* Dec retail sales fall 2.9 pct y/y in value, down for 22
* Dec jewellery sales rise 2.3 pct, ending 27 months of
* Retail sales value falls for 3rd consecutive year
* Tourist arrivals rise 5.4 pct in December, up 4.8 pct in
By Donny Kwok
HONG KONG, Feb 3 Hong Kong's retail sales shrank
for the third year in a row in 2016 and by the most in nearly
two decades, hurt by the city's economic downturn and fewer
tourists from mainland China.
The prolonged slump in the once-flourishing retail industry
may be bottoming out, but analysts say it is too early to call
for a recovery yet as store closures and lay-offs continue.
"Looking ahead, the near-term outlook for retail sales
business will still depend on whether the recent improvement in
inbound tourism could gain more traction and the extent to which
local consumer sentiment would be affected by various external
uncertainties," the government said in a statement.
Overall retail sales slid 8.1 percent to HK$436.6 billion
($56.3 billion) in value terms, its biggest percentage drop
since 1998 when sales fell 16.7 percent during the Asian
financial crisis. Retail sales volume was down 7.1 percent last
year, government data showed on Friday.
In December, retail sales value slid for the 22nd straight
month, down 2.9 percent from a year earlier to HK$42.4 billion.
That compared with a revised 5.4 percent fall in November.
A narrower decline in December reflected a revival in
visitor arrivals, the government said.
In volume terms, December sales fell 2.8 percent from a year
Hong Kong, once a favourite shopping destination for
mainland Chinese, has been facing greater competition from Japan
and South Korea. Hong Kong's simmering political tensions with
China and a strong local dollar - pegged to the U.S. currency -
have added to retailers' frustrations.
The city's retailers have scaled back expansion and are
moving out of expensive shopping districts to cope with hard
"We can't say the adjustment has come to an end, nor has it
come to a stage where we are about to rebound," said Kent Wong,
managing director of Chow Tai Fook Jewellery. The
jeweller aims to close 5 to 6 stores in the city in 2017.
Sales of jewellery, watches, clocks and valuable gifts rose
2.3 percent in value terms, ending 27 consecutive months of
decline. Department store sales value fell 3.2 percent in
Total visitor arrivals fell 4.5 percent to 56.65 million in
2016, of which mainland visitors dropped 6.7 percent to 42.78
In December, the arrivals number rose 5.4 percent, an
improvement against a 2.1 percent fall in November and 2.4
percent decline in October. Mainland China visitors rose 6.1
percent in the month. (bit.ly/2kiGRvZ)
The government said on Thursday the total number of visitors
rose 4.8 percent in January, while mainland visitors climbed 7.5
"So we are seeing an increase in tourist arrivals starting
from the last quarter of last year and it carried on through
December to January," said Gregory So, Secretary for Commerce
and Economic Development, but added it was premature to predict
($1 = 7.7589 Hong Kong dollars)
(Additional reporting by Twinnie Siu; Editing by Jacqueline