Hong Kong protests impact local retail sector

Many economists are predicting a major contraction in Hong Kong's retail sales value and volume with some estimates at close to a 15% decline.

Our reporter Eugene Benson looks at Hong Kong's retail sector in this time of great economic uncertainty.

Hong Kong is world famous for its shopping - everything from luxury brands to bargain hunting.

But three months of anti-government protests have crippled the city's crucial retail sector, with a local business group saying sales were down by 50% in August. This comes after sales in July recorded the weakest reading in three and a half years.

Lanterns displayed at a market in Hong Kong ahead of the Mid-Autumn Festival on September 5, 2019. [Photo: IC]

Retail business has been hit particularly hard - as mass rallies and clashes between police and protesters have turned some of Hong Kong's main shopping areas into battlegrounds.

Most economists predict a major contraction in Hong Kong's retail sales value and volume -- with some estimates at close to a 15% decline. Many people are asking: what does the city need to do to get its retail sector back on track.

Jane Freeman runs a pop-up homeware stores in Kowloon and Central, she said it was noticeably more quiet on usually busy streets.

"It has been getting a little more quiet with sales trending down for the past 18 months, but I would say certainly the most quiet has been in August, and September this year and that must be because of the protests and less people coming out.

Freeman said she now had to rely more on online selling.

“I am very lucky because I get many of my sales actually a growing amount of my sales not in person but through my social media accounts. I think that is where lots of smaller sellers will now focus on social media. In general, retail is continuing to move online.”

Freeman added even big brand shops were quiet.

"I went shopping with friends on Sneaker Street in Mong Kok last weekend and even that was quiet, it made shopping easier but I'm sure it is not good for sales.

As it stands, even some of the world's most glamourous brands are feeling the heat.

In August, the landlord for Prada's giant retail store in Causeway Bay said the Italian luxury company would shut its doors in June.

And Tiffany & Company, the New York jewellery seller, said the protests were "taking a toll" on its business in Hong Kong, with its sales plummeting since the protests began.