Hong Kong-China to loosen border travel rules

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Hong Kong is to scrap its quotas for mainland China tour groups from January 2002, chief executive Tung Chee-hwa said this week. The move will throw open the territory's doors to more mainland tourists, offering a potential spending boom to retailers and travel-related businesses.

In September the Hong Kong Government asked Beijing to lift the quota on the number of tourists allowed to visit from 1,500 to 2,000 a day. But in the downturn that followed September 11, officials sought and received approval to scrap the quota. In fact visitors from the mainland helped offset a tourism slump in Hong Kong. Figures announced recently showed just a 3.3% drop in total visitors during October to 1.15m In the same period the number of Chinese mainlanders rose 25.5% from 317,000 to 398,000. According to the Hong Kong Tourism Adminstration, Chinese visitors spend an average of $5,000 during their three-day stays, just $200 less than US visitors.

Chinese visitor numbers to Hong Kong are expected to double in the next few years. The number of travel agencies in China permitted to organise group tours to Hong Kong has been increased from four to 60 and as a result, processing fees and tour prices for Chinese continue to fall.

Tourism remains a main source of income for Hong Kong which is teetering on the brink of recession. Totalling $7.8bn in 2000, the industry is a top foreign currency earner and has significant repercussions on retail trade.