Shutdown fears as travel agency closes branches

Hong Thai Travel Services, one of the largest and oldest travel agencies in Hong Kong, has closed all of its six branches until the city is reopened fully to the mainland and the world.

The closure came as online media outlet BossMind reported that Hong Thai could face liquidation next week despite the government last month relaxing pandemic quarantine rules for overseas arrival to "0+3," meaning no hotel isolation for inbound travelers and three days under medical surveillance.

But Covid has been taking its toll since early 2020, with Hong Thai staff said to have only worked for four to eight days each month and being paid on a pro rata basis. They were also free to seek part-time jobs.

Hong Thai denied yesterday it was folding and said there were no plans to lay off staff, but admitted the company "cannot operate normally at this stage."

The agency also told The Standard it has "never given up" amid the pandemic and noted that it had launched an online shopping platform, HT Mall, selling goods such as souvenirs and fruit.

Hong Thai said the 0+3 policy brought "a ray of hope" to outbound tourism, but "over the past two years it is like the tourism sector has entered an endless dark tunnel." It was also noted by the agency that staff including front-line tour escorts have gone into new lines of work.

"At present, most outbound travelers are individuals, so it's difficult to support the company in full operations. Therefore, the company and our branches cannot operate normally for the time being," it said.

"The company will operate on minimized costs to preserve strength until borders are fully reopened."

So four Hong Kong branches - in Causeway Bay, Kowloon Bay, Mong Kok and Tsuen Wan - along with one in Shenzhen and another in Macau have closed until further notice.

Fanny Yeung Shuk-fan, executive director of the Travel Industry Council, noted that Hong Thai had applied to organize a few outbound group tours before September and had also sought to operate local tours.

Since supervisory power has now been transferred to the Travel Industry Authority, Yeung added, she is not aware of the changes Hong Thai Travel Services has experienced during the past two months.

But Yeung said she is not surprised to see travel agencies scaling down operations and suspending branch business.

The tourism sector has been in a difficult situation for almost three years, she said, and operators are "at a cross roads" when deciding whether to continue investing in the business.

And although authorities have relaxed the quarantine policy for inbound travelers, the tourism business has not rebounded, while operators no longer have a subsidy from the Anti-Epidemic Fund.

Tourism sector legislator Perry Yiu Pak-leung said travel agencies cannot benefit much despite many Hongkongers starting to travel overseas again and not all markets have been reopening fully.

"A large travel agency needs to be supported by many businesses," he said. "It cannot rely on a single market to maintain its operations."

Yiu also called on authorities to consider giving exemptions for travel agencies to organize inbound group tours under the 0+3 arrangement.

Established in 1966 by Jackie Wong See-sum, Hong Thaiis one of Hong Kong's oldest tour agencies and it was earlier among the largest with over 30 branches and 1,100 employees.

In 2019, the company wassoldfor HK$116 million to Shenzhen-listed Caissa Touristic.

Additionally, three of the agency's five directors have quit this year.

In July 2020, it was reported that a creditor, Webport, had filed a winding-up petition against Hong Thai at the High Court, but the agency said at the time that was only due to a delay in a money transfer and the company could solve the problem.

sophie.hui@singtaonewscorp.com