Hong Kong retailers concerned about expected two-thirds dip in tourism

Tour groups to Hong Kong could shrink by as much as two-thirds in the first half of this year, an industry executive said, dealing another blow to retailers and an economy facing pressure from slowing growth in China.

"The drop will continue for sure. The winter has just begun," Ricky Tse, chairman of the Hong Kong Inbound Tour Operators Association, said, adding that he expected the number of tours by Chinese visitors to fall by as much as 60 percent in the first half of this year after halving in 2015.

Tse explained in an interview with Reuters that Tourism numbers, however, fell last year for the first time in more than a decade and he expects a further decline this year as the strong Hong Kong dollar continues to drive mainland Chinese to comparatively cheaper destinations such as Japan and South Korea.

As a matter of fact and given the last shift of shopping tourism in the Asia-Pacific region, China accounts now for almost three-quarters of all visitors to Hong Kong.

Amongst the worse hit by this decline there are national companies such as Chow Tai Fook Jewellery, or big international players including Cartier owner Richemont and Burberry Group PLC.

"The move away from pure shopping trips is one of the main reasons that led to the slowdown in Hong Kong," brokerage firm CLSA said in a recent report. "Looking into 2016, we believe the trend will continue."