Any chance of a costs/benefits analysis?

RTHK reports…

Secretary for Culture, Sports and Tourism Rosanna Law on Tuesday said she is confident the tourism sector could meet the government’s target in accounting for about five percent of the city’s gross domestic product by 2029.

…Law said the target is not “aggressive”, given the city’s track record in being a tourism hub.

Last year, the industry accounted for about three percent of the city’s GDP.

“I think with improved connectivity, with high-speed rail and good cross-boundary facilities, it’s natural that the flow of people in Hong Kong and nearby cities, including Shenzhen, would improve and would increase,” she said.

…While many residents have headed to Shenzhen during weekends or on long holidays for its increasing number of attractions and low prices, the minister said it is “unrealistic” for the SAR to expect other cities, which compete with Hong Kong for tourists, to remain unchanged.

Instead, the city should continue to grow, she said, offering attractions that benefit locals and tourists alike.

So if we can build on our current tourism levels – 50 million in 2025 – we can push the industry’s share from 3% to 5% of GDP. Based on raw visitor numbers, that implies an increase to over 80 million tourists. Where will the extra 30 million people go? How do they fit onto the sidewalks, trains and buses?

And, although 3% vs 5% of GDP sounds like a lot of money, how do we know tourism actually boosts net wealth? Assuming the extra visitors increase demand for certain retail spaces, their presence will push up rent for existing stores, which in turn increases the cost of living for local residents. In some cases, stores serving local consumers might end up going out of business. Local entrepreneurs will see narrower opportunities. On a net basis, the extra two percentage points of GDP might simply be cancelled out by lower GDP in other sectors.

Hong Kong bureaucrats have a fixation with tourism – perhaps because it’s so easy to measure visitor numbers and interpret them as a sign of success. That said, Rosanna Law seems to recognize that by cramming more tourists into Hong Kong, you worsen local quality of life and encourage residents to cross the border for cheaper and less crowded leisure experiences…

“First of all is of course ensure that whatever we are offering to our local people, it should continue to be of good quality, value for money. But together, I think we also have to ensure that whatever we are offering to our visitors, from our nearby cities would be attractive, novel, and also value for money,” the official said.

“This way, I think the flow of people, the flow of visitors will be mutually beneficial.”

But maybe it’s not mutually beneficial. Higher-spending Hongkongers go to Shenzhen for weekends, while more Mainlanders bring packed lunches over the border to have their photos taken standing outside colonial architecture…

Looking ahead, Law said Hong Kong would continue to offer cultural experiences at historic buildings — similar to the old Yau Ma Tei police station exhibition — which she described as very successful.

“We are actually thinking of how to enrich it [the experience] even further, and to maybe even collaborate with nearby shops. One of them has already introduced a nostalgic theme in their packaging,” she said.

“So I think that is a good potential of showing what Hong Kong is like, and what is uniquely Hong Kong to our visitors.”

Haw Par Mansion in Tai Hang, for instance, could showcase the unique East meets West cultural environment of the SAR, Law added.

The 30 million extra visitors go to Haw Par Mansion. Overcrowding problem solved.

The Hong Kong government’s strategy: try desperately to keep rents absurdly high – regardless of far lower costs just over the border – while simultaneously striving for economic vibrancy. (In order to enable over-inflated civil-service salaries, perhaps?)

A couple of other stories of note today.

From the Standard – the average size of new homes in Hong Kong has fallen from 50.4 sq m [542 sq ft] in 1996 to 37.2 sq m [400 sq ft] in 2024…

Nearly half of the units completed in 2024 were under 40 sq m, compared with only 4 percent in 2000, the study said.

Despite the recovery of Hong Kong property completion from the post-2000 trough, the unit size is shrinking, the report said.

Private housing showed diverging trends in sizes: the share of completions under 40 sq m rose from 18 percent in 1995 to 45 percent in 2024, while that of 70 sq m or above decreased from 26 percent to 11 percent, the study said.

Large private homes have shifted from a mainstream product to a marginal share of new supply, it added.

Again, purely down to government policy of prioritizing land revenues over basic living standards. How does it help Hong Kong?

And HKFP reports on a mother pleading guilty to manslaughter after beating and starving her five-year-old child to death in Sham Shui Po. Warning: this is about as grim as it gets.