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Hong Kong retail sales fall for third month as mainland visitors slow
[HONG KONG] Hong Kong retail sales fell 0.1 per cent in May in value terms from a year earlier, as slower tourist arrivals hurt sales of big-ticket items such as jewellery and watches.
The city's retail sector has been hammered by slowing mainland tourist arrivals, tighter visa rules on residents from neighbouring Shenzhen and lower mainland import taxes on some goods.
Retail sales fell to HK$39 billion (S$6.79 billion) last month, following a revised 2.1 per cent drop in April and a 2.9 per cent decline in March. Sales rose 4.6 per cent in May by volume.
For the first five months, the value of retail sales fell 1.8 per cent from a year earlier, while the volume of retail sales was up 1.3 per cent. "The near-term outlook for retail sales will still depend much on the performance of inbound tourism," the government said in a statement.
The number of mainland visitors to Hong Kong rose 1 per cent on year in April, against a 14.7 per cent increase a year earlier and a 10 per cent drop in March this year, data from Hong Kong Tourism Board shows.
Street tensions, where some groups had staged small but disruptive protests targeting mainland Chinese visitors, appear to have eased after Hong Kong's legislature vetoed a Beijing-backed electoral reform package earlier in June.
Sales of jewellery, watches and clocks fell 14.9 per cent by value compared with a 19.5 per cent drop in April and a 18.6 per cent decline in March. Medicines and cosmetics fell 1.9 per cent, against a 3 per cent decline in April and a 3.3 per cent drop in March.
Earlier this month, the world's biggest jewellery retailer Chow Tai Fook Jewellery saw its profit dropped 25 per cent in the year ended in March 2015. It said it planned to close two stores in prime shopping districts in Hong Kong later this year.
Last week, cosmetics chain Sa Sa International posted a 10.3 per cent fall in its full-year net profit ended in March, and said it expected to see slower growth in mainland tourist arrivals while local retail sentiment remained weak.