Hong Kong retail sales extended their freefall in November as months of pro-democracy protests scared off tourists, which affected spending and threatened the survival of small businesses.
Sales fell 23.6 percent from a year earlier to HK$30 billion (US$3.85 billion), Hong Kong government data showed yesterday.
It was the 10th consecutive month of declines and compared with a revised 24.4 percent drop in October, which was the steepest on record.
As protests spread across shopping districts in the territory, many retail operators, from prime shopping malls to family-run businesses, have been forced to close early or for entire days over the past few months.
In volume terms, retail sales fell 25.4 percent, compared with a revised 26.4 percent drop in October.
“The near-term outlook for the retail trade continues to hinge on how the local social incidents will evolve,” a government spokesman said. “As such, ending violence and restoring social order are essential to the recovery of the retail trade and indeed that of the whole economy.”
Hong Kong sank into recession for the first time in a decade in the third quarter last year as the protests plunged the city into its worst crisis since it reverted from British to Chinese rule in 1997.
Hong Kong Financial Secretary Paul Chan (陳茂波) on Sunday said that a contraction in the fourth quarter last year was “unavoidable” and that the budget next month would focus on boosting the economy.
Tourist arrivals in Hong Kong plunged 55.9 percent year-on-year in November last year, the steepest fall since May 2003, when the territory was hit by a SARS outbreak.
November tourist arrivals fell to 2.65 million, according to the Hong Kong Tourism Board.
That compared with a 43.7 percent plunge in October.
The number of mainland Chinese visitors fell 58.4 percent in November to 1.93 million, accounting for 72.8 percent of arrivals.
High-end retailers, who rely heavily on mainland Chinese spending, have been particularly hard hit.
Sales of jewelry, watches, clocks and valuable gifts plunged 43.5 percent year-on-year in November compared with a revised 43 percent drop in October, data showed.
Medicines and cosmetics fell 33.4 percent, while department store sales dropped 32.9 percent, data showed.
The Hong Kong Retail Management Association estimates that about 7,000 businesses, or more than one in 10 retailers, will be forced to close in the next six months.
The association has called for more government relief measures and urged landlords to cut rent.
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