Provisional Legislative Council
Economic Services Panel

Government ' s Policy to Promote Tourist Industry


This paper gives an overview of the latest state of play of our tourism performance, an account of the Government's policy and measures to promote tourist industry, as well as an outline of some of the efforts by Hong Kong Tourist Association (HKTA) in promoting tourism.

Overview of Tourism Performance

2.Tourism has been growing steadily over the past en years. 1996 witnessed an extraordinary growth, with visitors arrival increased by 14.7% reaching a new record of 11.7 million. Our major markets include Japan, Mainland China and Taiwan, making up about 20%, 20% and 16% respectively of our total visitor arrivals in 1996. Travel and tourism receipts totalled over HK$104 billion, making the industry Hong Kong's top foreign exchange earner among all service industries. In terms of tourism receipts, Hong Kong ranked 8th in the world and Hong Kong is also the most popular tourist destination in Asia. Locally, the industry employs directly or indirectly some 12% of Hong Kong's workforce or about 360,000 people.

3.Turning into 1997, visitor arrivals became slacken. For the first eight months, visitors arrivals dropped by 4.5% as compared with the same time last year. The drop was most marked in July which was 35%. However, the decrease reduced to about 24% in August. The resultant tourism receipt for the first half of 1997 also dips by 2.9%.

4.The reasons for the recent slowing down in visitor arrivals were many folds. They include the depreciation of currencies of our key markets which weakens Hong Kong's attractiveness as a tourist destination, the demand brought forward as shown by the exceptional increase in the number of visitor arrivals in 1996 possibly as a result of the 'see Hong Kong before it changes' attitude, as well as the fading of the " 1997 appeal " and the mainland's temporary measures to regulate outbound travel to Hong Kong during the handover period.

Government's Policy on Tourism

5.The policy of the Government on tourism is to ensure that the development of our tourist industry is supported by adequate infrastructure and facilities. The aim is to ensure Hong Kong as one of the leading tourist destinations in the Asia Pacific region.

6.In particular, the Government will provide the institutional framework and appropriate financial support to encourage the long term development of the tourism industry. We shall also provide and develop the necessary infrastructure to cater for growth in tourism, as well as support the activities of the Hong Kong Tourist Association and assist the Association in the discharge of their statutory responsibilities.

Government's Measures to Promote Tourism

7.While the day to day promotion of tourism and responses to market rests with the Hong Kong Tourist Association, the Government focuses on the longer term development of our tourist industry so as to help to maintain our competitiveness as a popular tourist destination. Against this background various measures were adopted by the Government. To encourage hotel development, the Government agreed to raises the plot ratio for hotels to a level on par with commercial sites. In late last year, the Government also agreed to exclude the back-of-the-house functions (e.g. laundry facilities) which are integral to a hotel's operation from the floor area and plot ratio calculations. The Government also encouraged hotel development through special zoning.

8.To maintain Hong Kong's competitiveness, the Government will undertake a review on the manpower and training need of the tourism industry. We shall also implement a Travel Pass Scheme to speed up immigration clearance for frequent visitors.

9.In addition, we continue to provide substantial subvention to support the operation of the HKTA. For 1997/98, a recurrent subvention of HK$469.7 million was granted to the Association. Moreover, the Government also set up a HK$50 million Tourism Development Fund last year to finance feasibility studies on new tourist attractions like a Hong Kong Exposition, Film City Theme Park and Cruise Terminal, and to improve existing tourist facilities such as installing better signages and new interactive information kiosks. This year, the Government is also seeking to set up a HK$100 million International Events Fund to support the staging of about 50 international events in the coming 5 years, in order to promote Hong Kong as the Events Capital of Asia and to attract more visitors to come to Hong Kong. Apart from the above, the opening of the new airport next year will also help to remove a major constraint to tourism development.

Hong Kong Tourist Association's Effort

10.As the statutory body charged with the responsibility of promoting tourism, the Hong Kong Tourist Association has also done a lot in this regard. Major promotion programmes such as the " 100 Days of Wonders' campaign which covered the period from July through October, as well as the 5-year Spotlight Hong Kong Programme, which will feature a series of international events such as the Takarazuka Revue from Japan next year, were launched to promote Hong Kong and to keep us under global and regional limelight. The Association also organises a number of familiarisation visits to Hong Kong for media and travel trade representatives from our major markets to promote Hong Kong as well as to help clear any misunderstanding on Hong Kong. In addition, a special Task Force comprising representatives from the HKTA, the Government, as well as all sectors of the tourism industry has also been set up to identify problem areas and to consider future promotional strategy for Hong Kong. In the short term, the HKTA has launched the competitively priced " Great Saving - Great Time " winter promotion package to beef up our short-haul markets, particularly Japan, Taiwan, Korea and Southeast Asia.

11.Since one of the most hard-hit market at present is Japan, the HKTA has intensified its effort in promoting this market. Apart from the production of new video news release for Japanese TV stations, the number of featuring of Hong Kong specials on Japanese TVs has also been increased. Large scale familiarisation programmes for trade and media groups were also organised and the Association is also trying to expand the existing markets and explore new niche markets in secondary cities. It has also launched a celebrity endorsement programme to target the Japanese market in particular.


12.The Government is committed to maintaining Hong Kong's competitiveness as a tourist destination. We ' ll seek to set up the HK$100 million International Events Fund to help promote Hong Kong as the Events Capital of Asia. With the completion of the various studies under the Tourism Development Fund on new tourist attractions, the Government will carefully consider the findings of the studies to see if new attractions could be implemented to make Hong Kong an even more attractive place to visit. In terms of the general promotion effort, in the short run, the HKTA will launch a winter promotion to help boost tourism in Hong Kong. In the longer term, the special Task Force recently set up will identify problem areas and to consider future promotional strategy for Hong Kong. We hope that through these various efforts, Hong Kong will remain a competitive tourist destination.

Economic Services Bureau
October 1997