Retailers and restaurants in Hong Kong continued their struggle for customers over the 1 July long weekend – held to commemorate the anniversary of the city’s 1997 handover. Multiple media outlets reported a mass exodus of local residents to mainland China, where prices are far lower and variety much greater.
An estimated 1.26 million Hong Kongers made their way north during the holiday period, with the highest number of departures occurring on the first day of the holiday, which saw a total of around 550,000 leaving the SAR.
There was an almost 130 percent rise in total departures compared to the 1 July holiday last year. Meanwhile, just 268,000 visitors arrived from mainland China – Hong Kong’s largest tourism market – meaning that the city experienced a huge net outflow of people.
It’s more bad news for retailers, who suffered a 11.5 percent year-on-year decline in sales in May, according to government data. The HK$30.51 billion total marks the third consecutive month that the sales have dropped, with March and April registering year-on-year falls of 7 percent and 14.7 percent respectively.
[See more: Macao’s independent restaurateurs are facing a catastrophic loss of business]
“The retail sector may still face some challenges in the near term,” the Hong Kong government acknowledged in a statement.
It noted that the decline has largely come about as a result of “changes in the consumption patterns of visitors and residents as well as the strength of the Hong Kong dollar” against the yuan, making shopping on the mainland even cheaper for Hong Kong residents.
Businesses in Macao have also been experiencing many of the same issues that their Hong Kong counterparts are facing, with many Macao residents redirecting their spending to neighbouring Zhuhai. A recent survey found that local consumers were more satisfied with Zhuhai’s restaurants than those in Macao.
Earlier this year, Chief Executive Ho Iat Seng encouraged Macao residents to “leave room for one meal in Macao.”
