Hong Kong’s retail sales plunged 23.1 percent in July from a year earlier, falling for the 18th consecutive month as the city implemented its toughest social distancing measures amid the third wave of COVID-19 infections.
Sales dropped to HK$26.5 billion ($ 3.4 billion), according to provisional figures from the Census and Statistics Department on Tuesday. Although the decline was less than the 24.7 percent drop in June, it does not mean conditions have improved, said Annie Tse Yau On-yee, chairperson of the Hong Kong Retail Management Association.
“The comparatively modest fall was due to a lower comparison base last year, as it was the first full month affected by the protests in July 2019,” she said. “If you compare the figures with July 2018, it’s about 32 percent down.”
Although the decline was less than the 24.7 percent drop in June, it does not mean conditions have improved
Annie Tse Yau On-yee
chairperson of the Hong Kong Retail Management Association
Most categories saw declines compared to the same period a year ago, while supermarkets continued to outperform with a 26.5 percent surge in sales.
Tse explained that many consumers have chosen to shop for groceries at supermarkets instead of wet markets for fear of getting infected by the third COVID-19 wave that started in mid-July.
In volume terms, July’s retail sales fell 23.9 percent, compared with a revised 25.3 percent in the previous month.
The total value of total retail sales in the first seven months of this year plummeted 32.1 percent, compared with the same period in 2019.
A government spokesman said the year-on-year decline in retail sales remained notable in July, as the surge in local COVID-19 cases and the subsequent tightening of social distancing measures that month further disrupted consumption sentiment.
Hong Kong saw a new wave of coronavirus infections throughout July, with the number of cases having more than doubled to almost 3,300 by the end of the month. The Hong Kong government enforced more restrictive measures in mid-July, including closures of public facilities, limiting restaurants’ seating capacity and business hours, as well as curbing public gatherings, pummeling the retail industry.
The spokesman noted that while the pandemic may have eased recently, helping to improve consumption sentiment, the retail business environment will continue to be very difficult in the near term, as inbound tourism remains at a standstill.
Tse expects retail sales in August to be similar to July’s. Although more residents are going outdoors, she believes consumers’ shopping eagerness has yet to resume, and it’s difficult to predict the retail sector’s performance for the second half of this year.
To stimulate consumption, Hong Kong Retail Management Association will launch a promotion campaign with the Quality Tourism Services Association, details of which will be released later this month.
