Hong Kong’s retail sales dropped 11.5 per cent in May from a year ago, marking the second consecutive month with a double-digit decrease, under the continuous influence of rising cross-border spending.
Provisional figures released by the Census and Statistics Department on Tuesday showed sales in May shrank to HK$30.5 billion, after a 14.7 per cent year-on-year decline in April.
A government spokesman attributed the poor performance to changes in the consumption patterns of visitors and residents, as well as the strength of the Hong Kong dollar.
“Looking ahead … the retail sector may still face some challenges in the near term,” the spokesman said.
He said a relatively high base for comparison in the same period last year was also relevant.
“However, the central government’s recently announced measures benefiting Hong Kong, including the further enhanced individual visit scheme and the increase of duty-free allowance for luggage articles for mainland resident visitors, should help stimulate retail businesses,” the spokesman said.
In the first five months of 2024, retail sales contracted 6.1 per cent from the same period last year.
The central government raised the duty-free threshold from 5,000 yuan (US$688) per trip to 12,000 yuan for mainland residents aged 18 or older. The limit can be further increased to 15,000 yuan, or HK$16,100, if they shop at duty-free stores at border crossings.
The just-finished long weekend was the third public holiday after Easter and the Labour Day “golden week” where the number of outbound travellers exceeded 1 million.
Immigration data showed 1.26 million Hongkongers departed the city between June 29 and July 1, up from 548,887 over the two-day holiday in 2023.
Meanwhile, 345,178 individuals arrived in the city, including 268,069 mainland residents.
Last year, 233,427 people entered, including 192,431 from the mainland.
Additional reporting by Ezra Cheung
