As of November 1, 2024, Hong Kong's economy is facing significant challenges, particularly in the retail sector. Retail sales fell by 6.9% year-on-year in September 2024, totaling HK$29.6 billion. This decline marks the seventh consecutive month of decreasing sales, following a 10% drop in August. Over the first nine months of 2024, retail sales contracted by 7.6% compared to the previous year [dd6dd9be].
The downturn in retail sales has been attributed to changing consumer behaviors, with many Hongkongers opting to shop in mainland China. This shift in shopping habits has compounded the challenges faced by local retailers, leading to a significant number of business closures. In 2022, 88,232 firms closed, followed by 94,002 in 2023, and 64,594 in the first seven months of 2024 [dd6dd9be].
In response to these economic pressures, the Hong Kong government is implementing measures aimed at boosting consumer sentiment and supporting spending. Financial Secretary Paul Chan Mo-po has acknowledged the mixed signals in the economy, noting that private consumption expenditure has declined by 1.4% year-on-year [2f6fdb57].
Despite these challenges, the export sector has shown resilience, with exports increasing by 10.7% and imports rising by 7.1% during the same period. Additionally, tourism has rebounded significantly, with Hong Kong welcoming 32 million visitors in the first nine months of 2024, a 39.7% increase from the previous year [2f6fdb57].
As the government prepares to revise its full-year economic forecast, the focus will be on how to navigate the ongoing retail decline while fostering growth in other sectors [dd6dd9be].