As Hong Kong mulls restricting the number of inbound Chinese travelers, Taiwan is stepping up efforts to court rich holidaymakers from the mainland.
Both territories share similar antipathy toward China, but the fortunes and frustrations that come with the increase in mainland tourists have led the once-colonial Hong Kong and self-ruled Taiwan, which China aims to reunify, down diverging paths as of late.
Last week, embattled Hong Kong chief executive C.Y. Leung said the government may limit the number of mainland visitors following a protest in the suburban district of Yuen Long. Protestors blame affluent Chinese tourists for monopolizing resources and driving up prices of daily goods. The backlash follows the "Occupy Central" movement, which paralyzed the city's financial district for nearly three months last year as protestors campaigned for the ex-British colony's right to choose its own leader.
However, the idea of limiting tourist arrivals prompted concerns in the business community, with tycoon Li Ka-shing warning that the policy would hit the retail sector and spark a 1,000-point tumble in the Hang Seng index. Still, more than half of Hongkongers polled in a recent survey say Chinese arrivals should be more strictly controlled.
While analysts believe the restriction is unlikely to materialize, a buildup in anti-China sentiment has deterred mainland travelers, who make up a huge chunk of Hong Kong's total tourist arrivals. Over the recent Lunar New Year, the volume of Chinese holidaymakers fell for the first time in 20 years, while retail sales in January posted their biggest decline since the onset of SARS in 2013.
Increasingly adventurous travel options for the well-traveled Chinese middle class are also dimming Hong Kong's appeal.
"Having been there so many times, the mainlanders are getting bored with Hong Kong and are looking at other places like Japan and even Europe," said CLSA's senior investment analyst Mariana Kou.