Poman Lo, Regal Hotels Group Vice-Chairperson and Managing Director and Election Committee member, is on the show.
On whether Hong Kong should open up to the Chinese mainland or the rest of the world first, Ms Lo says Hong Kong can be the mainland's window to the world and "be more adaptive in letting visitors to come" here. She doesn't think Hong Kong is "ready to implement the type of lockdown that mainland cities are implementing". However, since most of our tourists are from the Chinese mainland, she say Hong Kong has to "work very very hard on reopening the border with the mainland."
Check out the full transcript of TVB’s Straight Talk host Dr. Eugene Chan’s interview with Ms Poman Lo
Chan: This is Eugene Chan and welcome to Straight Talk. Our guest tonight is Ms Poman Lo. She is Vice-Chairperson and Managing Director of the Regal Hotels Group, as well as director of several companies, including Century City International Holdings, a group of five listed companies in Hong Kong. She comes to us with over 20 years of experience in hospitality management, business and property development in Hong Kong and on the mainland. She has been a member of the Hong Kong Tourism Board, and is currently a member of the Election Committee in the hotel sub sector. So we have invited Ms Lo tonight to tell us how the tourism sector is going to survive our current border restrictions. Welcome Poman.
Lo: Good evening, Eugene.
Chan: Poman, as you know, the title of the show is, how can our tourism sector survive without the hotel quarantine being lifted? As we all know, I mean, many places of the world have already opened up. And you have seen… Europe and US have seen tourist numbers going up in Hong Kong remains one of the few places that still require hotel quarantine on entry. Not to mention, if there are airlines coming in with more COVID passengers, they will be banned. So how much longer can we survive under such a situation? Because some say this is really killing our tourism?
Lo: Well, unfortunately, you're right, it is indeed killing the tourism industry. So as you all know, we have been affected by the 2019 social unrest. So the past few years have truly been disastrous for Hong Kong. So last year, we received roughly 90,000 visitors. So that is 97 percent down. And just to give you some comparison, back in 2018, we received 65 million visitors.
Chan: Million?
Lo: Yes, 65 million, and in the past two months, guess how many, we only had 9,000 some visitors. So truly it's been detrimental for the tourism industry. And we have all been, you know, hanging tight. And hopefully we'll see the light at the end of the tunnel soon.
Chan: Right, Poman. As you know, business travelers do have very tight schedules and having to spend seven days in the hotel quarantine isn't going to be very attractive, not to mention the potential of flight cancellations as well. So, the Hong Kong General Chamber of Commerce’s George Leung has said we will lose out and we could lose to our rival Singapore. And do you agree?
Lo: I must say that Hong Kong is indeed, you know, being threatened, our competitiveness as a whole, we have lost quite a bit of talent. You know, I think many expatriates in particular, are not very happy with the situation. And also, as you say, business travelers unless they have some inevitable activities, they will not be coming to Hong Kong, if they have to go through quarantine. However, I must say that this is… it’s very encouraging that we have already lifted the ban on overseas visitors. So starting May 1, non-Hong Kong residents are at least allowed to come to Hong Kong with a seven day quarantine. So it's a good start. So we are encouraged.
Chan: Right. Poman, as you know, tourism is one of our major pillars of the Hong Kong economy. Back in 2018 it accounted for 4.5 percent of our GDP, employing 257,000 people. And as you said, with the low numbers of visitors, our GDP has… our economy has contracted by 4 percent by the first quarter. So if we don't open our borders further or with less restrictions, how much more do you think it’s going to affect our economy from your point of view?
Lo: Well, definitely, we are seeing signs of economic slowdown, unemployment is skyrocketing. So everyone is suffering. For the hotel industry, we have had to resort to other means. You know, a lot of hotels are promoting staycation and long stay businesses. Of course, our group has been working very closely with the government, as we are steadfastly supportive of the government's battle against COVID. So we were actually the first hotel to serve as a holding facility for the travelers to wait for their COVID results. And since then six of our hotels have been serving as designated quarantine hotels and community isolation facilities. However, for the whole retail and F&B industry, we've all been badly hit, you know, a lot of restaurants have had to rely on, take away. So we are all at least encouraged to see that slowly, hopefully, we will see a comeback of routine activities.
