Source: Zhitong Finance Author: Xu Wenqiang
Due to the weak performance of Hong Kong's economy and stock market, and Hong Kong people continue to spend in the north, the consumer atmosphere in Hong Kong is not good even as the Lunar New Year approaches.
On February 1, the Statistics Department of the Hong Kong Government announced that the total sales value of the Hong Kong retail industry was tentatively estimated at HK$36.3 billion in December 2023, an increase of 7.8% over the previous year. Chairman of the Hong Kong Retail Management Association, Tse Chiu An-yee, said that the increase was not very significant. Since December was originally the traditional peak sales season, and customs clearance was not fully completed in December 2022, it was expected that December last year would perform well. The performance of different retail categories was polarized. The travel-related retail categories all showed significant increases, while the Hong Kong market recorded declines. The total retail sales value for the whole year increased 16.2% year over year, in line with expectations.
Xie Qiu Anyi said that since January of last year was Lunar New Year, there will be a high base effect in January of this year. Coupled with mainland travelers not having long vacations, the performance of travel-related retail categories is weak, and growth is also slowing down. Due to the weak performance of Hong Kong's economy and stock market, and Hong Kong people continue to spend in the north, the consumer atmosphere in Hong Kong is not good even as the Lunar New Year approaches. Travel-related retail sales are expected to grow in single to low double digits, while retail sales in Hong Kong remain flat and even record a decline. There was a brief stimulus in the furniture and household goods industry. Due to the imminent garbage levy and the approaching Lunar New Year, Hong Kong residents took the opportunity to replace furniture, but within a short period of time, the industry's performance will return to normal.
Xie Qiu Anyi pointed out that the consumer atmosphere in the first half of this year was less than that of the first half of last year. The Association made an outlook for this year at the end of last year. It is expected that the total sales value of the Hong Kong retail industry will have a low double-digit decline in the first half of this year.
Looking ahead to the February Lunar New Year, Xie Qiu Anyi mentioned that the industry's confidence is still insufficient. The industry expects a low double-digit increase or decline in retail sales in Hong Kong. Positive factors include the longer vacations for mainland travelers this year and the complete lifting of epidemic prevention restrictions, such as masks; in addition, large-scale events during the holiday season will help attract travelers. Negative factors include Hong Kong people traveling north and abroad.
Lo Chun-pong, executive director of the Hong Kong Retail Management Association, said that the Association welcomes the Hong Kong government to continue to launch large-scale events, such as floats and fireworks, which can help attract visitors to Hong Kong. However, the spending power, consumption pattern and number of travelers have changed, and it remains to be seen whether visitors to Hong Kong can drive retail performance.
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