HK needs swift action to avert economic depression

Cathay Pacific announced on Oct 21 the immediate closure of its subsidiary airline Cathay Dragon.

In a bid to keep Cathay Pacific afloat, 8,500 employees under the Cathay brand, which includes around 2,500 Cathay Dragon staffers, will lose their jobs.

Despite dwindling case numbers, the third wave of the COVID-19 pandemic in Hong Kong shows few signs of being eliminated. Local cases are still being recorded, which is a strong indication that there are still asymptomatic carriers in the city.

The connection between COVID-19 and Cathay Dragon's closure is obvious－Hong Kong's travel industry has been suffering, first because of the disturbances that started last year and then because of the virus.

The Hong Kong Tourism Board reported that the number of visitors had dropped by a staggering 92.4 percent over the course of 2020, with the past month being the hardest hit compared with the same period last year.

Even with the new "standardized hygiene protocols", Hong Kong's economy－the tourism and related sectors in particular－remains in dire straits.

To give Hong Kong's economy a much-needed boost, the governments of the special administrative region and Singapore are in talks about establishing a bilateral "travel bubble" that would allow travelers to move between the two cities without having to quarantine, provided they test negative before departure and upon arrival, and before returning to and after arriving in their home cities.

Last year, Hong Kong received over 453,000 visitors from Singapore, and Singapore received 489,000 from Hong Kong. Considering these figures, it seems probable that both cities will see some growth in their tourism figures.

But is this the way forward for Hong Kong?

Hong Kong's ties to Singapore are tenuous compared with its connections with the Chinese mainland.

The need to establish a travel bubble with the Chinese mainland and Macao is far more obvious and much more pressing. But the creation of this particular bubble is still a ways off.

Meanwhile, the 538,000 Hong Kong people who usually stay in Guangdong province, together with equally huge numbers in other parts of the Chinese mainland, remain confined to north of the boundary.

Why can't we establish a travel bubble with the Chinese mainland as well?

According to the design of the travel bubble between Hong Kong and Singapore, travelers will have to shell out HK$4,000($516) for the four COVID-19 tests required to travel to and from Singapore. This cost, on top of the price of a return ticket, could be a big impediment for Hong Kong residents who already have to cut back on expenses.

So it is questionable as to how many will actually be willing to spend that much money.

We ought to spend more time regaining the confidence of authorities on the Chinese mainland so that Hong Kong will be regarded as safe enough to be included in a travel bubble.

Not only would this reset relations, but it also would give the boost that Hong Kong's tourism sector sorely needs. A travel bubble with Singapore will help, but the benefits of a Hong Kong-Chinese mainland travel bubble would be far greater.

How can we work toward this?

First, we must eliminate all local COVID-19 cases in Hong Kong, just as the mainland has done and is continuing to sustain. The Chinese mainland's universal-testing program has led to a rapid reduction in infections, and now only a handful of imported cases are reported daily.

The coastal city of Qingdao tested its entire population of more than 9 million over a five-day period using a mixed-sample approach. Similarly, all 11 million of Wuhan's residents were tested in May.

The central government extended the same courtesy to Hong Kong and offered a universal-testing program for its 7.5 million residents. Sadly, the opportunity was turned down. Instead, a voluntary community program was instituted for two weeks and attracted only 1.7 million residents.

Aside from poor publicity, voluntary testing failed to drum up larger numbers for various reasons. Post-program surveys indicate that over half of Hong Kong residents were unwilling to get tested due to such concerns as demands on their time and having to quarantine if they tested positive.

These reasons may well be valid. But the point of universal testing is in its name－universal. To achieve this, we must make it compulsory.

This, as the mainland has admirably demonstrated, is the only way to achieve the "zero local cases" target.

Since it would probably prove difficult to institute compulsory universal testing after the voluntary community testing program's failure, I propose two measures.

First, open a unilateral travel corridor between Hong Kong and the Chinese mainland that allows mainland residents to come to the SAR without having to quarantine, as they are COVID-19 risk-free. This will solve the problem of waning tourism in Hong Kong, as visitors contribute a great deal to the tourism sector and other parts of the economy. They should be allowed to move freely within the city.

Second, place limitations on Hong Kong residents who refuse testing. This would mean banning them from public places, including those in their residential areas and on public transportation. This means they would have to stay home until they test negative.

The pandemic's third wave is nowhere near as bad as the situation in the summer. But no one should feel complacent. And with winter around the corner, we may even see a fourth wave.

Experts say that up to 10,000 Hong Kong residents may become infected, and our hospitals may be overwhelmed to the breaking point.

The Cathay Dragon failure and other layoffs are not isolated incidents. They do not bode well for tourism and other sectors.

They may well be the tip of the iceberg. Most, if not all, businesses could fall one after another like dominoes.

Even the private medical-services sector has been under financial strain. Far fewer patients are going to these clinics for fear of contracting COVID-19, and elective operations are being postponed indefinitely.

If we are to survive, we cannot rely on Hong Kong's feng shui. We must make decisive, and possibly unpleasant, decisions and act swiftly. Otherwise, this winter may bring not only the pandemic's fourth wave but also a great economic depression.

The author is president of the think tank Wisdom Hong Kong.