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Friday, January 04, 2019, 11:28
HK retail sales sluggish in November
By Edith Lu
Friday, January 04, 2019, 11:28 By Edith Lu

In this Nov 29, 2018 photo, Chinese mainland tourists walk past a Tiffany & Co flagship on the Canton Road, the one-stop-shop high street of high-end brands in Hong Kong. (KIN CHEUNG / AP)

After the sharp recovery in October last year, retail sales in Hong Kong fell short of market forecasts the following month, posting modest growth of just 1.4 percent year-on-year - the slowest pace of growth for the sector since June 2017.

The total value of retail sales in November last year amounted to HK$39.2 billion, buffeted by the ongoing Sino-US trade spat, as well as various external uncertainties, according to the Census and Statistics Department.

The narrowing retail sales growth is obvious compared with a 6-percent jump last month. But, I’m neither shocked nor surprised to see that as within expectations

Annie Tse Yau On-yee, Chairwoman, HKRMA

"The narrowing retail sales growth is obvious compared with a 6-percent jump last month. But, I’m neither shocked nor surprised to see that as within expectations," said Annie Tse Yau On-yee, chairwoman of Hong Kong Retail Management Association (HKRMA).

She noted that Hong Kong hosted nearly 6 million tourists in November, most of whom were from the Chinese mainland and part of day-trip tour groups. The figure is considered high, fueled by the opening of the Hong Kong-Zhuhai-Macao Bridge and the Hong Kong section of the Guangzhou-Shenzhen-Hong Kong Express Rail Link.

“Day-trip visitors boosted sales of consumer goods, such as medicine and cosmetics, while overall retail sales were mainly driven by overnight visitors,” said Tse. “However, overnight visitor arrivals recorded just a 5.3-percent increase in November.”

The value of medicine and cosmetics sales registered a 10.1-percent rise, while that of luxury gifts, including jewelry, watches and clocks, saw negative growth of 3.9 percent - the worst performance of the category since November 2016.

According to HKRMA member companies, Christmas holiday sales growth stayed flat although December is, traditionally, a peak month for retailers.

Looking ahead, Tse reiterated her forecasts of low single-digit growth for the retail business in 2019, which could be below 5 percent. She’s positive about sales of consumer goods with low prices, but not confident for luxury products.

“It’s difficult to predict when the consumption downturn will end at which level although the Sino-US trade stand-off is likely reach a settlement,” she said.

Tse urged the SAR government to improve transportation facilities for the XRL and the HZMB, and see if it’s possible to attract more overnight visitors to benefit the entire retail industry.


edithlu@chinadailyhk.com

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