Hong Kong retail sales fall again in August
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Hong Kong retail sales plunged 13.1 percent year on year in August, as the coronavirus pandemic continued to batter the struggling sector, marking a 19th consecutive month of contraction. Consumer spending dropped to HK$25.6 billion (US$3.2 billion) in August, contributing to sales for the first eight months of the year falling 30 percent from the same stretch in 2019, according to provisional figures released by the Census and Statistics Department on Wednesday.
The monthly year-on-year decline was not as steep as recorded recently, but that was mainly attributed to the data comparison with last August when the city was gripped by anti-government protests.
“I hope everyone can understand that and won’t be misled by the figure,” said Annie Tse Yau On-yee, chairwoman of the Hong Kong Retail Management Association, adding this August’s slump reflected a serious situation for the industry.
The total value of retail sales in the city between January and August this year was HK$213 billion, compared with HK$305 billion for the same period last year.
Most retailers continued to suffer a contraction in sales in August, with supermarkets once again among the exceptions, a trend Tse linked with residents staying in to cook during the city’s third wave of Covid-19.
All eyes are on how retail businesses perform between October 1 and October 4, which is traditionally a peak period for sales because of the National Day holidays, popularly known as “golden week”.
Previously, millions of mainland Chinese would travel domestically and overseas during the break but would be kept away from Hong Kong this year by the city’s travel restrictions for the pandemic.
Tse noted that sales might improve for those selling goods relating to people’s daily lives, such as furniture and food, due to the long weekend in Hong Kong overlapping with the Mid-Autumn Festival.
“The help for sectors which had continued to record a decline in sales would be minimal.”
“But everyone predicts it will help boost the footfall rather than sales. Maybe due to the ease of pandemic, then the foot traffic, in general, will be better… the sales will still remain weak,” she said.
“The help for sectors which had continued to record a decline in sales would be minimal.”
A government spokesman said as economic conditions remained under pressure and inbound tourism was unlikely to recover in the short term, the business environment would continue to be difficult.
“Nonetheless, local consumption sentiment may further improve if the recent stabilization of the local epidemic situation sustains,” he said.
After the third wave of infections intensified in July, evening dine-in services were banned in Hong Kong restaurants for nearly 1½ months, only reopening in late August. Most entertainment premises such as bars and karaoke lounges also remained closed in August, dampening consumer sentiment across the city.
The ongoing global lockdown also played a role in subdued consumption, as tourist arrivals to the city collapsed 99.9 percent, with fewer than 4,500 people in August.
Questions & Answers
Q.What was the total value of retail sales in Hong Kong for the first eight months of this year?
What was the total value of retail sales in Hong Kong for the first eight months of this year?
Between January and August this year, the total value of retail sales in the city was HK$213 billion. This figure represents a decline compared to HK$305 billion for the same period last year.
Q.Why was the year-on-year decline in August not as steep as in previous months?
Why was the year-on-year decline in August not as steep as in previous months?
The less steep decline in August was mainly attributed to the data comparison with the same month last year. Hong Kong was experiencing anti-government protests in August 2019, which also impacted sales figures then.
Q.Which retail sectors were exceptions to the general sales contraction in August?
Which retail sectors were exceptions to the general sales contraction in August?
Supermarkets were once again among the exceptions to the general sales contraction in August. This trend is linked to residents staying indoors to cook during the city’s third wave of Covid-19 infections.
Q.What impact are the upcoming National Day holidays expected to have on retail sales?
What impact are the upcoming National Day holidays expected to have on retail sales?
The National Day holidays are traditionally a peak period, but mainland Chinese tourists will be absent this year due to travel restrictions. While foot traffic might improve, overall sales are still predicted to remain weak, with minimal help for struggling sectors.