Hong Kong Retail Sees Gradual Recovery

RAPAPORT… Hong Kong recorded its gentlest decline in hard-luxury revenues for a year and a half, as a drop in coronavirus cases boosted the local retail market.

Retail sales of jewelry, watches, clocks and valuable gifts fell 16% year on year to HKD 2.78 billion ($358.3 million) in November, according to data Hong Kong’s Census and Statistics Department released Monday. Sales across all retail categories slipped 4% to HKD 28.73 billion ($3.71 billion).

The figures compared favorably with slumps of up to 79% for the hard-luxury segment during the worst months of the crisis. The pandemic has hit the municipality heavily: Local retailers are highly dependent on tourist business, and especially visitors from mainland China.

New daily Covid-19 infections in the municipality were in the single figures in the first half of November, as a lull that began in September continued into its third month, according to statistics website Worldometer. However, a fourth wave caused the situation to deteriorate in the second half of the month and in December, with authorities introducing tightened rules that are likely to last until the crucial Chinese New Year period and beyond.

“As inbound tourism remains at a standstill, and the fourth wave of the local epidemic has weighed on local consumption sentiment since the latter part of November, the business environment of the retail trade will remain challenging in the near term,” a government spokesperson explained.

A combination of the virus and pro-democracy protests in Hong Kong has dented retail sales in the city since mid-2019. The territory has seen 22 consecutive months of year-on-year declines in sales of jewelry and other hard-luxury items, with the November fall the softest since May 2019’s 2.9% slowdown.

Image: Hong Kong. (Pixabay)