Hong Kong was the world’s leading tourist city destination in 2018 with 29 million overnight visitors and 65 million total arrivals. The city has benefited greatly from an increasing stream of visitors coming from mainland China over the last two decades, making up more than 75 percent of total arrivals in recent years. In comparison, visitor numbers from other regions in the world have largely stagnated over the last decade. As Chinese visitors from the mainland spend comparatively more money during their stay in Hong Kong, the tourism and hotel sector are highly dependent on revenue from mainland Chinese visitors.
Supported by the growing number of overnight visitors, the number of hotels in Hong Kong nearly doubled between 2010 and 2020, while available hotel rooms increased by more than 40 percent. However, the Hong Kong protests in 2019 had already had a negative effect on the occupancy rate of available rooms, and due to the spread of the coronavirus pandemic, bookings nearly collapsed in February 2020. Besides providing subsidies, the Hong Kong administration initiated a “holiday at home” campaign, promoting hotel bookings and touristic offers to Hong Kong residents. On an international level, the focus is on restarting cross-border tourism with selected regions by re-negotiating travel restrictions.
In April 2022, Hong Kong’s government lifted flight bans from several countries and shortened hotel quarantine time for fully vaccinated visitors. However, despite the gradual relaxation of border control, the inbound tourism in Hong Kong will likely remain limited in the near future, while mainland China, the world’s former largest outbound tourism market, continues both outbound and inbound travel restrictions. Hong Kong’s hotel market is being supported to some extent by pursuing the staycation or quarantine hotel approach. Nonetheless, the industry will possibly stay in a difficult situation until the recovery of the tourism market.
