Hong Kong Visitor Arrivals for August 2004 pass 2 million mark

A new landmark was reached for Hong Kong’s tourism industry in August 2004 with visitor arrivals exceeding two million in a single month for the first time. This is the second month in a row that the record has been broken, following the 1.99 million arrivals achieved in July.

August’s total of 2,066,469 arrivals represents an encouraging 25.6% growth on the same month in 2003 – a fair benchmark of progress as for the first time since February, year-on-year comparisons are not significantly influenced by the “SARS factor”. By this time last year, Hong Kong had already made a V-shaped recovery from the impact of SARS; indeed, August 2003 was itself a record-breaking month.

Nearly 1.24 million of the August 2004 arrivals came from Mainland China, another new record. Nevertheless, the strong performance was reflected across all long-haul and short-haul markets, with all market regions except Taiwan showing double-digit growth.

August is always a strong month for leisure travel, coinciding with school summer holidays in many key markets, while a major attraction this year was the Hong Kong Tourism Board's, Hong Kong Shopping Festival, which started in late June and continued right through July and August. Total arrivals during the Festival period reached 4.34 million and at least HK$1.5 billion worth of retail and restaurant spending was generated.

 HKTB Executive Director Clara Chong said that further new records could well be set in the last quarter of the year which was always considered a “peak season” for Hong Kong. “We have the China National Day ‘Golden Week’ coming up at the beginning of October, and expect to welcome around 400,000 Mainland visitors during that 10-day travel period,” she noted. “In addition, October and November always see a lot of business traffic as many major conventions and exhibitions take place at this time. Then in December, we shall again be launching a major Hong Kong WinterFest promotion to draw family travellers from around the region.”

“Nevertheless, there are still a few markets such as Japan and Taiwan that have not regained their 2002 levels,” Ms Chong added. “We are making strong efforts to give Hong Kong a fresh new image in these markets with a series of trade and consumer promotions highlighting the city’s lesser-known attractions.”

Arrivals have now passed the 14 million mark in the first eight months of 2004, totalling 14,069,792. This is 58.4% ahead of the same period in 2003 and 35.6% ahead of the 2002 figure.

Analysis by Markets, August and January–August 2004

The 1,238,091 arrivals from Mainland China in August represents 30.9% growth on the same month in 2003 and sets a further new record for a single month, topping the 1.16 million Mainland arrivals in July. Some 579,808 of the visitors – 46.8% of the total, the highest proportion to date – arrived under the Individual Visit Scheme. In the first eight months of 2004, Hong Kong has now welcomed 8,066,752 Mainland visitors, 65.5% more than for the same period in 2003 and 96.3% more than in 2002. Over 2.63 million of these visitors have arrived under the Individual Visit Scheme, 32.7% of the total.

The Americas continues to be Hong Kong’s largest long-haul market with 110,129 August arrivals, 25.3% growth on the same month in 2003. Arrivals from both the United States (83,880, +23.7%) and Canada (22,023, +46.0%) are benefiting from consumer campaigns staged by the HKTB earlier in the year, as there is always a longer lead-time between promotional impact and actual travel in long-haul leisure markets. Cumulatively, arrivals from the Americas in the first eight months have reached 880,713, 72.5% ahead of the same period in 2003 and 1.1% above 2002.

Europe, Africa and the Middle East was not far behind in August with 107,089 arrivals, 43.3% ahead of the same month in 2003. The strong economies in France (14,606, +87.1%) and the United Kingdom (30,505, +46.5%) are increasing consumer sentiment for long-haul travel, while recent trade promotional activities have boosted awareness of Hong Kong in Germany (13,052, +38.4%). For the first eight months of 2004, total arrivals from this region stand at 858,485, 72.9% ahead of the equivalent period in 2003 and 9.6% above those of 2002.

The Australia, New Zealand and the South Pacific region also continues to show healthy growth, with a 43.7% year-on-year increase in August to 33,566 arrivals. Awareness of the Hong Kong Shopping Festival, a strong Australian dollar and increased en-route traffic to Europe all helped to boost arrivals from Australia (28,247, +49.3%). Some 296,502 arrivals from Australia, New Zealand and the South Pacific have now been recorded in the first eight months of 2004, 76.1% ahead of those for 2003 and 14.1% above 2002. This makes it the best-performing of all three long-haul market regions and the longer-term outlook is also promising, as additional air capacity is expected to come on stream later this year.

In the short-haul markets, arrivals from North Asia are maintaining their steady recovery with 155,979 arrivals recorded in August, growth of 30.9% on the same month in 2003. Japan (103,276 arrivals, +32.6%) and South Korea (52,703, +27.6%) both performed encouragingly, although Japan has yet to regain 2002 levels. For the first eight months of 2004 overall, arrivals from this region show a 39.4% increase on the same period in 2003 but a 15.0% decrease on the 2002 figure, due to the slower recovery of Japan.

South and Southeast Asia contributed 172,555 August arrivals, 35.5% more than in August 2003. Star performers were Malaysia (30,977, +68.7%), from where travellers were attracted by special packages offered at consumer travel fairs in Kuala Lumpur and Penang; and Singapore (38,853, 57.2%), where an aggressive air travel price war is generating strong response. For the first eight months of 2004, total arrivals for this region now stand at 1,254,624, 80.0% ahead of the same period in 2003 and 7.2% ahead of 2002. Arrivals from Singapore and Thailand in the first eight months have already exceeded those for the whole of 2003.

Taiwan continues to prove a more difficult market to rebuild, although arrivals were a modest 4.3% down in August at 196,099. Consumer sentiment to travel, already dampened this year by political and economic concerns, was not helped by a major typhoon during the month which caused a number of flights to be cancelled and many residents to postpone their travel plans. Nevertheless, the HKTB said it is continuing its strenuous efforts to promote business and family travel to Hong Kong. Taiwan remains Hong Kong’s second largest source market with 1,375,197 arrivals in the first eight months of 2004, an increase of 22.4% on the same period in 2003 but a decrease of 14.9% on the 2002 figure.

Same-Day In-Town Visitors

In August, 66.7% of all visitors stayed one night or longer, very close to the 66.5% recorded in August 2003. The remaining 33.3% were classified as “same-day in-town” visitors, departing for another destination on the same day as arrival.

More than 79% of all long-haul visitors stayed for one night or more, as did 76% from South & Southeast Asia, 69% from Mainland China and 67% from North Asia. Fewer than 32% of Taiwan visitors stayed overnight, as many visitors from this market are in transit to/from Mainland China or other regional destinations; however, this compares favourably with the 26% recorded in August 2003.

For the first eight months of 2004, 63.1% of all visitors have stayed for one night or more, compared with only 61.8% for the same period in 2003.

Hotel Occupancy

Average occupancy rate across all categories of hotels and tourist guest houses in August was 90%, compared with 88% in August 2003. Top tariff hotels averaged 85% occupancy while those in the second tier reached 93%.

Hotels on Hong Kong Island outside the core areas of Central, Wan Chai and Causeway Bay were especially busy, averaging 94% occupancy. These areas are favoured by tour groups and some individual leisure travellers. The average achieved hotel room rate across all hotel categories and districts was HK$718, a 29% improvement on the August 2003 figure.

Cumulatively for the first eight months of 2004, average occupancy now stands at 86%, compared with only 61% for the same period in 2003 and 82% in 2002. The average achieved hotel room rate is HK$749, a notable improvement on the HK$630 recorded for this period in 2003 and HK$677 in 2002.

See also: Hong Kong Visitor Arrivals surge to record 1.99 million in July 2004