Sales slide worst in 13 years for Hong Kong Retail
Feb 9, 2016
Hong Kong retail sales fell 3.7 percent last year the worst in 13 years, including the 2.3 percent slide during the 2003 SARS epidemic with a gloomy outlook also forecast for this year.
Retail sales fell to HK$475 billion, with volume slipping 0.3 percent, a second straight annual decline, the Census and Statistics Department said.
In December, when the tourism board counted nearly 11 percent fewer visitors from a year earlier, total sales value fell 8.5 percent much worse than the 4.3 percent drop projected by analysts. The slump widened from 7.8 percent in November, and was the largest since January 2015.
Sales of jewelry, watches, clocks and valuable gifts were among the hardest hit, slumping 17 percent in December and 16 percent for the full year. Clothing and department store sales also declined.
Hong Kong Retail Management Association chairman Thomson Cheng said the situation, which fell back to the level seen in 2002, is “worrying.”
Cheng expects a high single-digit slump in retail sales for the first quarter this year, and full-year retail sales to drop at least 3 percent.
Erwan Rambourg, a retail analyst at HSBC in Hong Kong, said high-end watch and jewelry sellers suffered as mainland shoppers avoided lavish purchases, while falling currencies in other Asian nations reduced prices for goods bought elsewhere.
Visitors from the mainland fell 16 percent in December from a year earlier, the tourism board said last week. Total visits to Hong Kong fell 2.5 percent last year to 59.3 million.
ANZ noted visitor spending made up a large portion of more than 42 percent of retail sales in 2014.
“Given the depreciation of the yuan and other currencies against the Hong Kong dollar, the tourism and retail sector will continue to face headwinds in 2016,” ANZ said.
Retail sales were down on an annualized basis every month from March through December, according to Bloomberg data.
Chow Tai Fook Jewellery Group (1929) said last month that sales during Lunar New Year would be challenging.
Source: Retail News Asia