A senior finance official in the 1980s once scoffed at suggestions for the government to invest in developing the tourism industry. His reason was that the return from tourism income could never justify the large capital outlay.

He was proven right by the cash-strapped Ocean Park, which is seeking government subsidies to stay in business. The problem of this iconic theme park so dear to the hearts of many Hong Kong people growing up in the 80s and 90s is rooted in its strategy which seemed to make eminent business sense when it was hatched years ago.

The park was built originally as one of the few well-organized and properly managed recreation facilities for Hong Kong people at a time when the privately-run theme parks were shut down for redevelopment into residential complexes. The initial capital outlay was large by the standard of the time.

The park was never a money spinner. But it was popular among local patrons when it was the only choice for families to spend a weekend together away from home.

The influx of tourists from the Chinese mainland after the relaxing of entry permit restrictions in 2003 has drastically changed the business landscape in Hong Kong. Many retail outlets and restaurants have adopted a new business model catering mainly to the free-spenders from the mainland.

Hotels were sprouting everywhere, even in some of the most unlikely districts in factory or residential areas. Many new retailers, such as drug stores and dried seafood outlets sprang up in the commercial districts, squeezing out the traditional shops frequented by local consumers.

Jumping onto the tourism bandwagon, Ocean Park invested heavily new attractions that were costly to build and operate to woo tourists. The added cost has pushed up admission fees to levels for which fewer and fewer Hong Kong people were willing to pay.

The plan backfired when tourist arrivals began to drop as Hong Kong lost its competitiveness against other tourist destinations mostly because of the excessive greed of its many merchants and their landlords. Ocean Park faces the addition problem of stiff competition from the many new theme parks in the region.

The tourism boom as seen in the past decade is not expected to return. The entire tourism industry, not just Ocean Park, will have to adapt to the stark reality to survive.