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The year 2009 is full of hardships as far as the industry isconcerned. Both the global financial crisis, which broke out in the

United States in September last year with its impacts fully felt in HongKong in the first quarter of this year, and outbreaks of human swineflu, which began to be recorded in many parts of the world in Apriland May this year, have dealt a heavy blow to both the outboundand inbound trades. Although the markets during the past two tothree months had already turned around, the amount of the outboundlevy collected dropped by 15.6% to about HK$16.7 million for thefirst nine months of this year and the number of visitor arrivals wasdown by 3.4% to about 19 million during January to August.

After Hong Kong saw its first human swine flu case in May this year,the markets plunged rapidly. The TIC therefore was engaged inrepeated discussions with various government departments, fightingfor relief measures to be rolled out as quickly as possible. TheGovernment finally announced in late May several measures to helpthe industry, including waiving the travel agent’s licence fee for oneyear and increasing the government-guaranteed amount and themaximum loan amount under the Special Loan Guarantee Scheme.Although there are already signs of a recovery, the future is notcertain. It is hoped that members can maintain their good service inorder to weather the current crisis. In the following, I will briefly reviewthe work of the TIC during the past year under several categories.

Executive Director’s Report

TIC Annual Report 2008/2009

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Outbound travelDuring these two years, several airlines reduced agency commissionone after another, and Air France and KLM even announced recentlythat zero commission would be implemented from 1 April 2010. Toexpress intense dissatisfaction of the industry, the TIC held anExtraordinary General Meeting on 14 October this year, duringwhich resolutions strongly opposing zero commission and demandingabandonment of the zero-commission plan were passed. Apart fromthat, the TIC is now seeking the view of a senior counsel in a bid tostudy whether reduction or revocation of agency commission wouldbe in breach of the agreement between airlines and members.

In the past, the Government would issue travel advice or travelwarnings after taking account of the conditions of unexpectedhappenings in foreign places in order that the travelling public couldhave some reference when planning their outbound trips. To allow thepublic and the industry to have clearer guidelines, the Security Bureauhas decided, after consulting the TIC and other related industries, tolaunch a new Outbound Travel Alert (OTA) System, which will usethree colours -- amber, red and black -- to designate three differentlevels of risk. The OTA System, to be effective from 20 October 2009,will send out clearer messages and facilitate rearrangements ofpackage tours by members. The TIC is now discussing with theinsurance industry to see whether it is possible to have betterprotection for travellers by covering package tours affected by OTAsin travel insurance policies without extra premiums.

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The Hong Kong Information Technology Federation held a seminarfor members on 10 July 2009 to introduce ways to promote businessthrough innovative use of information technology. Guest speakersdiscussed the difficulties of and solutions for implementing CRMsystems at the seminar.

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The outbound levy was reduced to 0.15% from 0.3% with effect from3 July 2009. Despite persistent lobbying by the TIC to have itreduced, this was the first time since 1997 that the levy rate had beenreduced. As the Hong Kong economy has not completely reboundedfrom the troughs, the levy reduction should be able to lessen theburden of outbound agents.

Inbound travelIn 2007, the TIC had introduced the Continuing ProfessionalDevelopment (CPD) Scheme for Tourist Guides in an effort to ensurethat the service and conduct of tourist guides would reachprofessional standards. In the preparatory stage of the scheme, theTIC had consulted many tourist guide associations and obtained theirbacking. When the scheme was later put in place, however, theyasked the TIC to abolish the “Knowledge on Hong Kong” Quiz underthe scheme on the grounds that many tourist guides complainedabout the pressure brought about by it. After studying the matter, theTIC came to the conclusion that the quiz should be kept becauseprofessional tourist guides ought to update their knowledge regularlyso as to grasp the rapid and frequent changes in Hong Kong.Nevertheless, the TIC has decided to introduce a “Knowledge onHong Kong” Workshop, which lasts for about six hours, so that touristguides will be relieved of the pressure of the quiz if they choose toattend the workshop rather than take the quiz.

As quite a number of members had expressed concern about a lackof English-speaking tourist guides, the TIC had set up an exemptionregime for those guides in 2008. Under the regime, which will endin late February next year, they are eligible for applying for a TouristGuide Pass after passing a qualifying examination. About 20 peoplehave made use of the regime so far. The TIC is now activelypreparing a training course for would-be tourist guides who speakEnglish so that the problem of insufficient English-speaking touristguides can be solved once and for all.

