Hong Kong Visitor Arrivals pass 10 Million mark

Hong Kong visitor arrivals passed the 10 million mark at the year’s halfway stage for the first time, totalling 10,012,618 from January to June 2004. This is 68.3% ahead of the same period in 2003, almost 10 percentage points clear of the Hong Kong Tourism Board’s (HKTB) half-year growth forecast of 58.6%.

This achievement follows another strong performance in June when Hong Kong welcomed 1,646,530 arrivals, the highest June figure on record. This represents a 127.0% increase on the June 2003 result, when Hong Kong was still listed as a Sars-affected area, and 40.2% growth on the June 2002 figure, which provides a more meaningful benchmark as 2002 was a record year for the industry.

HKTB Executive Director Clara Chong commented that the six-month performance was highly encouraging on a number of fronts. “Firstly, we are now seeing steady growth across almost all markets, both long-haul and short-haul,” she explained. “We had not expected the three long-haul markets to regain their 2002 levels until the third quarter of the year, but all of them have already now achieved that. Even Japan, though it has not yet returned to 2002 levels, is making more progress every month and has exceeded our half-year targets.

“Secondly, we were not expecting to pass the 10 million milestone until sometime in July,” Ms Chong added. “When you consider it was only in 1995 that we reached 10 million arrivals in a full year for the first time, it is really a remarkable achievement to reach the same landmark within half that time just nine years later.”

“Last but not least, this result keeps Hong Kong well on track to reach its goal of 20.5 million arrivals for the full year, which would be another important milestone. Arrivals in the second half of the year are always a little higher than in the first, so we are reasonably confident of achieving this aggressive target, so long as no unforeseen external factors arise.”

Analysis by Markets, June and first half of 2004

June is traditionally one of the quieter months for Hong Kong tourism and this year’s total of 1,646,530 visitor arrivals surpasses the previous best June figure, recorded in 2002, by more than 470,000. The cumulative January to June total of 10,012,618 also sets new records, representing 68.3% growth over the same period in 2003 and 33.4% growth over the 2002 figure.

Mainland China was again the largest contributor with 867,445 June arrivals, increases of 84.3% and 104.7% respectively over the same months in 2003 and 2002. Several major trade shows staged in Hong Kong during June, including ITE Hong Kong, Asia’s Fashion Jewellery & Accessories Fair and the June Hong Kong Jewellery & Watch Fair, helped stimulate business traffic from this market, while leisure travel continued to benefit from the Individual Visit Scheme. Some 266,791 Mainland visitors during the month, 30.8% of the total, arrived as individuals from the 23 cities where this scheme had by then come into operation. Since 1 July, a further nine cities in Fujian, Zhejiang and Jiangsu provinces have been added.

For the first six months of 2004, Hong Kong has now welcomed 5,668,131 Mainland visitors, a 75.2% increase over the first six months of 2003 and a 96.5% increase on the same period in 2002. This includes 1.60 million arrivals under the Individual Visit Scheme, 28.3% of the Mainland total.

June arrivals from The Americas regained their 2002 levels for the first time in four months, totalling 118,090 which is 304% above the June 2003 figure and 7.4% ahead of the 2002 result. Arrivals from the United States improved by 8.9% on the June 2002 performance and those from Canada by 14.9%. Consumer sentiment to travel overseas is picking up in the US, while awareness of Hong Kong has been increased by several recent major features on the destination in popular travel publications. Cumulatively, arrivals from The Americas in the first six months are 81.3% above the same period in 2003 and a modest 1.9% below those for 2002.

Arrivals from Europe, Africa & the Middle East continue to show steady growth over 2002 levels with June arrivals reaching 88,305, improvements of 179% and 3.7% respectively over the same months in 2003 and 2002. The United Kingdom (+13.2% ahead of June 2002) again led the way, boosted by an increase in air capacity, while among the smaller markets, South Africa (+43.5%) maintained its encouraging steady growth. For the first six months of 2004, total arrivals from this region are 80.4% ahead of the same period in 2003 and 8.2% above those of 2002.

Australia, New Zealand & South Pacific region is also showing steady positive growth and recorded 41,775 June arrivals, a 257% increase on June 2003 and 28.4% increase on the 2002 figure. For the first six months of 2004 overall, arrivals stand at 80.6% ahead of those for 2003 and 10.9% above 2002.

South & Southeast Asia produced its strongest performance so far this year with 186,500 June arrivals, 281% more than in June 2003 and 18.9% ahead of the 2002 figure. Thailand (+41.5%), Singapore (+27.4%), Malaysia (+24.5%) and India (+19.1%) all showed significant growth compared with June 2002, due in part to some highly attractive air fares and packages on offer. Total arrivals for this region in the first six months of 2004 now stand at 95.8% ahead of the same period in 2003 and 5.1% ahead of 2002.

Arrivals from North Asia totalled 129,827 in June, 261% above the June 2003 figure but 6.8% below that of 2002. South Korea (+36.3% compared with June 2002) continues to show strong positive growth while arrivals from Japan (–18.8%) remain below 2002 levels, although the gap has steadily narrowed by some 20 percentage points since the start of this year. For the first six months of 2004 overall, arrivals from this region show a 36.8% increase on the equivalent period in 2003 and a 19.4% decrease on the 2002 result.

June arrivals from Taiwan were 170% above the figures for June 2003 at 174,396. Although this is still 4.2% below the June 2002 result, it is comfortably the strongest performance from Taiwan this year, indicating that a recovery is gathering momentum in this market, which has seen outbound travel to all destinations affected by political and economic concerns. Hong Kong is particularly affected by such trends as it is a major hub and transit point for travel between Taiwan and other regional or international destinations. Taiwan remains Hong Kong’s second largest source market with 982,768 arrivals in the first six months of 2004, an increase of 38.2% on the same period in 2003 but a decrease of 15.5% on the 2002 figure.

Same-Day In-Town Visitors

In June, 60.7% of all visitors stayed one night or longer, a significant improvement on the 55.2% in June 2003. The remaining 39.3% were classified as “same-day in-town” visitors, departing for another destination on the same day as arrival.

Most longer-haul visitors stayed for one night or more, notably those from Australia, New Zealand & South Pacific (79.0%) and The Americas (78.2%), while 78.4% of all visitors from South & Southeast Asia also did so. On the other hand, only 25.3% of Taiwan visitors stayed overnight, as many visitors from this market are in transit to/from Mainland China or other regional destinations. For the first six months of 2004, 62.3% of all visitors have stayed for one night or more, compared with 61.0% for the same period in 2003.

Hotel Occupancy

Average occupancy rate across all categories of hotels and tourist guest houses in June was 86%, compared with only 34% in June 2003 when Hong Kong’s tourism industry was still being badly affected by the Sars crisis. However, it also compares very favourably with the June 2002 figure of 79%.

Hotels in the Yau Ma Tei and Mong Kok areas enjoyed an especially successful month, averaging 91% occupancy in June. The average achieved hotel room rate across all hotel categories and districts was HK$704, a 21.2% improvement on the June 2003 figure.

For the first six months of 2004, average occupancy now stands at 85%, compared with 54% for the same period in 2003 and 82% in 2002. The average achieved hotel room rate is HK$762, a significant improvement on the HK$654 recorded for this period in 2003 and HK$693 in 2002.

See also: Hong Kong Visitor Arrivals - May 2004.