Interpac Business and Migration Solutions Melbourne Australia

December 30, 2009

HONG KONG: With more mainland tourists happy to spend in the city, Hong Kong's retail sector saw a strong performance last month.

Newly released government figures showed Hong Kong's retail sales in November rose by the most in 18 months, boosting the city's recovery, as falling unemployment and buoyant stock and property prices also encouraged consumer spending.

Sales grew 11.7 percent in November from a year earlier to HK$22.9 billion ($3 billion), after rising 9.8 percent in October. The median estimate of seven economists surveyed by Bloomberg News was for an 8 percent gain.

A government spokesman says that the strong November sales reflected the strengthening of consumer sentiment, as evidenced by the sharp increases in spending on such big-ticket items as motor vehicles and consumer durable goods. The continued expansion of inbound tourism also contributed.

"On a seasonally adjusted basis, the levels of retail sales in recent months have already surpassed those before the outbreak of the financial tsunami. With the economy improving, consumer confidence should continue to hold firm going forward, rendering support to the retail business," he said.

"Booming asset markets have lifted consumer confidence," said Joanne Yim, Chief Economist at Hang Seng Bank, adding, "Improving labor market conditions also lend support to spending."

Hong Kong's retail sales returned to growth in September after falling for seven months.

In November, the volume of sales of motor vehicles and parts jumped 52 percent from a year earlier, while electrical goods and photographic equipment climbed 19 percent, the government said.

As for tourism, visitor arrivals rose 7.6 percent to 2.6 million in November from a year earlier, with a 13.3 percent gain in the number of people coming from the mainland, according to the Hong Kong Tourism Board.

By volume, retail sales rose 9.8 percent in November from a year earlier after growing a revised 8.3 percent in October, the government said.

(Source from Chinadaily HK Edition)