19 October 2018
Luxury goods such as jewelry and high-end watches took the most hit amid a retail sales slide in Hong Kong in January. Photo: Bloomberg
Luxury goods such as jewelry and high-end watches took the most hit amid a retail sales slide in Hong Kong in January. Photo: Bloomberg

HK retail sales down 14.6% on year in Jan; worst drop since 2003

Hong Kong recorded a 14.6 percent decline in retail sales in January compared to the same month last year, according to figures released Tuesday by the city’s Census and Statistics Department.

It marked the biggest such drop since 2003 when the city was hit by the severe acute respiratory syndrome (SARS), and was worse than the 6.1 percent decline that had been expected by the market, Ming Pao Daily noted.

Except for autos and parts, appliances and furniture, sales of all the other items fell in January.

Luxury goods saw the biggest drop, with sales of jewelry, watches and expensive gifts down 21.4 percent year on year. Clothing sales slumped 13.8 percent.

Sales at supermarkets and department stores dropped 13.1 percent and 11.3 percent, respectively.

Miscellaneous durable goods, including mobile phones, saw a reversal of the uptrend that was seen in the second half last year, as their sales plummeted 44.1 percent in January.

Caroline Mak, chairwoman of the Hong Kong Retail Management Association (HKRMA), said she has begun to feel pessimistic on the retailing industry’s prospects for the full year.

If weakness persists, the city could see a wave of large-scale store closures and worker layoffs, she said.

Mak noted that many store operators in the main shopping districts are hesitating to renew their leases.

Given the challenging environment, it is a pity that Hong Kong is witnessing protests against mainland shoppers and the so-called parallel traders, she said, pointing to the latest incidents in Yuen Long over the weekend.

If Hong Kong people are hostile to cross-border visitors, it will impair the goodwill and affect the flow of inbound visitors, Mak said, adding that demonstrators should note that the livelihoods of other locals are at stake.

The government attributed the sharp decline in January sales partly due to the timing of the Lunar New Year which fell in February this year, in contrast to 2014 when the festival was in late January.

Mak, however, feels the problems go much deeper than the timing of the Lunar New Year, and said the prospects for the full year are not bright.

A study on 52 chain stores by HKRMA found that most of them recorded sales that were either unchanged or down from a year earlier during the Lunar new Year holidays last month. Sales of cosmetics, drugs, jewelry, watches and appliances suffered double-digit declines.

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