The number of visitors to Hong Kong is expected to drop during Christmas but the city's New Year countdown celebration may attract more travelers in the long run.

The Hong Kong Tourism Board (HKTB) said the number of visitors to Hong Kong dropped 1 percent last month compared to the same period in 2007 and the December number could also be weaker.

The long-haul travel market was particularly badly hit by the financial turmoil. About 10 to 11 percent fewer long-haul tourists came to Hong Kong this month, a slight improvement from the Olympic period that saw a 13 percent drop.

Anthony Lau (center), executive director of the Hong Kong Tourism Board, announces the board will ramp up investment to boost Hong Kong's travel market. [CNS]

Hotel occupancy rates this month have also plummeted and are down as much as 20 percent year-on-year, despite hopes by the Federation of Hong Kong Hotel Owners to maintain the whole-month performance at the same level as last year.

"If the tourists remain conservative in consumption, the long-haul market would not improve in the short term," said HKTB Executive Director Anthony Lau, adding that the travel industry might become stable by the fourth quarter next year at the earliest.

By contrast, the short-haul market started to recover, with growth seen in the number of mainland tourists recently.

Travel Industry Council of Hong Kong Executive Director Joseph Tung Yao-chung is optimistic about the Christmas market.

"Most of our visitors during Christmas come from the mainland, so there should be growth overall," he said.

The HKTB plans to invest more resources to promote the short-haul market while seeking to attract more business tourists.

Tung said industry is also looking at promotions with hotels and theme parks to lure travelers.

Lau expects the New Year countdown celebration - being held this year for the second time - to be another attraction to overseas tourists.

The celebration costs about HK$6 million, half sponsored by two property developers.

The choreographed musical pyrotechnic show will last five minutes instead of two in 2007.