There are two shocking numbers you should know that you might not have paid attention to, even if you are following English media in Hong Kong.
5.35 million is the number of Hong Kongers who have traveled North to Shenzhen. As reported by the web media HK01, based on previous government data which suggests each person spends HK$680 in Shenzhen, Shenzhen’s economy can receive a profit of HK$3.6 billion!
1500 is the number of restaurants that have shut down, due to a worsening economy among many factors. And it is not just restaurants that have shut down. Just a few days ago, when I returned to the magazine shop where I bought many magazines in recent months, the shopkeeper said they would stop paying rent for the tiny shop space down in Wan Chai, and the store is closed for good.
Even before November 1, with the health declaration gone for good, the influx of Hong Kong visitors was obvious. Border crossings are filled with more Hong Kongers than mainland visitors heading towards Lok Ma Chau station, crowds of tourists flood outside the Futian Checkpoint waiting to march with their tour guides, and in shopping malls, people are anxiously waiting as many Hong Kongers try cheaper food in popular restaurants for the first time in a long time.
And that certainly has generated complaints from the locals, some have sighed they now share the same feelings as Hong Kongers when the city was flooded with visitors (In defense of Hong Kongers, we are much more civilized than some mainland visitors in the past), while supermarkets have seen their stocks of Chinese mitten crabs sold out with some buying them in the dozens before waltzing back to Hong Kong. Some even have complained the prices in shopping mall supermarkets have raised prices due to the high demand.
You might remember one month ago, I wrote this piece:
But even I did not fully foresee the attraction Shenzhen and the mainland have done to Hong Kong travelers, and I bet the government also has its own concerns and worries on why we are seeing this trend happening now. In essence, the problems stem from the good old saying, “It’s the economy, stupid!”
More specifically, “It’s the prices, dummy!”
In an age where the cost-of-living crisis has dogged governments around the world, and with rising prices from inflation hurting many, it is genuinely interesting to see little to no mentions of the rising cost-of-living prices from the media or the government, when the evidence is presented to us every time we tap our Octopus cards.
In the past few years, when I wanted to pay extra for a bowl of vegetables in Cafe de Coral, it only cost me HK$6, now the price is HK$14. Just yesterday, I paid for a McDonald’s burger meal with a burger, fries, a milkshake drink, and an apple pie for HK$60. For just double that price, in Shenzhen, my grandma bought a myriad of delicacies from two types of vegetables, tomato with eggs, meat-based food, soup, rice, and even fried noodles! You might argue these are just personal anecdotes, but if you ask anyone who has lived in the city for years, they can and will complain about the higher prices in everything, from housing to transport.
The lure to Hong Kongers is clear. When you are in Hong Kong and have to pay on average HK$60-80 per meal, and seeing right across the border you can get the same amount and type of food for half the price and with more variety of options. Would you choose to stay here, or spend a little on transport fees before filling your stomach with food not eaten after three years of COVID isolation?
Not to mention, shopping malls in Shenzhen are vastly different than those in Hong Kong. Have you noticed how many shopping malls in Hong Kong are just carbon copies of the same design? One big supermarket, a few restaurants which are just legacy brands and chain stores, maybe some clothing shops, and a few other random shops selling you different goods like books or flowers. Compared to Shenzhen, because of the larger land sizes, shopping malls are huge, and each has a wider selection of restaurants and shops welcoming customers with discounts and benefits. Many luxury shoppers would rather stay and buy handbags from Shenzhen instead of traveling to Hong Kong, which now based on currency rates are the same or even more expensive than buying them in the mainland.
Before the pandemic, Hong Kong’s economy was largely routed in tourism, specifically to mainland visitors. We do not need to once again relitigate the economic impact it has faced since late 2019 due to the anti-government protests, through the pandemic, and to today, when we have seen a larger influx to Shenzhen compared to visitors coming back to Hong Kong. But when combined with all the other factors I have discussed above, the city of the East has lost its lure and spark.
What comes next is bad news for the city’s economy. As I have mentioned earlier in this piece, 1500 restaurants have closed in under 3 months, and there is no sign the trend is stopping anytime soon. In Hong Kong, everything is expensive, and restaurants and other businesses will face the dilemma of either closing down their stores or selling at cheaper prices to compete with their mainland Chinese counterparts. In any sense, it is a win-win for the Greater Bay Area’s influence and economy, but it is a huge lost for Hong Kong’s remaining economic prosperity.
I do not have any concrete solutions or ideas on how to move on from here, but the government should not ignore this issue and pretend it is dead. They need to be out more, addressing the concerns of citizens, and act accordingly. But with the political factors involved, it is hard to say whether anyone will do anything about the cost-of-living crisis nobody is talking about.