In a move meant to ease tensions between Hong Kong residents and the mainland Chinese tourists who visit their city, China announced a new internal visa policy Monday that will cut visits to Hong Kong by residents from the neighbouring city of Shenzhen. Effective immediately, Shenzhen residents will be allowed only one entry to Hong Kong per week, instead of unlimited entries under the previous permit system, the state-run Xinhua News Agency reported on Monday. Hong Kong Chief Executive C.Y. Leung said Monday that the new policy specifically targets professional "parallel traders," referring to mainlanders who take advantage of multiple-entry policy to import goods from Hong Kong to the mainland. He said Hong Kong's government had requested Beijing to cancel the multiple-entry permit policy last year, following demonstrations by some Hong Kong residents accusing mainlanders of causing scarcities of some goods and driving up prices of others. However, some Hong Kong legislators argued that the policy will not reduce parallel trading, but would instead adversely affect the business of local retailers. Stocks of Hong Kong retailers declined broadly Monday morning, as cosmetics chain store Bonjour Holdings Ltd. sank 7.1% during the morning session, while rival Sa Sa International Holdings Ltd. slid 5.8%, and jewelery retailer Chow Tai Fook Jewellery Group Ltd. fell 4.6%.
Copyright © 2015 MarketWatch, Inc.
Continue Reading Below