HONG KONG. Arrivals by Mainland Chinese grew by +2.2% in July – the first year-on-year increase in 13 months.
The figures will be welcomed by Airport Authority Hong Kong as it prepares to issue its core category retail concession tenders later this year. Mainland Chinese made up 75.2% of all arrivals to Hong Kong in the first half of 2016 and are critical to the fortunes of DFS (core category retail incumbent at Hong Kong International Airport) and other travel and domestic retailers.
For the first six months, Mainland Chinese arrivals were down by a worrying -10.6% to 20,415,710.
Tourism Board Chairman Peter Lam Kin-ngok said that anti-Mainlander sentiment from Hong Kong Chinese has eased, helping to drive a fledgling but encouraging recovery. Other positive factors include the strengthening of the Yen, making Japan a less attractive destination, and an easing of multiple-entry permit restrictions. Terrorism fears related to Europe are also encouraging tourism closer to home, Lam added.
Sheer numbers are one indicator but spending patterns are a more important one for retailers. For the first six months, per-person spending by Mainland Chinese in Hong Kong fell by -15.8% year-on-year.
Is a recovery under way? It’s way too early to say but it’s certain that Airport Authority Hong Kong and the many likely bidders for its retail concessions will be modestly encouraged by today’s news.
