Stalemate over HK's Ocean Park continues
The fate of Hong Kong’s signature Ocean Park continues to hang in the balance as the Hong Kong Special Administrative Region Legislative Council on Tuesday failed again to decide whether to approve the government’s proposed emergency funding to keep the park from going bust.
Opinions have been deeply divided as to whether the HKSAR government should spend HK$5.4 billion (US$697 million) to keep Ocean Park afloat over the next 12 months or allow it to go into bankruptcy.
Without the urgent bailout, the 43-year-old theme park could be forced to shut down by the end of June, putting the well-being of some 4,000 staff members as well as about 7,500 animals in the park at risk.
Visitors from the Chinese mainland have contributed to a large part of Ocean Park’s ticket revenue, taking up over half of the total visitors in 2003 when the Individual Visit Scheme for mainland travelers began. In the following decade, the park’s visitor number grew from 3.7 million in 2003-04 to over 7 million in 2012-13, when it was recognized as the World’s Top Theme Park by the prestigious “Applause Award.”
Since June of last year, however, Hong Kong has been grappling with a prolonged social unrest characterized by violent incidents. As a result, the park is rapidly losing its largest visitor market.
During the July-December period last year, Ocean Park received merely 1.9 million visitors, an over 30 percent plunge from the previous year.
The COVID-19 outbreak has deepened the financial crisis as the park, along with other attractions such as Hong Kong Disneyland, temporarily stopped operations in late January.
According to the park’s report to the Hong Kong LegCo, it estimated a HK$600 million cash deficit in the 2019-2020 period, up from HK$557.3 million for 2018-2019 and HK$236.5 million for the previous year.
The park had initially sought a cash injection of HK$10.64 billion from the HKSAR government in January for redevelopment and financial burden alleviation.
However, given the COVID-19 pandemic and the rapidly changing global tourism landscape that followed, the government on May 11 proposed a revised bailout package of HK$5.4 billion.
The new funding proposal aims at supporting the park’s operation in the next 12 months and paying off a commercial debt of around HK$3 billion so that the park could avoid liquidation.
If Ocean Park is eventually shut down, some HK$10 billion will be needed to repay commercial loans, rehouse the animals and pay off employees, among others, according to the park’s deputy chairman Lau Ming-wai. “It will not have a beautiful ending if the park closes for good,” Lau said.
Industry insiders said the predicament of Ocean Park is a vivid reflection of Hong Kong’s tourism, which provides nearly 257,000 jobs. Hong Kong’s unemployment rate surged to 4.2 percent during the period of January to March 2020, the highest in more than nine years. The tourism and consumption-related sectors has a combined unemployment rate of 6.8 percent.
To survive the future, Ocean Park needs to re-adjust its position, improve management and find ways to keep local visitors, lure visitors back from the mainland and explore overseas markets, industry insiders said.