Hong Kong to experience holiday exodus in first Christmas without pandemic travel restrictions, travel insiders say

Hong Kong is expecting a holiday exodus as residents take advantage of the first Christmas season since pandemic restrictions were lifted and borders fully reopened to the world.

Travel industry insiders predicted around 70,000 people would join tour groups departing the city in December, while more than 400,000 people left Hong Kong via air, land and sea border crossings on Thursday.

Fanny Yeung Shuk-fan, executive director of the Travel Industry Council, estimated around 2,800 outbound tour groups – or 70,000 people – would depart the city in December, with around half over Christmas and the New Year holiday.

That is 70 per cent of the level in 2018, before the 2019 anti-government demonstrations.

Travellers at the Hong Kong International Airport. Weaker regional currencies, tax rebates for spending and novelty of first Christmas abroad since Covid is expected to drive people to travel. Photo: Elson Li

“After all, it is Christmas so a lot of people are looking for a white Christmas,” she said. “Hokkaido tours in Japan and going to Korea for skiing are very popular within Asia.”

Many residents would also head across the border to mainland China via high-speed rail on short trips, Yeung added.

The outflow of holiday-goers from Hong Kong is expected as residents take advantage of weaker regional currencies, tax rebates for spending as well as the novelty of the first Christmas abroad since borders reopened.

Meanwhile, around 3.8 million visitors would travel to the city for the month of December to January 2, which was 60 per cent of 2018 levels, Yeung estimated.

But experts did not expect a large bump in visitors to the city over the holiday period to offset the numbers leaving, predicting a gloomy outlook for the retail and catering sectors.

The Immigration Department estimated that 9.03 million people, including residents and visitors, would travel in and out of Hong Kong during the Christmas and New Year holidays.

The city’s Airport Authority says passenger traffic is expected to peak at 160,000 every day with more than 1,000 flights during the Christmas and New Year holiday. Photo: Dickson Lee

Around 83.5 per cent of the travellers would pass through land crossing points with the mainland, while the rest would be via sea or air.

According to department data, there was a net outflow of 84,179 people from Hong Kong on Thursday, with 72,601 having departed via Hong Kong International Airport, the highest daily figure this year.

The Airport Authority said it expected passenger traffic to peak at 160,000 every day with more than 1,000 flights during the Christmas and New Year holiday.

The authority, which runs the airport, said the most popular destinations according to the number of flights during the holiday period were Taipei, Shanghai, Bangkok, Tokyo and London.

Among those travelling was Alexandra Berry, who was excited to spend Christmas with her sister, brother-in-law and mother at their family home in Phuket, Thailand, for the first time in four years.

“It feels so great to be able to come and enjoy it together after a few years of missing out,” said the 32-year-old Hong Kong-born resident, who works in public relations.

But Tommy Tam Kwong-shun, chairman of the Society of IATA Passenger Agents, had expected more people from Hong Kong to travel over the holiday period – pointing to outbound group tours for December being not more than 60 per cent of 2019 levels.

“Being the first Christmas since the opening of the borders and since Covid-19, it should be a peak season, but … it is not really booming this year,” Tam said, pointing to high air fares and the economic factors weighing on domestic travel sentiment.

For visitors, he added those from long haul destinations, such as Europe and United States, had been slow to recover.

Gary Ng Cheuk-yan, a senior economist for Asia-Pacific at Natixis Corporate and Investment Bank, said Christmas was not a holiday on the mainland, and with 80 per cent of tourists to the city from across the border, he did not expect inbound tourism to offset the numbers leaving the city over the festive period.

Ng said he was not confident that the gap between inbound and outbound tourism would narrow, because of the strong demand for travel from Hong Kong, and the city’s lack of competitiveness and attractiveness to the world.

He said that Hongkongers travelling to Shenzhen at weekends was part of a wider trend of people flocking across the border for cheaper and better services.

Therefore, the retail and catering sectors would not see a “significant pick up” in spending during the holidays, Ng said.

“I do not think that this will be a very Merry Christmas for most of the retailers in Hong Kong,” he said pointing to rising rents and labour costs squeezing profits, in particular, for smaller businesses.

Economist Simon Lee Siu-po, an honorary fellow at the Asia-Pacific Institute of Business at Chinese University, said he estimated a loss of HK$2 billion to HK$3 billion (US$384 million) in retail sales and around a HK$1 billion loss in the catering sector this month.

Lee said the weak currencies in the region were among reasons that made short-haul travel attractive for Hong Kong residents.

“Shenzhen offers a tax rebate, while Japan offered sales and a tax rebate putting Hong Kong at a big disadvantage,” he said.

But Yeung argued that the city’s Christmas decorations and lights would be appealing for people from the mainland or Southeast Asia looking for the “festive mood”, which they might not experience at home.

According to a search by the Post, available hotel rooms on Hong Kong Island and Kowloon cost between HK$800 and more than HK$4,000 for one night on December 23 to 24.