Hong Kong and the Future of Foodservice Trends

Hong Kong has never been far from the headlines and political debate and this intensified when sovereignty was transferred to China in 1997. Since then the region has endured ‘special administrative’ status as residents and business owners struggle with what was viewed as the growing influence of China in the territory. 

On paper back in 1984, the ‘one country, two systems’ idea would supposedly see Hong Kong enjoying a high level of autonomy, except in foreign and defence affairs. However, as supposed Chinese involvement in Hong Kong affairs continued to grow, tensions mounted.

During 2019, anger spilled onto the streets as pro-democracy supporters and a richly westernised population began a series of protests against Beijing’s growing influence locally. This has left Hong Kong facing one of the worst political crises in decades. 

Perhaps not surprisingly, most locals identify as ‘HongKongers’ according to reports from the University of Hong Kong, with more than 71% of those surveyed revealing they do not feel proud about being Chinese citizens – an all-time record low.

An uncertain future for tourism?

So where does this leave the needs of Hong Kong’s 7.4m people of various nationalities and how can it attempt to maintain the status quo whilst preserving its hugely significant tourism industry, which saw more than 58m people visit in 2017?

As a busy trading port and manufacturing hub Hong Kong has always been a popular destination for travellers and migrants and those political, social and cultural differences have made it a destination of choice for tourists, many of whom come to experience landmarks such as Star Ferry and Victoria Park, but also its temples, shrines and in particular its bustling food markets.

Indeed, it’s almost a century since Western dishes first became trendy among locals and this, alongside Hong Kong’s status as a major trading hub and key gateway to mainland China, has ensured its longevity as one of the world’s leading gourmet dining centres with an amazing array of dishes and influences.  

A cursory glance at 2019’s Michelin Guides gives a better understanding of Hong Kong’s position as a powerhouse in the global restaurant space. In the UK there are just five restaurants holding three Michelin stars. In Hong Kong and Macau there are 10, with a further 17 two-star and 55 one-star restaurants.

Zero tariffs and lower barriers to entry

Hong Kong’s unique position and status leaves little room for error, with zero tariffs and low barriers to entry ensuring an extremely transparent competitive market where even high quality products are often left competing on price.

Whereas as recently as the 1950s, almost all food consumed in Hong Kong was produced in the surrounding area, there has since been a drop-off in local agricultural production that, at best, can be described as minimal, despite a few local initiatives to address this situation. 

Dairy a significant part of imports

Today, Hong Kong imports around 95% of its local food requirements, with dairy playing a significant part there. Such imbalances present their own problems and, although a tourist hotspot, with its weak economy (3%, versus average 5.2% over 1974 – 2018) Hong Kong is not immune to wider market conditions and like many other countries has been affected by an ongoing trade war between the US and China. 

Its sluggish economy and uncertainties surrounding trade disputes alongside an already weakened stock market mean that foodservice forecasts are also poor, with limited growth in demand for cheese over the next two years. Another point to mention is Hong Kong’s unequal distribution of wealth which means a significant proportion of its consumers are only able to eat out semi-regularly. 

That’s why some, such as Alvin Leung, chef-owner of three-Michelin-starred Bo Innovation, saw 2019 as being a ‘difficult year’ for fine dining, with restaurant owners having to regroup and plan for the long-term.

Like several of his contemporaries he believes that ‘innovative cuisine’ has the most to lose in the current climate and feels that any innovation may take place towards the mass and lower-end of the market.

A growing trend towards Japanese and Korean Food

Yet in recent years Hong Kong has seen a growing local awareness and fuelled interest in Japanese and Korean food trends in both consumers and foodservice operators. 

This saw a swathe of new Japanese openings – such as Sushiro, Japan’s top kaiten sushi chain and the 24-hour beef bowl rice restaurant, Sukiya – to go alongside stalwarts like Nadaman, as Hongkongers continued to indulge in sushi, tempura, kaiseki and teppanyaki, whilst paying top dollar for omakase dinners (where diners put their trust in the resident chefs).

At the same time, a growing focus on food safety and healthy eating has seen interest in organic and natural foods rise as consumers wish to know the provenance of ingredients as well as their environmental impact. 

On the frontline, this has had an impact on certain dishes, such as shark fin soup. Late last year Maxims announced that it would cease sales from 2020 and is one of a number of brands to acknowledge the changing landscape. Provenance works in other ways too. This year the restaurant chain Café de Coral responded to a critical Greenpeace study by announcing that it will no longer offer plastic straws at outlets.

Dairy and a healthier future?

So, what does this mean for the future for Kong Hong? Well, in terms of dairy market analysis, an interesting point to note is that consumers are seeking out healthier cheeses whilst adopting fashionable new trends such as cream cheese topped milk tea, a frothy combination of milk, cream cheese and salt added as a topping to an iced tea of your choice.

At the same time they’re demanding changes to the way in which foods are produced with a renewed focus on safety and healthy eating. This is in line with the trend towards sustainability and those foods produced in an environmentally friendly way. This has seen Chinese consumers embracing the idea of zero-waste stores as restaurants such as John Anthony, at Causeway Bay’s Lee Garden Three, looking ‘to push the boundaries of culinary innovation, and set a new standard of eco-consciousness’ by operating on sustainable practices. 

Hong Kong in 2020 and beyond

In 2020, it’s expected that the trend towards fusion will continue, as HongKongers continue to indulge their senses in a heady mixture of Korean and Italian dishes alongside Mexican-Japanese restaurants and Anglo-Indian offerings. And while these offer some interesting takes on bibimbap and pairings such as kimchi tomato bruschetta, veganism and a continued drive locally towards plant-based alternatives are expected to create new headlines as consumers embrace new innovation at the bar in the form of new tea-infused cocktails known as Teatails. 

Yet, in all of this, it remains to be seen how the political situation will develop and whether ongoing protests will have a negative impact on Hong Kong’s foodservice sector – both in terms of local HongKongers eating out less and a drop off in tourist numbers.