Government Stimulus Drives Hong Kong Retail Sales

RAPAPORT… Sales of jewelry and other hard-luxury items rebounded in August amid the launch of a government-backed stimulus program.

Revenue from jewelry, watches, clocks and other valuable gifts climbed 28% to HKD 3.17 billion ($406.9 million) during the month, the municipality’s Census and Statistics Department reported Thursday. Sales across all retail categories rose 12% to HKD 28.6 billion ($3.67 billion).

“Year-on-year growth…picked up notably…in August, thanks to the boost from the consumption-voucher scheme,” a government spokesperson explained.

Last month, the Hong Kong government implemented a program to stimulate spending by offering citizens vouchers worth HKD 5,000 ($642) to support domestic purchases. The luxury market in Hong Kong — a major destination for tourists — had been hit hard by the Covid-19 pandemic and related travel restrictions.

The stable coronavirus situation and improved labor market also helped buoy sales, the spokesperson noted.

In the first eight months of the year, sales of jewelry, watches, clocks and other valuable gifts jumped 32% to HKD 25.08 billion ($3.22 billion). Sales across all categories for the period grew 8% to HKD 230.16 billion ($29.57 billion).

“The [consumption-voucher scheme] should continue to bode well for local consumption sentiment in the rest of the year,” the spokesperson added. “Nevertheless, keeping the epidemic under control remains pivotal to a full-fledged recovery of the retail sector and the overall economy.”

Image: Tsim Sha Tsui shopping district, Hong Kong. (Shutterstock)