Retail Sales in Hong Kong Plunge 11.8% in July Amid Changing Consumer Trends

Retail Sales Influence in Hong Kong Post-Summer Travel

Hong Kong's retail sales have contracted for a fifth consecutive month, with figures from the Census and Statistics Department indicating an 11.8% year-on-year drop in July, reducing sales to HK$29.1 billion (US$3.73 billion). This decline follows a 9.7% decrease in June, highlighting a persistent trend exacerbated by altered consumption patterns amidst the ongoing coronavirus pandemic.

Key Factors Affecting Consumer Spending

A government representative attributed the downturn to factors including strong foreign exchange rates and increased summer travel among residents. In the initial seven months of 2024, retail sales have fallen by 7.3% when compared to the same timeframe last year.

Government Measures to Revitalize Retail

To counter this slump, the Hong Kong government is rolling out measures aimed at promoting a mega event economy and enhancing market sentiment. Programs under the Dedicated Fund on Branding, Upgrading & Domestic Sales (BUD Fund) are being launched to help local enterprises leverage the mainland Chinese market through e-commerce strategies.

Sales Breakdown Across Categories

• Motor Vehicles and Parts: down 27.9% year-on-year
• Jewelry, Watches, and Clocks: down 25%
• Chinese Medicinal Drugs and Herbs: down 24.9%
• Department Stores: down 24.3%

The digital transformation support pilot programme is expected to bolster small and medium enterprises, facilitating their transition to effective digital solutions.