Chan: Right, Poman, as a member of the Election Committee, and you know, we have a new chief executive-elect, Mr John Lee, what type of suggestion will your sector be giving to Mr Lee, especially, as you just said, the border closing and also the travel restrictions? I mean what would you have suggested? And what is his answer?
Lo: We have always said that it's been already a few years, we started with 2019, COVID-19. So we're already in the third year. So I think the priority really has to be on resuming business and daily activities. Otherwise, we will lose to other cities and countries around the world that are relaxing restrictions. Having said that, you know, Hong Kong is in a very unique position, I don't think we should be reactive, or we should be copying other cities. Rather, we should be proactively taking the role of, you know, being a leader perhaps in trying out some new solutions. In fact, we could even be a pilot testbed for the Chinese mainland. Because again, we have always played the role of being a strategic window to the world. So I think it's important that we don't just reactively resort to copying other models. Rather, we could perhaps leverage on technology, for example, the priority can be placed on allowing those with business needs or reuniting with families, and obviously, those that have already been vaccinated with the booster. So… and also, we could also perhaps, ask the vendors who are… for the rapid antigen tests who are all adequately funded to come up with more creative solutions. I think there are ways to manage the virus, other than just relying on long quarantines. For example, you know, travelers could come to Hong Kong and be required to abide by the LeaveHomeSafe app, and perhaps upload their RAT results on a daily basis, so we could track them. So hopefully, again, the idea is to really encourage travel again.
Chan: Poman, as you know, Hong Kong is in a very unique position, we're at the doorstep to the mainland, and we are adopting a dynamic-zero COVID policy, compared with the rest of the world which is living with COVID. So if you have a choice to choose between opening the borders to mainland visitors, or compared to overseas visitors, what would be your choice?
Lo: So again, the question is whether it should be mutually exclusive? Again, I think Hong Kong is a strategic window. So given the differences in culture, I don't think Hong Kong is ready to implement the type of lockdown that Chinese mainland cities are implementing to control COVID to a zero COVID state. So since we can never do that, I do believe that perhaps we can be mainland's window to the world and be more adaptive, and more agile in letting visitors come to Hong Kong. Having said that, since you know, 70 percent of our travelers, before COVID, came from the Chinese mainland…
Chan: Exactly.
Lo: They are definitely key to an economic recovery. So we do have to work very, very hard on reopening the border with the mainland.
Chan: Right. So let's move on to the hotel industry where you're at. As you mentioned early in the show, we've been through the riot in 2018 and 2019.
Lo: Yes.
Chan: Then we have like two years of COVID.
Lo: Right.
Chan: Compared to SARS which was like a few months. This is really like two years.
Lo: Yes.
Chan: How much longer can the business survive? I mean, it must be tough on you. Because as you just said that travellers are down by 97 point something percent. Right. So we're done with 9,000 travelers, out of 300 hotels in Hong Kong. Let me know how can you… I mean, how bad are your books? Sorry to ask.
Lo: So unfortunately, it's very hard to predict when exactly, you know, COVID will come to an end. Hopefully we'll together work collectively on boosting the vaccination rate further. But again, I think, you know, the key is to remain agile and adaptive. And hopefully we can find the best balance going forward.
Chan: Right, Poman. You know, we had Mr Simon Wong as chairman of the Chamber of Food and Culture Industry of Hong Kong and he had told us that two and a half thousand restaurants close, like, about 15 percent of 17,000 restaurants are closed in Hong Kong. How bad is it with the hotels? I mean, very fortunately we haven't seen any hotel closure. How bad is it?
Lo: To be honest, I think in Hong Kong, most of the hotel developers and operators do not just have hotels as their core business. And having said that, I think you know most hotel occupancy rates have been badly hit. And even when we do manage to attract room guests for long stay or staycation, the profit margin is quite different from what it was before.
Chan: I'm sure, I'm sure.
Lo: And also F&B, with dinners suspended until last month, and also MICE banquet, wedding businesses, all completely wiped out. It is a very difficult period for all of us.
Chan: Last question before the break, being managing all these listed companies with hotels, it must have been very tough. I mean, have you lost many staff over the last two years? Can you retain them with such limited businesses as you just mentioned?