Under the Mainland and Hong Kong Closer Economic PartnershipArrangement (CEPA), Hong Kong permanent residents with Chinesecitizenship may obtain mainland tourist guide and outbound tourescort permits. The TIC is now discussing with the Vocational TrainingCouncil to see whether courses helping local tourist guides to preparefor the qualifying examinations could be organised. Also, theGuangdong provincial authorities are now authorised to process andapprove applications from members to set up travel agents in theprovince, and a circular was sent to members to inform them of thedetails.

To ensure that inbound agents, tourist guides and registered shopsmeet the rules applied to them, the TIC had appointed the ProductivityCouncil two years ago to carry out spot checks at tourist attractionsand inspect registered shops. A little while ago, Vigers SecurityLimited was selected through an open tender exercise to take over the

10 TIC Annual Report 2008/2009

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work from 1 October this year. Althoughspot checks may somewhat cause a littleinconvenience, they are an effectivemeans to protect the interests of visitorsand deter non-Tourist Guide Pass holdersfrom receiving inbound tours. It is hopedthat members and tourist guides will fullysupport them.

TrainingFaced with a constantly changingbusiness environment, traders also needto be constantly upgrading themselves inorder to stay in the game. As such,providing training resources andopportunities for industry members hasalways been a dedicated aim of the TIC.Late last year, the Bonding Fund offereda HK$3,000 training subsidy to each

member, and HK$200,000 to each Association Member fororganising various kinds of educational and cultural activities for itsmembers. It is hoped that all members and Association Members willmake good use of the money to enrich their knowledge and explorenew opportunities despite the adversities.

As for other training activities, a seminar called “Value Creation: AKey to Success” was organised by the TIC on 18 February 2009,which was aimed at promoting a culture of value creation, therebyimproving members’ business performance. Given the potential ofcruise tourism, the TIC launched three cruise courses this year, whichshould help members to tap into this market. The Hong KongInformation Technology Federation (HKITF), subsidised by theGovernment again this year, was promoting the use of informationtechnology to SME travel agents. A seminar was already organisedby the HKITF, attended by about 65 people, and four training classeswere also arranged for about 180 people free of charge. After takingpart in these training activities, members should now be able toreduce costs and raise their competitive edge through IT solutions.

OthersThree members’ forums on ticketing, outbound and inbound issueswere respectively organised in November last year and March andJune this year so that members could get together, exchange viewsand explore future ways to tackle various kinds of difficulties facingthem. Responses to the forums were very good, with about 300member representatives present.

As the industry contributes much to Hong Kong’s economy and theTIC is responsible for self-regulating it, it is little wonder that membersand the public are expecting more and more of the TIC. A new sub-

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In a bid to help members to tide over the financial tsunami and the humanswine flu pandemic, the TIC invited the Trade and Industry Department andthe Hong Kong Tourism Board to brief members on assistance measures at abriefing held on 22 July.

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section, News for Members, was created in the Latest News sectionof the TIC website in the beginning of this year, which allowsmembers, after logging in, to browse the summaries of the minutes ofthe Board of Directors. To further increase transparency, the TIC willbegin to upload, starting from next year, the agendas and minutes ofthe Board and most committees to its website for members to read.Text messages about important news will continue to be sent tomembers as a means to boost communication.

Apart from the above, the TIC has to deal with a whole range ofdaily work and provide services for 1,405 Ordinary Members and89 Affiliate Members (as at 30 September 2009). I would like to takethis opportunity to thank all the directors and committee members fortheir dedicated involvement with tasks of the TIC, and all mycolleagues at the Executive Office for their sense of responsibility. Iwould also like to thank the many government departments andrelated organisations for their constant support. Now that the marketsare beginning to pick up, members should keep up their qualityservice and get prepared for a full economic recovery.

Joseph Tung JPExecutive Director

16 October 2009

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On 24 September, 340 tourist guides and tour escorts attended a seminar on how Hong Kongresidents can obtain mainland tourist guide and outbound tour escort permits, with representatives ofthe Guangdong Provincial Tourism Services Centre and the Shenzhen Tourism Association as guestspeakers.

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