Shoppers and tourists take photos in front of a 12-meter high "Flower Vase" installation in a shopping mall. Hong Kong's retail sales rose 16 percent in December, showing the strongest growth in 20 months.
HONG KONG: Thanks to the spending power of mainland tourists visiting the city, Hong Kong's retail sales beat market expectations and recorded the strongest growth in 20 months by rising 16 percent in December, according to figures released by the Census and Statistics Department yesterday.
The value of retail sales in December was provisionally estimated at HK$29.4 billion, up 16 percent over a year earlier. That was more than the estimated 11.4 percent according to a survey of economists by Bloomberg. After netting out the effect of price changes over the same period, the volume of total retail sales increased by 11.3 percent.
"With the economic recovery gathering pace, consumer sentiment strengthened during the festive season, as evidenced by the marked increases in the sales of big ticket items," said a government spokesman, who went on to say that "the further growth of inbound tourism also contributed. For 2009 as a whole, retail sales volume recorded only a small decrease over 2008."
He expects that consumer confidence should remain firm going forward, as the economy is on track to recovery and the labor market has been improving.
There was strong growth in the sale of pricey items. The volume of sales of jewelry, watches and clocks, and valuable gifts increased the most, by 30.4 percent. This was followed by sales of motor vehicles and parts (+29.8 percent in volume); electrical goods and photographic equipment +23.0 percent); wearing apparel (+9.6 percent); commodities in department stores (+9.3 percent); miscellaneous consumer goods (+8.4 percent); miscellaneous consumer durable goods (+4.7 percent); furniture and fixtures (+4.0 percent); footwear, allied products and other clothing accessories (+3.6 percent); food, alcoholic drinks and tobacco (+2.1 percent); and fuels (+1.1 percent).
On the other hand, the volume of sales of commodities in supermarkets fell by 3.8 percent in December 2009 when compared with a year earlier.
For 2009 as a whole, total retail sales increased by 0.6 percent in value, but decreased by 0.8 percent in volume when compared with 2008.
The government also announced that the revised value of retail sales in November 2009 was HK$22.9 billion, which was an increase of 11.9 percent in comparison with November 2008, while the volume of total retail sales increased by 10 percent.