Lo: Well, our staff have been very supportive of the group and especially since six of our hotels have been participating in the government's designated hotel community isolation scheme, we do actually have to rely on the hard work and commitment of our staff. So I'm very appreciative.
In short, it hasn't been easy.
It hasn't been easy. But I believe that Hong Kong is very resilient, we are as a group that we have also gone through SARS, and actually what doesn't kill you makes you stronger. So even back in 2003, after SARS, we have actually risen stronger than before because we were able to identify areas where we could perhaps improve our cost control and also enhance multi-tasking of our staff. So I'm very hopeful that after COVID, we will actually be stronger than before.
Chan: All right, we will have a break.
Thank you.
And see you soon.
Chan: Welcome back. Thank you for staying with us. We have been talking with Ms Poman Lo, about how the tourism sector have been surviving under the current restrictions. So Poman, in the first half, we had talked about the difficulties of the hotel industry and what you have been doing. And I'm sure the viewers would want to ask you, your hotel was designed to be people for leisure, for dinners, for businesses meetings. And to become a quarantine facility, has it been easy? I mean is it to transform from a hotel now to fit all the criteria of being a facility like for holding hotel, holding facility, or even quarantine hotel?
Lo: Especially at the beginning, it was not easy at all. We were actually the very first hotel to become a holding facility back in March 2020, so that was actually pretty much in the beginning of the pandemic. So, you know, very naturally our staff were quite worried, so we actually did have to spend a bit of time to make sure that everyone was actually ready to take on the challenge. But I must say I feel that all, each and every one of our colleagues, they are heroes. They have been so selflessly devoted to fighting the course. At that point we were not sure what were the consequences, but they still stood up for the challenge, so I really applaud them. We did try to provide all the necessary support, in terms of on-the-job training, additional hygiene measures, and also provided more psychological and emotional counselling, and also some additional allowances to support our staff and colleagues along this fight.
Chan: Poman, was there any concern from the business point of view, that being a hotel of such nature will affect the normal core business?
Lo: Indeed, in fact there were a lot of considerations, which is why… I’m sure we were indeed the first hotel, and back then there were a lot of worries and anxieties that we had to deal with. But we felt that we had to play this role, we are not just a business entity, rather we have to perform our civic duty to support the government, and to be with the people of Hong Kong during this fight.
Chan: Right. Poman, we have also looked at some figures of hotel occupancy rate. Of course, it was quite low in the beginning. But after doing all that, and even with other hotels that may not be a facility for quarantine, you see the hotel occupancy rate going up, partly due to the long stay packages, or even like staycation. Do you see staycation becoming a norm of Hong Kong people’s life, even after the pandemic?
Lo: I think it will probably continue to be a part of our, perhaps weekend programs. But to be honest, it’s not easy to provide staycation packages because there's a lot of content that we have to prepare. So when you do look at the bottom line, it is not as satisfactory as when you serve business travellers who come here for a few days. Having said that, I do think hospitality is always about taking customer experiences to the next level. So I think this challenge that we've all gone through does propel us to be better, to serve our customers better, and not just provide a room, rather it is the holistic experience before, during, and after the stay.
Chan: Right. Poman, I just read in the South China Morning Post, there was a recent hotel transaction in Hong Kong by a local buyer, and that means a lot of confidence in the industry. However, if you look at it from the Hong Kong Monetary Authority, they are saying that this pandemic is going to be have a deep and long-lasting impact, what we call a scarring effect, on the global tourism and business travel. So what are your outlook for travelling and especially tourism in Hong Kong, which is such an important pillar of Hong Kong’s economy?
Lo: I still remain very bullish, you know, I myself was in Singapore about two weeks ago, so I can see a huge rebound in business travel and also tourism. So I think once we get past the COVID challenge, there will be a tremendous interest in coming back to Hong Kong because after all we are Asia's world city, we are the regional business hub, with a lot of strengths to leverage on, including our financial system, we’re a trading hub. We have a lot to offer, so I'm pretty optimistic.
