China tourists "ripped off" over exchange rates

Hong Kong - Chinese tourist Li Xiabo sits down to a lunch of pork and rice at an outdoor cafe in Hong Kong's Ocean Park theme park. A customer on the next table eats an identical meal. The only difference, in fact, is the price.

While the Hong Kong customer paid 45 Hong Kong dollars (5.8 US dollars) for his lunch, Li paid the equivalent of 51.7 Hong Kong dollars.

And whether he knows it or not, Li will pay a hefty surcharge of 13 per cent upwards for everything he buys inside the park compared to the man at the next table.

The reason for the disparity is simple: Li - like hundreds of thousands of Chinese visitors - paid for his meal in his home currency, the yuan.

Trumpeted as a convenience for the growing number of mainlanders pouring into Hong Kong, the dual-currency approach appears to have become a method of increasing profit margins by stealth.

Ocean Park and Disneyland - like a number of major shops and department stores - offer a one-to-one exchange rate for customers paying in yuan even though 100 yuan are currently worth more than 113 Hong Kong dollars at official rates.

Both the chairman of the Hong Kong Tourism Board and the legislator representing the city's tourism sector described it as unfair and damaging to Hong Kong's image and called for a better deal to be offered to mainland visitors.

But those imposing the punitive exchange rate on Chinese visitors, at a time when tourism arrivals are slumping and the government wants to attract more visitors from China, defended the policy.

In practical terms, the effect of the policy is that when Li handed over a 50 yuan note meal and was given change in Hong Kong dollars, his lunch had cost him the equivalent of 6.7 Hong Kong dollars more than a customer paying in the local currency.

It might sound a trifling amount - but for mainland visitors the extra bucks on a bowl of rice are just one item on a long shopping list of surcharges that can potentially add hundreds or even thousands of yuan to the cost of a Hong Kong visit.

For anyone who uses yuan throughout their Hong Kong stay, losses can multiply steeply if they decide to call in on Disneyland or indulge in a spot of brand name shopping using Chinese currency.

At Disneyland, a visitor who pays in yuan for an adult ticket will end up paying the equivalent of around 417 Hong Kong dollars to get in, nearly 70 Hong Kong dollars above the advertised price. And that is before they have bought a single souvenir or soft drink.

The same one-to-one exchange rate, with change given in Hong Kong dollars only is offered at big-name fashion stores throughout town.

Shop staff asked at why they didn't offer a rate closer to the official exchange rate said it was simpler just to charge one-for-one or that they didn't have the facilities to vary exchange rates daily.

Surprisingly, the Hong Kong Tourism Board says it has yet to receive a single complaint about the exchange rate. But that does not mean the practice is acceptable, said chairman James Tien.

"This is damaging to Hong Kong's image," he said. "Hong Kong is a cosmopolitan city and people should feel when they come to visit that we are fair and that we aren't taking advantage of people over little things."

"It is bad for our image as a dining and shopping paradise if restaurants and retailers are doing this," he said.

Legislator Paul Tse, who represents the tourism sector, agreed: "I didn't realize they were ripping tourists off like that. It is not fair that these shops are reaping a windfall from the difference in the exchange rate."

Asked why Ocean Park charged at a rate of one to one despite the relative strength of the yuan, the company said it benchmarked its yuan exchange rate against those of the major department stores, supermarkets and theme parks in Hong Kong on a monthly basis.

Disneyland also defended its policy, saying guests could use currency exchange centres in the park or pay with credit cards.

However, a spokeswoman added: "We will continuously review the rate and our acceptance policy in view of the economic situation."

A spokeswoman for SOGO department store in Causeway Bay said the store had accepted yuan since 2007 but said "less than 10 per cent" of mainland shoppers paid in yuan with more using credit cards.

The exchange rate was one-to-one for "ease of operations", she said, and the store might consider reviewing its policy but had no immediate plans to do so.

Meanwhile, as the global economic slump deepens and tourists from China watch their spending more closely, it remains to be seen how much longer Li and his yuan-carrying compatriots will stomach the surcharges served up with their Hong Kong holiday experiences. (dpa)

General: 
Regions: