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Articles

Maintaining competitiveness of aviation hub: Empirical evidence of visitors to China via Hong Kong by air transport

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Pages 1260-1284 | Received 18 Dec 2016, Accepted 24 Mar 2017, Published online: 19 Apr 2017
 

Abstract

Prior studies have not extensively researched and explored the key determinants (aviation and tourism attributes) that could affect Hong Kong’s competitiveness as a transit hub for international visitors using Hong Kong as a stopover to Chinese cities when travelling by air. This study adds to that knowledge to empirically investigate Hong Kong’s eight major tourist source markets (Germany, India, Japan, Singapore, South Korea, Taiwan, the UK, and the US), and also provides an insight to policy-makers in Hong Kong to help them understand the factors that influence Hong Kong’s aviation hub competitiveness and tourism development. The findings of the study suggest that increased air transport capacity from foreign countries and Hong Kong to China, trade volumes between China and its trading partners, air transport costs, and the global financial crisis are the key factors affecting the number of visitors to China by air passing through Hong Kong as their preferred stopover. The policy implications of the findings are discussed.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1. The 2015 Policy Address of the Hong Kong SAR Government states that ‘the Government will continue to give full support to the Airport Authority to implement the three-runway system project at the Hong Kong International Airport. The project aims to strengthen our position as an international and regional transportation hub’.

2. As of 2015, Hong Kong has signed a total of 64 bilateral air service agreements with foreign sovereignties (Hong Kong Government, Citation201Citation6). Currently, the third and fourth freedom traffic rights are available for 61 passenger routes between Mainland China and Hong Kong with no restriction: the routes of Beijing, Shanghai Pundong, and Shanghai Hongqiao with restrictions on seat capacity and carriers as well as 63 air cargo routes with no restriction (Hong Kong Airport Authority, Citation2016 - HKIA’s Master Plan 2030). There are no fifth freedom traffic rights for foreign carriers flying to Mainland China via Hong Kong, but some fifth freedom traffic rights for foreign carriers via Hong Kong to a third country (e.g. Air New Zealand flies from Auckland via Hong Kong to London Heathrow, and Singapore Airlines flies from Singapore via Hong Kong to San Francisco in the US).

3. In 2014, HKIA handled a total of 4.42 million tonnes of air cargo (Airport Council International, Citation2014).

4. The analysis period of this study is limited by the China National Tourism Administration (CNTA), which only publishes the free online data of monthly tourists to China for the sampled eight tourist source markets after January 2009.

5. This figure indicates the share of visitors to Mainland China via Hong Kong by air, land, and sea transport (Hong Kong Tourism Board, Citation2014c).

6. Previously, there were constraints in airport infrastructure, especially capacity in China’s domestic airports. In the last decade, there were a number of airport expansion projects in the major Chinese airports. For example, the third runway at Guangzhou Baiyun Airport was completed in 2014, and it will eventually have five runways in service.

7. Hong Kong Tourism Board records the actual number of international visitors who visit and stopover at Hong Kong to Mainland China with different purposes of visit (e.g. vacation, business/meeting, VFR, and en route and others).

8. Approximately 7% of UK visitors to Mainland China travelled via Hong Kong by air transport in March 2011 (Hong Kong Tourism Board, Citation2014c).

9. The real exchange rate is measured by Hong Kong’s CPI divided by the sampled country’s CPI and then multiplied by the exchange rate between Hong Kong Dollars and the currency of the sampled country.

10. The variable of CPI-air transport is sourced from the ‘Inbound and outbound transport fares’ of Hong Kong’s CPI calculation. It serves as a proxy for the cost of air travel in Hong Kong.

11. The table of correlation matrix is not reported for the sake of brevity. Please contact the corresponding author for the result table.

12. Airlines (e.g. Cathay Pacific Airways) use the belly space of the enormous number of scheduled passenger flights for transporting air cargo between Hong Kong and Mainland China (Lin & Chen, Citation2003).

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