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Cannix Yau

Hong Kong’s retail sales in June declined 9.7 per cent from a year ago, the fourth consecutive monthly contraction amid a trend of residents heading across the border to spend and despite the expansion of a solo traveller scheme to boost inbound tourism.
Provisional figures released by the Census and Statistics Department on Thursday showed retail sales dropped 6.6 per cent in the first half of the year compared with the same period in 2023.
Sales in June shrank to HK$29.9 billion, after an 11.4 per cent year-on-year decline in May and a fall of 14.7 per cent in April.
The figures mark the fourth consecutive contraction following 15 months of continuous growth after the coronavirus pandemic.
A government spokesman said the rate of decline had narrowed further in June amid the changing consumption patterns of visitors and residents and the strong Hong Kong dollar, reflecting signs that retail activities were stabilising.
The spokesman said the sector would still face challenges in the near term.
“Nonetheless, the central government’s various measures benefiting Hong Kong, as well as the [Hong Kong] government’s strenuous efforts to promote a mega-event economy and support the development of the local retail sector, should benefit the sector,” he said.
“In addition, continued growth of the economy and rising employment earnings should also provide support to the retail sector.”
The spokesman added that the government would continue to support the local retail sector, such as providing help for small and medium-sized enterprises in upgrading and transformation, and market development.
He said the Trade Development Council’s Hong Kong Shopping Festival on mainland Chinese e-commerce platforms in August would drive publicity about Hong Kong brands and products across the border. It would also help local enterprises expand into mainland e-commerce business, the spokesman added.

Other events included a number of large-scale public exhibitions organised by the TDC during the summer holidays, including the Hong Kong Book Fair in July and the Food Expo later this month.
“These events are expected to help attract visitors and local consumers to shop, thereby boosting the retail sector,” he said.
The Hong Kong Tourism Board said it had successfully bid for more than 60 large-scale international Meetings, Incentives, Conferences and Exhibitions (MICE) events with diverse themes for the city between this year and 2026.
“These events are expected to attract at least 220,000 participants, including at least 180,000 mainland and overseas visitors, testifying to Hong Kong’s status as the ‘World’s Meeting Place’,” it said.
They cover a wide range of themes and industries, including first-time events in aviation, architecture, stem cell research and education for the city.
Beijing expanded the solo traveller scheme to include eight more mainland cities in late May. Chief Executive John Lee Ka-chiu earlier estimated that the expansion of the scheme to cover 59 mainland cities would attract an extra 300,000 visitors to Hong Kong and generate up to HK$1.5 billion in additional revenue each year.
Residents of the cities involved can travel to Hong Kong on an individual basis rather than having to join a tour group.
The retail sales statistics followed the government’s latest gross domestic product figures, which showed the economy expanded by 3.3 per cent in the second quarter year on year, buoyed by strong exports and slightly exceeding growth in the first three months of 2024.
Online sales in June rose by 5.2 per cent year on year, with transactions of HK$2.3 billion accounting for 7.8 per cent of the total retail figure.
By category, the value of sales of motor vehicles and parts dropped 25.1 per cent, with jewellery, watches and clocks, valuable gifts falling 23.1 per cent and commodities in department stores down by 18.6 per cent.
Retail Management Association chairwoman Annie Tse Yau On-yee said the sector was facing a very difficult time in the short term as the trend of people spending across the border and the changing consumption habits of tourists would continue.
“We expect retail sales to continue to drop to the end of this year as we don’t see any incentives to change the trend of Hong Kong people going north and tourists tightening their purse strings,” she said.
“With the central authorities raising the duty-free limits for mainland tourists from August 1 and interest rate cuts rolled out by the United States, there may be a chance to turn around the situation to become better after October.”
Tse also called on landlords to provide rental relief for retailers as they were facing rising operating costs including rent and labour.
Central authorities raised the duty-free threshold from 5,000 yuan (US$692) per trip to 12,000 yuan for mainland residents aged 18 and above, to encourage more visitors to spend in Hong Kong. The measure, first introduced in July at six land ports, was on Thursday expanded to travellers going through all border points.
They can enjoy a higher limit of 15,000 yuan, or HK$16,100, if they shop at duty-free stores at border crossings.


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Hong Kong retail sales fall 9.7% in June, marking fourth straight decline despite expanded travel scheme

Sales in June shrank to HK$29.9 billion, after an 11.4 per cent year-on-year decline in May. Photo: Jelly Tse

The retail sector is showing signs of stabilisation, a government spokesman says. Photo: Jelly Tse

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People outside a closed store in Mong Kok. Photo: Yik Yeung-man

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Retail industry inertia is a factor behind the downturn, according to a lawmaker. Photo: Jelly Tse

The strong Hong Kong dollar is making shopping in the city more expensive. Photo: Jelly Tse

Hong Kong retail sales drop 11.5% in May, marking second straight monthly double-digit fall

The retail sector may still face some challenges in the near term, the government says. Photo: Jelly Tse

Hong Kong has launched a summer shopping festival to encourage consumption. Photo: Jelly Tse

News

Hong Kong

Provisional data also shows sales contracted 6.6 per cent in first half of year


Census and Statistics Department provisional data shows sales contracted 6.6 per cent in first half of year.
