Hong Kong Luxury Sales Grow Amid Tourism Spike

Hong Kong retail sales continued to improve in May as the number of visitors to the municipality rose and consumer sentiment increased.

Revenue from jewelry, watches, clocks and valuable gifts jumped 52% year on year to HKD 5.08 billion ($648.8 million) for the month, according to data the government’s Census and Statistics Department released Monday. Retail sales across all product categories climbed 18% to HKD 34.47 billion ($4.4 billion).

The growth also reflected a favorable comparison with the same period a year ago, when Hong Kong was on lockdown and strict Covid-19 restrictions were in place. During that time, the number of visitors remained extremely low. Hong Kong derives a large percentage of its luxury revenue from tourists, primarily from the mainland, who travel to the municipality to purchase goods. Hong Kong reopened its border with China in January.

For the first five months of 2023, proceeds from jewelry, watches, clocks and valuable gifts surged 77% year on year to HKD 24.85 billion ($3.17 billion). Total retail sales for the period advanced 21% to HKD 171.94 billion ($21.95 billion).

In May, 2.8 million visitors arrived in Hong Kong, compared to only 18,710 during the same month last year. Of those who traveled to the municipality in May, 2.3 million were from the mainland, versus 14,403 in 2022.

“The value of total retail sales continued to increase visibly in May over a year earlier thanks to the revival of inbound tourism and positive consumption sentiment,” a government spokesperson said. “Retail sales should continue to improve in the coming months. The number of incoming visitors should continue to increase as transportation and handling capacity expand further. Local consumption demand will continue to be supported by the improved labor market conditions, disbursement of the second installment of consumption vouchers, and promotional efforts by the government and the industry.”