Hong Kong’s retailers remain pessimistic about their industry prospects, with a survey from the Hong Kong Productivity Council suggesting that the sector’s business confidence is at three-year low.
The Standard Chartered Hong Kong SME Leading Business Index showed the retail industry sub-index sliding to 43.1 for the third quarter from 49.9 in the preceding three months, marking the weakest level in three years.
Meanwhile, the overall gauge of the SME Business Index stood at 49.6, up 0.6 point from the previous months but remaining below the 50 mark that separates positive and negative outlooks, the Hong Kong Economic Journal reported.
The sub-index that reflects interest in hiring dropped below 50 to reach 48.5 for the first time, according to the survey which was conducted by the Hong Kong Productivity Council in association with Standard Chartered Bank Hong Kong.
Kelvin Lau, senior economist for Asia at Standard Chartered, said slower growth in the number of mainland tourists and structural change in their consumption behavior have brought prolonged adverse impact on the city’s retail environment.
He noted a 1.3 percent fall in mainland visitors as of the end of May this year, the largest decline since August 2009.
However, DBS Bank Hong Kong economist Lily Lo said the actual impact is not so bad because 70 percent of retail sales in the city come from local consumers.
Lo expects Hong Kong’s economy to expand at 2.5 percent rate this year, with retail sales likely to recover.
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