Hong Kong recorded an 18.4 percent year-on-year increase in retail sales in May, marking the sixth consecutive month of growth. The revival of inbound tourism and positive consumption sentiment contributed to the strong performance, and this trend is expected to support future growth. Sales reached HK$34.5 billion ($4.40 billion), compared to a 14.9 percent rise in April and a 40.8 percent growth in March.
The strict COVID-19 restrictions had negatively impacted Hong Kong’s economy since early 2020. However, with the full reopening of border checkpoints and the lifting of the mask mandate from March 1, the city has been able to attract visitors and restore normalcy.
To further boost tourism and local spending, the government launched campaigns such as “Hello Hong Kong” in March and “Happy Hong Kong” in late May. These initiatives aim to attract more tourists, improve retail sales, and stimulate the economy.
A government spokesperson stated that retail sales are expected to continue improving in the coming months, as the number of incoming visitors is projected to increase alongside the expansion of transportation and handling capacity.
In terms of volume, retail sales saw a 16.5 percent year-on-year increase in May. This followed a 13.1 percent growth in April and a 39.3 percent growth in March.
According to the spokesperson, improved labor market conditions, the disbursement of the second installment of consumption vouchers, and promotional efforts by the government and the industry will continue to support local consumption demand.
The Hong Kong Retail Management Association launched the “Happy Hong Kong Shopping Festival” from July 1 to August 31, with around 6,000 participating stores offering discounts and other promotions to encourage consumption.
Despite the challenges posed by the pandemic, Hong Kong’s economy showed resilience, growing 2.7 percent in the first quarter of the year compared to the same period last year. The recovery of tourism and domestic demand are expected to remain key drivers of growth for the rest of the year. The government has maintained its economic growth forecast of between 3.5 percent and 5.5 percent for 2023.
Tourist arrivals in Hong Kong slightly declined to 2.83 million in May from 2.89 million in April. However, the numbers marked a significant increase compared to May 2022, when strict COVID-19 controls were in place. Mainland Chinese visitors accounted for the majority of arrivals, with 2.29 million recorded in May.
In May, sales of jewelry, watches, clocks, and valuable gifts, which were previously popular among mainland tourists, surged by 51.8 percent year-on-year.
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