Hong Kong Retail Sales Rise in August as Mainland China Tourists Return

2023-09-29 17:19

Hong Kong’s retail sales rose in August as mainland Chinese tourists returned to the city, providing an encouraging

Hong Kong’s retail sales rose in August as mainland Chinese tourists returned to the city, providing an encouraging lift for an economy that’s been trying to revive its image as a shopping hub.

Retail sales by value rose 13.7% from a year ago, the Census and Statistics Department said Friday. That was less than the median estimate of a 15.8% increase in a Bloomberg survey of economists, and compares to a weak base from 2022 when the city still had some pandemic curbs.

Sales by volume grew 11% from a year prior.

A government spokesman said that the value of total retail sales continued to register visible year-on-year growth in August, thanks to a further increase in visitor arrivals.

Mainland Chinese tourists over the summer contributed to the jump, although levels still trail pre-pandemic levels. Visitors arrivals rose to 4.08 million in August, up 14% from the month before, according to figures published by the Hong Kong Tourism Board.

The government is hoping that a tourism recovery can fuel growth this year, though there have been challenges to those efforts as the city struggles to regain its appeal as a retail paradise.

Tourism’s contribution to the economy fell to 0.1% of its gross domestic product at the height of the city’s Covid isolation from about 3.6% before the pandemic. To attract more visitors and boost consumption, the city earlier this month launched a campaign to stimulate its nightlife. The push features three evening bazaars along the city’s famous Victoria Harbour and special events in bars and attractions.

The retail data covers consumer spending on goods but not services such as catering, medical care and entertainment. Those services account for over 50% of the total consumer spending.

The city’s economic recovery has shown some signs of trouble as GDP rose at a weaker-than-expected pace in the second quarter and Financial Secretary Paul Chan flagged concerns about muted spending habits among residents. Slower global demand has weighed on Hong Kong’s exports, which in August posted their longest streak of monthly declines on record.