Hong Kong retail sales up 12.1 per cent year on year in April, marking slowdown in momentum of sector’s recovery

·3-min read

Hong Kong retail sales in April rose 12.1 per cent year on year, marking a slowdown in momentum for the industry’s recovery even as the Covid-19 crisis continued to abate.

Provisional figures released by the Census and Statistics Department on Tuesday showed sales that month totalled HK$27 billion (US$3.47 billion) – their lowest level since October.

The increase followed a 30 per cent year-on-year jump for February – the highest climb on record – and 20.2 per cent growth in March.

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Taken as a whole, retail sales in the first four months of 2021 were estimated to have grown 8.5 per cent compared to the same period last year.

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A government spokesman attributed April’s growth to the low basis of comparison last year.

“But retail sales volume was still far below its pre-pandemic level, as inbound tourism remained frozen,” he added.

The spokesman said the near-term outlook for the industry would remain challenging, as tourism was unlikely to recover any time soon amid the global pandemic.

Residents embracing the city’s sluggish vaccination drive would also be essential to creating favourable conditions for a stronger business revival, he added.

Online retail sales were up 27.2 per cent year on year in April, totalling HK$1.8 billion and accounting for 6.8 per cent of the city’s total.

Online retail sales were up significantly in April, as was spending on clothing and luxury goods. Photo: Nora Tam
Online retail sales were up significantly in April, as was spending on clothing and luxury goods. Photo: Nora Tam

Clothing sales surged 64.7 per cent, while the amount spent on luxury goods like jewellery, watches, clocks and other valuable gifts nearly doubled, jumping 93.2 per cent.

Sales in supermarkets and department stores, however, dropped 12.7 per cent and 22.2 per cent, respectively.

The coronavirus pandemic has dealt a heavy blow to the retail sector, which banks on tourist spending and strong local consumer sentiment.

The number of local coronavirus cases confirmed daily in the city was largely stable in April, hovering between zero and eight.

But Hong Kong also recorded its first cases involving mutated strains of the virus in the community that month, leaving health experts and residents fearful that the more infectious variants could spread locally.

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The Hong Kong Retail Management Association said based on the assumption there would not be another wave of infections and cross-border travel would remain stringently restricted, it expected the government’s digital voucher scheme to help drive up consumer sentiment.

It forecast mid-to-high single-digit growth in the retail sales figure in the second half of 2021 and for the whole year.

Simon Lee Siu-po, co-director of the international business and Chinese enterprise programme at Chinese University, said April’s year-on-year growth wasn’t as impressive as February’s because the basis of comparison for that month was even lower, given the coronavirus had first taken off in the city in the first two months of 2020.

Still, he added, “the growth rate [for April] seems to have slowed down.”

Lee said he expected retail sales in May would be up year on year, but dampened somewhat by school examination season and the fact that the city remained almost totally shut off to visitors.

This article Hong Kong retail sales up 12.1 per cent year on year in April, marking slowdown in momentum of sector’s recovery first appeared on South China Morning Post

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