Individual Visit Scheme - Economic Impact

Economic Impact

According to the statistics released by the Immigration Department, about 800,000 to 900,000 Mainland visitors travel to Hong Kong monthly. The ratio of visitors under the scheme rose from 5% to 16.8% between August and October 2003, and to more than 30% in May 2004.

The increase in the number of Mainland tourists has benefits the economy of Hong Kong, demonstrating the economy is on an upward track. Average occupancy rate across all categories of hotels and tourist guest houses in September 2003 was 82%, the same as that in September 2002. This performance was spread across different types of hotels, with the top-tariff hotels achieving 81% occupancy and those of medium tariff recording 83%. The average achieved room rate was HK$ 684, the highest figure since April 2003, although this is still 2.8% below the comparable rate for September 2002.And in 2006,among the spending of all the visitors in Hong Kong, mainland visitors has taken up to $400 billion, which is one-third of the income.

The government has set up an Economy Relaunch Campaign, which includes raffles, the Lantau Festival, and Individual Visits to provide extra resources to revive the economy. These enhance the appeal of the Individual Visit Scheme.

"As the scheme is attracting a large number of Mainlanders to Hong Kong, it created a 'positive by-product' to attract overseas travelers to visit Hong Kong," said Miss Kinnie Wong, the assistant commissioner of the Tourism Commission. She added that tourists from overseas markets such as the United States and Australia may feel safe visiting Hong Kong again in the coming winter or during the Chinese New Year.

It has been suggested that more and more Mainlanders coming to Hong Kong will lead to the authorized saving of renminbi in Hong Kong. This change enables Mainland travelers access to money more easily when they need it. As a result, it will be more convenient for them to shop and trade in Hong Kong. Besides, the simplicity of the visa application process makes it beneficial. Since people are usually not willing to perform complicated procedures to apply for visas before visiting another place, the Individual Visit Scheme helps encourage visitors to Hong Kong. These two effects are considered long term.

She also pointed out that women joining the Individual Visit Scheme come to Hong Kong because they want to purchase brand-name products. An individual traveler, Mrs. Chiu, said that the brand-name products in Hong Kong are of more variety and are much cheaper when compared with other foreign countries.

As a short-term effect, there will be a rise in the employment rate and investment. Owners of shops or companies can foresee this vital trend and will employ more people in order to meet the needs of the influx of Mainland travelers.