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Hong Kong Retail Sales Plummet 79% in February
Mar 31, 2020 8:57 AM
By Rapaport News
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RAPAPORT... Sales of jewelry and other hard-luxury items in Hong Kong slumped to an all-time low in February due to the coronavirus, according to government data.
Revenues from jewelry, watches, clocks and other valuable gifts dropped 79% year on year to HKD 1.56 billion ($200.6 million) for the month as tourists stayed away and local demand fell. Sales in all retail categories declined 44% to HKD 22.74 billion ($2.93 billion), the municipality’s Census and Statistics Department reported Tuesday.
“The year-on-year fall in retail sales volume widened sharply in February and was the steepest for a single month on record,” a government spokesperson said. “This mainly reflected the heavy blow to tourism- and consumption-related activities dealt by COVID-19, though the distortions from the timing of the Lunar New Year also contributed.”
The Chinese New Year occurred on January 25 this year, whereas last year it was on February 5. That meant festive purchases were more weighted toward January than they were in 2019, creating a negative effect on February sales. Still, revenues in the hard-luxury category were down 59% to HKD 6.49 billion ($836.6 million) for the first two months of 2020, as sales were sluggish in January even before the heavier effects of the coronavirus hit.
Tourism from mainland China, a crucial source of revenue for Hong Kong’s luxury industry, has slowed in the past year due to pro-democracy protests in the territory and the weak Chinese yuan. The virus outbreak exacerbated the downturn, with the city imposing a two-week quarantine for all visitors from the mainland in early February. Arrivals from that location dived 98% to 98,804 for the month, while tourist numbers from around the world dropped 96% to 199,123, according to the Hong Kong Tourism Board.
“The business environment of retail trade will remain extremely austere in the near term, as the COVID-19 pandemic has brought inbound tourism to a standstill and severely dented local consumption demand,” the government spokesperson added. “The government will closely monitor the situation and its repercussion on the overall economy and the employment market.”
Image: A woman at a shopping mall in Hong Kong, February 15, 2020. (Shutterstock)
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Tags:
China, Coronavirus, COVID-19, Hong Kong, Jewelry, mainland china, Rapaport News, retail, tourism
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