Editor's note: Dr James T. Wu, chairman of the Hong Kong Association of China Travel Organization Ltd (HACTO), and his 22-member delegation began on July 30 a four-day visit to Beijing. Vice-premier Wu Yi met the delegation and reiterated the central government's commitment to the revitalization of Hong Kong's economy, including its tourism industry. Wu, during an exclusive interview last week with China Business Weekly's Cao Min, outlined his views on the development of Hong Kong's tourism industry and co-operation with the mainland.

CBW: How do you think the tourism industry will develop in the near future, especially after the SARS outbreak?

Wu: With the outbreak of SARS (severe acute respiratory syndrome) in March, various major economic sectors in Hong Kong have been adversely affected, to varying degrees.

However, we see this as a temporary setback, and we are confident people still want to travel. Once their confidence returns, we will see recovery and growth in the tourism sector, which is one of the pillar industries of the "oriental pearl."

The Hong Kong Special Administrative Region (SAR) government has announced a package of economic-relief measures - including reducing business operating costs, providing temporary employment, short-term training opportunities and loan guarantees - to assist employers and employees affected by SARS.

About HK$1 billion (US$128.2 million) will be set aside for a large-scale publicity campaign to promote Hong Kong.

A tourism coalition of Hong Kong, composed of representatives from the aviation, hotel and travel industries, has launched the "We love Hong Kong" campaign, which is aimed at encouraging the public to get out and spend money in Hong Kong to revitalize the economy.

According to a recent survey, Hong Kong received more than 730,000 tourists in June, up 70 per cent over May.

It has also been reported more than 550,000 tourists visited Hong Kong in the first half of July, up 70 per cent over the same period of June. That indicates there has been a pick up in the tourism industry since SARS was brought under control.

CBW: Do you think CEPA (Closer Economic Partnership Arrangement) will spur Hong Kong's tourism industry?

Wu: Of course. CEPA, signed between the mainland and Hong Kong on June 29, will speed up the development of a golden tourism triangle in southern China.

The triangle, encompassing Guangdong Province and the Hong Kong and Macao special administrative regions, or the Pearl River Delta, will become one of world's major tourist attractions.

Under CEPA, Guangdong's residents will be allowed to visit Hong Kong, as individuals, from July this year. And the exit and entry procedures will be simplified beginning this year.

Four cities - Jiangmen, Dongguan, Foshan and Zhongshan - took the lead last week in allowing their residents to visit Hong Kong and Macao as individuals.

On Friday, Vice-premier Wu Yi told our delegation such travel to Hong Kong, on an individual status, will be extended, in October, to Beijing and Shanghai's residents.

It is expected about 10 million tourists from the mainland will visit Hong Kong in the near future.

Last year, the number of tourists to Hong Kong reached 16.56 million, among which 41 per cent were from the mainland.

That means 6.83 million mainland residents visited Hong Kong. The region has 6.82 million residents.

As living standards have improved in the mainland, on average, each mainland tourist has been spending about 5,100 yuan (US$617) during his/her stay in Hong Kong.

CEPA is mutually beneficial, as it will help the mainland adjust to the challenges arising from joining the World Trade Organization, through pilot-testing market openings, and by gaining regulatory experience.

The arrangement will also expose domestic enterprises to outside competition, and, hence, build up China's industries ahead of foreign competition.

CBW: How will you and your association fend off the fierce market competition?

Wu: In the face of fierce competition, we shoulder even greater responsibility.

Many problems still exist ... such as guaranteeing tourists' health and safety and improving service quality.

As a trade association, HACTO was founded in 1983 to promote the travel industries of the mainland and Hong Kong.

We should put forward more constructive suggestions to help the travel industry ... grow.

The mainland and Hong Kong's removal from the World Health Organization's list of SARS-affected areas will restore peoples' confidence in Hong Kong.

We hope we can make concerted efforts to develop the travel market and raise service quality.

The future can be wonderful and also cannot be at the same time. That depends on all Chinese people.

(Business Weekly 08/05/2003 page8)