Hong Kong retail stocks slumped Tuesday after reports the government is considering a 20 percent cut in visitor visas for mainland tourists.
Among the worst hit were Sasa International Holdings Ltd. (00178.HK), Wharf (Holdings) Ltd. (00004.HK) and Chow Tai Fook Jewellery Group Ltd. (01929.HK), which lost 3.79 percent, 3.5 percent and 3.2 percent, respectively.
The government played down the reports but it not stop some securities investment firms including Macquarie, Bank of America Merrill Lynch and UBS from warning that Hong Kong retail sales could fall as much as 7 percent from any such cut in mainland tourist arrivals, Ming Pao Daily reported Tuesday.
The Hong Kong Retail Management Association said any move to trim the quota under the government’s solo visit scheme for mainlanders will harm Hong Kong’s image as a tourist hub, undermine the livelihood of thousands of workers in the retail sector and ultimately hurt the economy
It urged the government to maintain the status quo.
Meanwhile, Hong Kong Tourism Board chairman Peter Lam welcomed the proposal, saying it shows the government has considered the impact of travelers on Hong Kong people. However, he said a comprehensive review needs to be carried out before the policy is implemented.
Of the 40.75 million mainlanders that visited Hong Kong last year, more than half were on solo visitor visas. About 12.15 million were on multiple-visit visas issued in Shenzhen, with the remainder on group tours, the report said.
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