Hong Kong Retail Slide Continued in August Amid Restrictions
Hong Kong Retail Slide Continued in August Amid Restrictions
(Bloomberg) -- Hong Kong retailers’ struggles eased slightly in August even as social-distancing measures were extended to combat the latest wave of coronavirus infections in the city.
Retail sales by value fell 13.1% from a year earlier to HK$25.6 billion ($3.3 billion), according to a government statement. That’s better than the median forecast for a 17.5% decline in the period, according to economists surveyed by Bloomberg. Retail sales by volume also dropped 13.4% from year-ago levels, an improvement on the 23.8% decline in July, the report said.
The continued weakness comes after a 23.1% decline in July, as well as four straight months of a contraction of more than 30% from February through May during the initial stages of the pandemic. Hong Kong’s retailers have borne the brunt of the city’s deepening economic recession this year amid the pandemic, rising U.S.-China political tensions and recurring protests.
The narrowing year-on-year decline was mainly the result of a low base of comparison, a government spokesman said.
“As economic conditions remain under pressure and inbound tourism is unlikely to show any swift recovery in the near term, the business environment of the retail trade will remain difficult,” the spokesman said. “Local consumption sentiment may further improve if the recent stabilization of the local epidemic situation sustains.”
There is some cause for optimism that things may improve more in coming months. The latest wave of infections eased in August and shows further signs of subsiding, while the government has lifted some restrictions, extending hours of restaurants and allowing bars to open.
Chief Executive Carrie Lam announced a HK$24 billion round of relief stimulus earlier this month, which has been criticized by some economists and business leaders for its relatively small size.
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