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Hong Kong retail sales growth slows in January as tourism numbers drop

Hong Kong retail sales growth slowed to just 0.9 percent in January, as tourist arrival numbers declined during the month.

SEE ALSO: Hong Kong retail sales lift 16 percent in 2023 despite softer December gains

Sales increased to HKD 36.5 billion (USD 4.7 billion) in January, the Hong Kong government said.  While it was the 14th consecutive month of retail growth, the increase was soft compared with a 7.8 percent growth in December, 15.9 percent surge in November and a 5.8 percent rise in October; leading to a 16 percent increase in retail sales in Hong Kong in 2023.

By category, sales of jewelry, watches, clocks and valuable gifts rose 25.2 percent year-on-year in January after a 49.5 percent jump in December, data showed.

Sales of clothing, footwear and accessories grew 2.8 percent on the year in January after a 17.9 percent increase in December.

In terms of volume, retail sales decreased 1.2 percent in January, compared with 4.8 percent increase in December, 12.4 percent growth in November, a 2.9 percent rise in October. It is the first decline in volume term since December 2022 when it slipped 0.6 percent.

Impacting the tourism sales, visitor arrivals in Hong Kong were also down in January, to 3.83 million, compared to 3.93 million in December, according to Hong Kong Tourism Board data. However, the number of mainland Chinese visitors increased to 2.98 million in January, as compared to 2.94 million in December

“Continued increase in visitor arrivals alongside further recovery of handling capacity and organization of mega events would bode well for retail businesses,” a government spokesman said, adding government initiatives to boost consumption should also provide support.

Looking ahead, the government is rolling out more than HKD 1 billion in support measures for its sluggish tourism industry. The luxury shopping city will also stage more than 80 event in the first half of the year to lure more visitors, including a monthly fireworks and drone show at its panoramic Victoria Harbour.

Last month, fashion house Dior postponed its upcoming menswear show in Hong Kong, which was slated to take place on March 23; a major blow to the city which is looking to boost its economy through major events.