Disney May Expand Its Small World Into Hong Kong
Walt Disney Co. has agreed in principle to build a small Disneyland-style theme park on Hong Kong’s Lantau Island at a site with room to expand, Hong Kong’s financial secretary confirmed early today.
As now envisioned, the park would initially attract 5 million visitors a year--a fraction of the number that flock to Disney’s Magic Kingdom-style parks in Tokyo, Orlando, Paris and Anaheim.
But it would give Disney a firm toehold in the gateway to China and the Asia-Pacific region as it moves to expand its myriad entertainment and recreation businesses in the coming millennium.
While a broad understanding has been reached with Hong Kong government officials, the project remains in the “feasibility study” stage and both parties have set a June 30 deadline to make a final decision, Hong Kong Financial Secretary Donald Tsang said in his annual budget speech.
“The two sides have reached a common understanding,” Tsang said. He said the government and Disney officials would “commence intensive negotiations with a view to determining, by 30 June 1999, whether a Disney project can be brought to fruition in Hong Kong.”
No details of the project’s cost, ownership structure or financing were immediately available. A $6.5-billion estimate published in one Chinese news account is “vastly exaggerated,” a source said.
Disney opened the original Disneyland in 1955 and has since built an empire that includes four parks near Orlando, Fla., one near Paris and another in Tokyo. It is adding second parks with adjacent entertainment and hotel complexes in Anaheim and Tokyo to make those sites “destination resorts” more like Walt Disney World in Florida.
Officials have said Disney also will probably add a small second park at its complex in France, where it already operates hotels.
For long-term growth, Disney has studied untapped international markets such as Latin America, southern Europe, Shanghai and Singapore in addition to Hong Kong.
In a recent letter to shareholders, Chairman Michael Eisner said the time looked right for a major move into China.
Hong Kong, meanwhile, sees the Disney attraction as a catalyst to bring the struggling economy here out of its first deep recession in 50 years.
“Our assessment is that the development of a Disney project in Hong Kong would bring substantial economic benefits,” Tsang said. “It would create thousands of new jobs within the theme park itself. Many of these jobs would be well suited to young people just starting work, or the middle-aged left unemployed by economic restructuring.”
Hoping to duck criticism from environmentalists who oppose any new development on Lantau, a mountainous island near Hong Kong’s sprawling new airport with many public parks and religious sites, Tsang said the proposed park would be built on “reclaimed land.”
Tempest reported from Hong Kong; Reckard reported from Orange County.
