Retailers aren’t just struggling in Macao: Hong Kong’s retail sector saw sales falling for the twelfth month straight in February. Provisional official figures showed HK$29.4 billion (US$3.8 billion) worth of sales for the month, down 13 percent year-on-year, the South China Morning Post reported.
January, meanwhile, saw a year-on-year decline of 3.1 percent. A government spokesman said that Lunar New Year’s earlier arrival this year had exacerbated February’s poor performance when compared with the same month in 2024.
However, Gary Ng Cheuk-yan, a senior economist at Natixis Corporate and Investment Bank, told the Post that further contractions were likely across 2025. “The structural change in the consumption pattern of mainland Chinese tourists, the fading confidence of the local middle class and the persisting trend of outbound tourism will continue to limit the recovery,” he said.
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March’s figures should show an improvement thanks to mega-events like the Hong Kong Sevens and Art Basel, according to one analyst spoken to by the Post.
Nonetheless, Hong Kong’s retail scene suffers from many of the same long term issues plaguing Macao’s. Rents and costs are high. At the same time, locals are heading north to shop in mainland Chinese cities like Shenzhen, where prices can be less than half of what is charged in Hong Kong. Shenzhen can also be reached in as little as 15 minutes from downtown Hong Kong by high-speed rail.
Meanwhile, mainland Chinese tourists – Hong Kong’s biggest market – are spending less. Thanks to improved transport links, many are also visiting just for the day, instead of spending money on hotels.
