Hong Kong was once renowned for its vibrant “night economy,” nicknamed “The City Never Sleeps.” However, three years into the pandemic, while various sectors have gradually returned to pre-pandemic norms, Hong Kong’s “night economy” is yet to be revived. The bar industry has reported a 20 percent decline in business compared to the pandemic period, trailing behind other dining establishments. Additionally, changes in spending patterns among mainland Chinese tourists, a decrease in overnight visitors, and increased competition from neighboring regions have all contributed to the lackluster state of Hong Kong’s “night economy.”
Facing Tough Competition In A Zero-Sum Game
Many cities in Asia have developed a “night economy,” and many areas have gone to great lengths to attract tourists back to their cities after the quarantine. Taipei, for example, has had a night market economy for many years. Still, the Taipei City Government is looking to transform this kind of traditional eating, drinking, and entertainment venue into an innovative platform to showcase culture and art. Even mainland cities are opening roadside stalls to boost consumption after the pandemic. Since September, Shenzhen City has been revitalizing its night market by designating places for stalls to operate based on the principles of “convenience to the public, reasonable layout, and orderly supervision.”Faced with fierce competition from neighboring regions, despite the Hong Kong government emphasizing that private consumption and service trade are the “two locomotives” driving growth in the latter half of this year, personal consumption has slowed down, dropping from a 13 percent growth rate in the first quarter to 8.5 percent in the second quarter. Indeed, policies during the pandemic have changed the habits of Hong Kong residents, leading them to reduce nighttime outings and spending. Furthermore, with the summer holiday season in full swing, many residents are keen on overseas travel to destinations like Singapore, Malaysia, Thailand, Japan, and South Korea, further dampening Hong Kong’s “night economy.”
Shops Closing Early, Streets Deserted
Once bustling areas, such as the tourist districts of Causeway Bay and Mong Kok, now see most stores closing by 8 p.m., with restaurants ceasing to take orders as early as 9:30 p.m. Streets become quiet by 10 p.m., with businesses rushing to close early due to a dwindling number of customers. With fewer customers, shop owners struggle with high rents and labor costs, leading to early closures and reduced staff shifts, creating a vicious cycle.In addition, Hong Kong currently lacks large-scale cultural and entertainment events. Even international sensations such as Taylor Swift have opted to hold their world tour concerts in other Asian cities such as Japan and Singapore, leaving Hong Kong, known as the “event capital,” out of their tour destinations, resulting in potential losses of millions of dollars.
Learning From London’s Success
The “night economy” has immense potential with appropriate planning and development. According to data from the UK’s “Night Time Economy Report 2023,” the “night economy” created over 1.66 million nighttime job positions in 2011, which rose to 1.95 million by 2019. Although it contracted by 8 percent at one point during the pandemic, it has now already nearly fully recovered.
Even during the challenging year of 2021, the UK’s “night economy” remained substantial, with an overall scale of approximately £93.7 billion (about US$119.5 billion), accounting for about 4.1 percent of the country’s GDP (down from 5.1 percent in 2019). According to Ernst & Young’s research report, the financial center of London alone contributes nearly 40 percent of the UK’s “night economy” revenue.