Chan: Right. Poman, you being an outstanding student when you were young, then you became (one of the) 10 outstanding young persons of Hong Kong, then 10 outstanding persons of the world. I mean you are one of… maybe the only person who has achieved such recognition. So I think you the most qualified person to talk about young people. We often talk about the Greater Bay Area, and especially in tourism. What opportunities are there for young people with this big market right next to Hong Kong?
Lo: Well, first of all, I think the future belongs to those with a global vision, with a broad perspective. So I think, you know, the key to being successful in the future is to be able to understand and embrace various cultural differences. So I think it's important that we promote more exchange programs, so that our youths can also understand the Greater China market. And in terms of the hospitality industry, I think we definitely are strategically positioned to be a regional training hub for the next generation of hospitality professionals. As I'm sure a lot of you would agree, the hardware in the Chnese mainland is never a problem, we can always get the best designers to build the best facilities. And yet I think Hong Kong still has a competitive edge in providing a higher global level kind of service, because after all, we are the melting pot, the cultural melting pot. So again, I hope that we can serve as that strategic window, to propel China’s development.
Chan: Right. So you just mentioned that Hong Kong tourism will stand for a very good chance for the future in the upcoming… when the pandemic ends. So when you're talking about human resource, which is always Hong Kong’s major asset, we see quite a few expatriates have left Hong Kong, as stated in the news, and some young people… or there may be more immigration in the recent months. How has that been affecting the hotel industry manpower? Has it drained away a lot of your talents or your talents are still in Hong Kong?
Lo: Well, to be honest, I think it has affected both talent recruitment, as well as retention. In terms of recruitment, oftentimes when we do hire senior management level, then it’s more helpful to actually invite them over and have a face-to-face chat, so it’s more difficult when there is a quarantine. And in terms of retention, there has been a number of, especially middle management colleagues who have chosen to leave Hong Kong. So I do think we definitely do need to work on strengthening our competitiveness as an employer.
Chan: Right. Poman, you said you were in Singapore and I am sure you can feel the vibrancy when everything's open up. So how can Hong Kong be rebranded?
Lo: Well, I think we have to re-establish our leadership as Asia’s world city. We are after all the regional business hub, so we have to leverage on our financial strengths, the Sky City developments, we do have one of the best airports in the world. And also we have to leverage on the GBA, all the business opportunities that we can create a lot of synergy with. And you know, I think Hong Kong definitely needs to promote innovation, especially in the area of fin-tech. We can be a strategic bridge connecting Chinese (mainland) companies to the rest of the world. And when there are, especially new startups, technology companies wanting to penetrate Asia, Hong Kong is still the preferred window to the mainland. And also in terms of ESG and impact investing, I think Hong Kong can also play a very strategic role in promoting green finance, for example.
Chan: Right. Poman, in the last section of the show, I will ask you a very quick question. You mentioned technology, fin-tech, etc. I know that your group has started something on the metaverse. Can you just tell the viewers, I mean a lot of people may not be familiar with it, what are you trying to do and how can you link a traditional industry with the technology?
Lo: So the metaverse in a nutshell is basically the next generation of virtual reality, that is based on the latest blockchain technologies and immersive media. I personally feel that in 10 years’ time, everyone will be in metaverse, it will no longer be an option because it will simply disrupt each and every facet of life. The reason why we're entering metaverse with MetaGreen is because sustainability and innovation has always been at the heart of our group’s DNA, and passionately infused in a lot of our corporate initiatives. So MetaGreen is actually a collaborative ecosystem that we're building, with some like-minded partners who share our vision of building a greener future. So we are actually fostering a sustainable community and promoting circulate economy by empowering consumers to adopt more sustainable choices, both in metaverse, as well as in the real world.
Chan: Does it create much commercial value?
Lo: Oh yes, it needs to be sustainable, so I believe that it is a triple bottomline investment, in that it will help the people of Hong Kong by promoting financial inclusion, by promoting eco-friendly choices, it will also definitely help accelerate the transition to a net-zero future. And also it does hopefully generate profit for our group, by allowing us to be positioned as a purpose-driven brand, and to connect to the younger generation.
Chan: Poman, that is all the time we have, we’d love to have you longer. Many thanks to you for sharing your hotel industry challenges and contingencies during the last two years with the pandemic, opening of the border with the mainland would be the first step of recovery. Stay healthy and good night.