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Hong Kong Sees Massive Exodus During Holiday Season as Residents Flock to Mainland China

In an unprecedented shift, the vibrant buzz that typically defines Hong Kong over the holiday period quieted to a whisper, as a substantial portion of the populous took their celebrations across the border. This Easter holiday, the city-state witnessed its streets, once lined with bustling bars and busy shopping districts, fall to a hush as residents took advantage of the opportunity to journey out of town.

Over the course of March, Hong Kong saw a staggering 9.3 million exits from its 7.3 million residents, marking the highest number of departures in a single month since records started in 1997, as reported by Bloomberg, drawing upon government data.

The trend persisted throughout the four-day Easter holiday which culminated this past Monday. An analysis of governmental statistics revealed that the number of departures to Macau and the Chinese mainland by Hong Kong residents soared by 10% in comparison to the pre-pandemic heights of 2019. Conversely, the influx of tourists from those regions into Hong Kong during the festivities saw a drastic 46% decrease from numbers recorded in the same timeframe three years ago.

This marked outflow highlights the immense challenges that confront Hong Kong. Once a thriving financial hub, the territory is grappling with a mass migration of professional workers, a contracting entertainment sector, and the pressure of escalating costs. A significant factor behind this exodus is the drive towards the mainland and Macau where they find the distractions of life—entertainment, gastronomy, and retail experiences—not only more diverse but also more affordable.

In the month of March, no fewer than 8.3 million departures through border checkpoints, used predominantly for travel towards the larger Chinese region, were recorded. This numeric is unprecedented in the city's history, dating back at least to 1997. The proximity and allure of neighboring cities such as the modernized Shenzhen and the famed casino capital, Macau, now stand as favored destinations, made all the more accessible due to recent infrastructural advancements, like high-speed rail links and a colossal cross-sea bridge.

Compounding the impact of these neighboring metropolises on Hong Kong's appeal is the city's economic deceleration and the weakening of the yuan. With soaring rental prices and a lack of variety in its entertainment offerings, residents are feeling the bite as affordability dwindles and their options narrow.

Desperate times have fallen upon local bars and restaurants, many of which struggle merely to remain operational. According to Simon Wong, president of the Hong Kong Federation of Restaurants and Related Trades, the dine-in business during the Easter season plummeted by up to 40% compared to the previous year. He disseminated these troubling statistics on a local radio program, further illustrating the precarious state of the industry by highlighting the closure of approximately 300 restaurants over the preceding month.

Echoing this sentiment is the rising popularity of a Facebook group dedicated to charting the closure of Hong Kong businesses. The group, boasting a membership of 186,000, is rife with imagery and anecdotes of deserted retail spaces and beleaguered shopfronts declaring their impending doom.

Even the supermarket giants are not immune to the city's dwindling fortunes. Established chains owned by tycoons, like CK Hutchison Holdings Ltd.'s ParknShop and Jardine Matheson Holdings Ltd.'s Wellcome, are under substantial pressure to innovate amid the tough climate. Meanwhile, conglomerates such as China Resources Holdings Co. and Dah Chong Hong Holdings Ltd. have had to close many grocery stores in the last few months, leading to increased hardship for these long-established pillars of the Hong Kong retail sector.

For the full story on the city's changing landscape, more details are available here: Young Hong Kongers Who Defied Xi are Now Partying in China

Read More: Hong Kong Tycoons Struggle in Retail as Residents Flock to China

In stark contrast, the tourism sector catering to excursions to the mainland is currently experiencing a renaissance. Over the Easter break, travel enterprises such as EGL Tours reported a threefold increase in Hong Kong residents signing up for tour groups headed for China's other urban centers compared to last year. This was confirmed on-the-record by Steve Huen, the company's executive director.

As we watch the outbound drift of residents continue, one can't help but ponder the evolving fate of Hong Kong's economic and social fabric. What was once a bustling island metropolis now stands at a crossroads, with its people looking across the shores for leisure, sustenance, and perhaps a glimpse into a potential new chapter in their lives.

©2024 Bloomberg L.P.

Hong Kong's current reality is a telling tale of the magnetic pull exerted by its behemoth neighbor, mainland China. As traditional hotspots of socialization and commerce experience a downturn, the city-state seems to be succumbing to the allure of new, seemingly boundless opportunities beyond its borders. However, with every departure, the gap left within its urban landscape grows wider, and the future becomes a canvas for speculation and the promises of adaptability and change.

What implications these mass movements harbor for the once-thriving global hub remains to be seen. Will the Hong Kong of future holidays regain its lost residents and reverence? Only time will reveal the impact of these trends and the vigor, or the fragility, of a city adapting to a new era.