficult to control, the tourism industry will be hit hard, and the city may suffer from a lack of sufficient Flexibility or resilience to respond in a timely and effective manner, leading to a rapid decline in the tourism industry and the local economy, is definitely not a healthy phenomenon.

Lastly, when the SAR government aggressively opened up mainland tourists to Hong Kong for consumption, it not only underestimated the public's psychological capacity, but also failed to expand space, add supporting facilities and adjust supply in response to demand, resulting in crowds everywhere and rising prices, affecting the daily life of Hong Kong people and causing a lot of consequences. The "land-Hong Kong conflict" not only hurts the feelings of the people of the two places, but also undermines the mutual trust between the central and Hong Kong ports.

After examining the "cause of death" of the tourism industry, a structural "major surgery" should be carried out accordingly, and the next thing that needs to be answered is - in addition to a bunch of glamorous turnover and GDP, "the tourism industry" "What does it really mean for a city?

In addition to a dazzling array of commodities and delicacies that combine Chinese and Western food, what kind of humanistic experience and spiritual enjoyment do we hope to leave for the people who come here?

Local tours, green tours, cultural tours, and in-depth tours are all in the right direction. However, if the government lacks an overall tourism policy and an integrated industrial policy, the Chief Executive Carrie Lam Cheng Yuet-ngor alone can set up a "Culture, Sports and Tourism Bureau", or simply rely on the reservation of Chen Maobo. The mere billion-dollar "old-fashioned" financial subsidy thinks that a market that is dying can naturally develop new tourism products, I am afraid it is just a dream!