The Price Hong Kong Tourism Pays for Insisting on Strict Covid Measures

John Lee, Hong Kong’s newly-elected chief executive, seems to be a man on a mission. In less than a week of assuming office, he’s managed to end the controversial flight ban that earlier restricted airlines from flying into the city, and has also hinted at shortening quarantine for incoming travelers.

However, if Hong Kong still wants to retain the tag of Asia’s business hub, it would need to move faster. The city has one of the most cumbersome entry rules. Travelers coming in to Hong Kong are currently required to quarantine in a hotel for seven days, followed by three days of self-monitoring.

The flight ban or circuit-breaker mechanism served carriers with a warning and a $2,548 penalty for bringing in three or more infected passengers on a single flight. If the terms were breached again within 10 days, the airline was then prohibited from flying that route into Hong Kong for five days.

Hong Kong has so far suspended 100 flights this year, with Emirates, Qatar Airways and Thai Airways being the latest to be slapped with a flight ban on Monday.

The city also publishes a list of incoming travelers, who test positive on arrival. The names are not mentioned, but seat numbers are given.

Flag carrier Cathay Pacific had been the worst affected by the circuit-breaker mechanism. In May, Cathay’s passenger flight capacity was only 4 percent of its pre-pandemic levels. Buoyed by news of the end of flight ban, shares of Cathay surged more than 5 percent on Thursday afternoon.

In 2018, out of the 65 million international arrivals to Hong Kong, 50 million were from mainland China. In 2021 the number of arrivals was down to 91,000, of which 65,000 were from China.

The Hong Kong economy saw a marked deterioration in the first quarter of 2022, with real gross domestic product contracting by 4 percent year-on-year. After a record outflow of 89,200 residents in 2021, the city recorded a net outflow of almost 140,000 residents in the first quarter of this year.

Almost half of the European companies that responded to a survey by the European Chamber of Commerce in March, said they were considering leaving.

“For months, we also had an arrival ban on nine countries, which was then cancelled just to be disguised as a circuit-breaker mechanism that punishes airlines for carrying three or more positive cases. Through all of this, visitor arrivals plunged more than 99 percent,” said Girish Jhunjhunwala, founder and executive chairman, Ovolo Hotels.

Announcing the end of the flight ban, Lee’s government said a stronger testing regimen would be more effective than flight bans.

Besides the pre-departure test, arrivals into the city would now need to take an additional polymerase chain reaction test (PCR) on the third day, along with the PCR test conducted on the fifth day and the rapid antigen tests on days 6 and 7. PCR tests on the ninth and twelfth days of arrival are also mandatory.

Shorter Hotel Quarantine

Hong Kong’s new government earlier this week had also hinted that it would look to shorten hotel quarantine time for incoming travelers, while ensuring that the move does not risk an outbreak and overburden the healthcare system.

Reports suggest hotel quarantine may be reduced to five days, followed by two days at home.

Shortening of quarantine and the approval of some more airline connections may motivate people with urgent business, education or family to travel. For most others, the spectre of a sudden re-tightening of the rules leaving them stranded in a hotel will continue to keep leisure or transit travellers from coming to Hong Kong, said Wolfgang George Arlt, CEO of China Outbound Tourism Research Institute.

There have been 1.26 million infections and 9,406 Covid-related deaths reported in Hong Kong since the pandemic began. The city with a population of 7.6 million has so far administered at least 177 million doses of Covid vaccines.

“Whilst we welcome the potential reduction in (quarantine) what is already an antiquated policy, we understand this will adversely affect our occupancy,” said Jhunjhunwala, as he hoped this would propel the city towards re-opening.

Fine Balance Between Remaining Open and Risking a Covid Outbreak

As Hong Kong looks to shorten quarantine requirements, the city wants to ensure that hospitals are not overwhelmed, the chief executive said on Tuesday.

“I’m conscious of the need for Hong Kong to remain open and convenient to travellers, but it is also important that we address the risk at the same time,” Lee said without divulging any details about the timeline.

Following China’s recent decision to halve quarantine time for incoming travelers, Lo Chung-mau, the health secretary, posted a blog on Hong Kong’s health bureau website this week expressing hope that the border with mainland China would reopen before August 4.

That Hong Kong’s dynamic Covid-zero policy does not work was proven again last week during Chinese President Xi Jinping’s visit to the city.

In spite of very comprehensive measures in place to shield the President from the virus, authorities could not prevent his encounter with a person who tested positive. “It shows again that the Covid-zero policy, dynamic or not, equals the attempt to catch the wind with a sieve,” Arlt pointed out.

At a time when the rest of the world has been seeing a big recovery of tourism in recent months, hindered only by the lack of staff and functioning airports, Hong Kong will have to make do with encouraging its local population to take some hiking trip in the neighborhood, rued Arlt.