RAPAPORT... Sales of jewelry and other luxury items in Hong Kong slid in November as social unrest continued to hinder inbound tourism and weaken consumer sentiment.
Revenue from jewelry, watches, clocks and other valuable gifts fell 44% year on year to HKD 3.34 billion ($428.9 million) during the month, the municipality’s Census and Statistics Department reported last week. Sales across all retail categories slipped 24% to HKD 29.97 billion ($3.85 billion).
Demonstrations against an extradition bill have been ongoing since June, interfering with retail sales and hitting local consumer sentiment and tourism. Although the bill has since been scrapped, violence in the municipality is escalating.
“Retail sales continued to fall sharply in November as the local social incidents turned extremely violent, causing very severe disruptions to tourism- and consumption-related activities, and further dampening consumption sentiment,” a government spokesperson noted.
November’s sales, the tenth consecutive month of declines, showed the second-sharpest decrease for jewelry since the Census and Statistics Department began publishing results in 2005. The steepest drop on record was in August, when sales slid 47%.
The political situation has led to a sharp drop in travelers from China and abroad, as well as weakened local purchasing. Tourism in Hong Kong was down 56% year on year to 2.6 million visitors in November, the Hong Kong Tourism Board reported. Of those, 1.9 million came from mainland China, 58% fewer than the same period last year. The troubles have also led Louis Vuitton to close its store in the Times Square mall in Causeway Bay, as it can no longer run it profitably, the South China Morning Post reported last week.
The government expects weakness in the market to continue as conditions persist, stressing that the market will likely not improve until the unrest subsided.
“The near-term outlook for the retail trade continues to hinge on how the local social incidents will evolve,” the spokesperson added. “As such, ending violence and restoring social order are essential to the recovery of the retail trade, and indeed, that of the whole economy.”
In the first 11 months of the year, retail sales of jewelry, watches, clock and other valuable gifts decreased 21% to HKD 61.01 billion ($7.84 billion). Sales in all retail categories for the same period fell 10% to HKD 395.03 billion ($50.78 billion).
Image: Victoria Harbor, Hong Kong. (Pixabay)
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