HONG KONG • Cathay Pacific Airways and the owner of Hong Kong's luxury The Peninsula hotel became the latest companies to highlight the impact of recent protests on their businesses, as an escalating series of violence clouds the outlook for the city.
Millions in Hong Kong have taken to the streets in anti-government protests that have intensified since the middle of June, at times forcing banks, stores, shopping malls, restaurants and even government buildings to close as the demonstrations degenerated into violent clashes between police and activists.
Hong Kong's flagship airline, Cathay Pacific, said yesterday that the protests reduced inbound passenger traffic last month and travellers were weighing on forward bookings, as it reported a swing to a half-year profit.
Thousands of protesters last month descended on the Chinese-ruled city's airport, where some chanted "free Hong Kong" and others handed out fliers explaining the city's crisis to tourists.
Protesters plan to rally at the airport again this weekend, potentially causing further disruptions after a strike on Monday saw more than 200 flights cancelled.
Hongkong and Shanghai Hotels Limited, the owner of the opulent The Peninsula hotel in the bustling shopping district of Tsim Sha Tsui, said that it, too, was worried about the impact of the protests on tourist arrivals, as well as on the broader economy.
"We are concerned about the effect this political uncertainty may have on our results, especially given the proportion of our income that is earned in Hong Kong," said Mr Clement Kwok, chief executive of the hotel group, in an earnings statement yesterday.
In June, Hong Kong-based cosmetic and healthcare products chain operator Bonjour Holdings issued a profit warning which it partly blamed on the protests.
What started as an angry response to a now-suspended extradition Bill, which would have allowed people to be sent to mainland China for trial, now includes demands for greater democracy and the resignation of Hong Kong Chief Executive Carrie Lam.
Hong Kong retail sales, a key part of the city's economy, felt a growing impact in June from the mass protests, falling 6.7 per cent from a year earlier in the biggest decline since February.
Many businesses in Hong Kong are already facing strains from China's economic slowdown, a weak Chinese yuan and fallout from the trade war between the United States and China.
Tourism to Hong Kong, especially from mainland China, has dropped markedly, weighing on hotel occupancy rates. Britain, Japan, Singapore and Australia have issued travel alerts following the violent protests.