Hong Kong May retail sales rise 18.4%, sees support from local consumption
HONG KONG – Hong Kong’s May retail sales rose 18.4 percent from a year earlier in the sixth consecutive month of growth thanks to the revival of inbound tourism and positive consumption sentiment which should support growth in coming months, the government said on Monday.
Sales increased to HK$34.5 billion ($4.40 billion). That compared with a revised 14.9 percent rise in April and 40.8 percent growth in March.
Strict COVID-19 restrictions have weighed on Hong Kong’s economy since early 2020. But all border checkpoints were reopened fully in early February and the city dropped its COVID-19 mask mandate from March 1 in a move to lure back visitors and restore normal life.
The government launched a promotional campaign earlier in March called “Hello Hong Kong” to bring back tourists and businesses and also launched a “Happy Hong Kong” campaign in late May to boost local spending and the economy.
“Retail sales should continue to improve in the coming months,” a government spokesperson said. “The number of incoming visitors should continue to increase as transportation and handling capacity expand further.”
In volume terms, retail sales increased 16.5 percent year-on-year in May. That compared with a revised 13.1 percent growth in April and 39.3 percent growth in March.
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“Local consumption demand will continue to be supported by the improved labor market conditions, disbursement of the second installment of consumption vouchers, and promotional efforts by the government and the industry.” the spokesperson added.
The city’s industry body Hong Kong Retail Management Association launched “Happy Hong Kong Shopping Festival” from July 1 to August 31 with about 6,000 stores participating, offering discounts and other retail promotion to boost consumption.
Hong Kong’s seasonally adjusted unemployment rate stayed at 3 percent in the March to May period, the same as the previous quarter, after easing for 12 consecutive quarters.
The economy grew 2.7 percent in the first quarter from a year earlier thanks to the strong recovery of tourism and domestic demand, which should remain drivers of growth this year. The government has maintained its economic growth forecast of between 3.5 percent and 5.5 percent for 2023.
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Tourist arrivals in Hong Kong in May fell slightly to 2.83 million from 2.89 million in April, but jumped sharply as compared with 18,710 visitors in May 2022 when China was still observing strict controls to prevent the spread of COVID-19.
Among the arrivals, mainland Chinese visitors eased slightly to 2.29 million in May from 2.31 million in April, Hong Kong Tourism Board data showed.
In May, sales of jewelry, watches, clocks and valuable gifts, which before the pandemic were mostly to mainland tourists, surged 51.8 percent from a year earlier as compared to a 75.1- percent jump in April, data showed.
($1 = 7.8342 Hong Kong dollars)
