Hong Kong Travel Ban To Shenzhen Citizens

Hong Kong Travel Ban To Shenzhen Citizens

In an effort to please its residents, China has restricted travel for Shenzhen residents to Hong Kong. The Hong Kong travel ban has come after many complaints from those who live in Hong Kong that their goods are often bought up by visitors from Shenzhen. According to NPR, the limit specifically targets career parallel traders.

Traders from Shenzhen would come to Hong Kong countless times a week and buy up medicines, cosmetics as well as other good since their prices are cheaper in Hong Kong. They would then return home and sell them for a profit.

Tensions have been rising for quite a while as a result of the Hong Kong travel ban. A BBC article written in July 2014 featured a life-long Hong Kong resident and his disdain for his home being treated like a “supermarket.” Because Hong Kong does not charge a goods and services tax, it has fallen victim to parallel traders. If the goods are taken back to the mainland in small quantities traders are able to avoid paying import fees, which is the cause for the frequent trips back and forth.

Earlier this year in February, protests against the mainland parallel shoppers took place in a Hong Kong shopping center. Mainland shoppers were heckled and many arrests were made when crowds became unruly. China’s decision to impose the ban is finally an answer to something that has been a problem for a long time.

The Hong Kong travel ban has some possible negative aspects, however. Raymond Yeung, a Hong Kong-based economist had projected an increase in Hong Kong’s GDP before the ban. Parallel traders currently account for 15% of sales across the city. In 2013 mainland China tourists had accounted for a third of retail sales. Bloomberg reports that residents from Shenzhen will now only be permitted one trip a week to Hong Kong, which will probably affect businesses more than Hong Kong citizens had anticipated.