Visitors enjoy the view of Victoria Habour at the Avenue of Stars in Tsim Sha Tsui, Hong Kong on Jan 2, 2023. (PHOTO / CHINADAILYHK.COM)
Strolling around the shopping mecca of Hong Kong’s Tsim Sha Tsui District testifies to the gradual recovery of the retail and tourism business in the special administrative region.
At Ocean Terminal, where Silversea Cruises’ Silver Spirit is docked, visitors can be seen busily taking shots of the cruise liner against the backdrop of the city’s famous Victoria Harbour. The Silver Spirit is the first international cruise vessel to call at Hong Kong in three years since the outbreak of the COVID-19 outbreak.
The Lis and their two children – a family of four from Shunde, Guangdong province – were among the tourists attracted by the presence of the Silver Spirit. The family arrived in the city on Jan 17, taking advantage of the recent resumption of quarantine-free travel between Hong Kong and the Chinese mainland.
“It is much easier to come to Hong Kong now. We plan to stay here for a couple of days for sightseeing and visiting relatives,” said Mrs Li.
Adrian, an Italian tourist, said he had planned his trip to Hong Kong one month earlier before arriving in the city on Jan 18. He intends to stay for one week, visiting famous tourist landmarks, such as the Peak and the Big Buddha on Lantau Island.
“I love Hong Kong so much. That is why I picked the city, rather than other Asian cities, for my vacation after Hong Kong scrapped its COVID restrictions for inbound travelers last year,” he said.
Familiar scenes of tourists hauling their luggage through jammed Tsim Sha Tsui streets have re-emerged after all but disappeared since COVID-19 erupted in early 2020. Luxury jewelry shops and stores selling pharmaceutical drugs and health products have drawn the biggest crowds of shoppers.
The retail market is sanguine this year in 2023. High-street shop performance will pick up steadily, while neighbourhood malls will continue to be supported by a strong local consumption market. We should keep a close eye on the drive and spending pattern of inbound tourists, especially in the following months.
Cynthia Ng, head of retail services at Colliers Hong Kong
“Visitors are gradually returning following the resumption of normal travel between Hong Kong and the mainland although the number is still not very high at this stage,” said a drugstore owner in Tsim Sha Tsui. “Our business has since gone up by 20 to 30 percent. We expect the visitor flow and sales to improve after the Lunar New Year holidays.”
The SAR’s economy and businesses are progressively returning to normal after being severely disrupted by the pandemic. The daily quota for each way travel between Hong Kong and the mainland via three land checkpoints has been raised to 65,000 for the four days preceding the Lunar New Year, which falls on Jan 22 this year.
“The retail market is sanguine this year in 2023. High-street shop performance will pick up steadily, while neighbourhood malls will continue to be supported by a strong local consumption market. We should keep a close eye on the drive and spending pattern of inbound tourists, especially in the following months,” said Cynthia Ng, head of retail services at Colliers Hong Kong.
ALSO READ: Boundary reopening brings light to Hong Kong property market
“Market sentiment is set to strengthen this year with the gradual return of mainland tourists. This will support leasing demand and rental growth for shops, especially tourist-oriented retailers,” said Lawrence Wan, senior director and retail head of advisory and transaction services at CBRE Hong Kong.
“We expect high-street shop rents to grow by 5 to 10 percent this year, while rentals for prime shopping malls may stay flat or rise by up to 5 percent,” he said.
“Generally, domestic demand remains weak amid the challenging macro setting and tight financial conditions. But, we see retail sales picking up with Hong Kong’s relaxation of social distancing measures and border reopening,” said OCBC Bank economist Tommy Xie.
He expects the daily travel quota to be set at about 50 percent of the pre-pandemic arrivals level, and the number of overseas visitors would surge in the coming weeks.
READ MORE: HK moots promotion exercise in Feb to lure visitors, businesses
The value of total retail sales in November last year dropped 4.2 percent from a year ago, according to the Census and Statistics Department’s data released on Wednesday.
The Hong Kong SAR government has injected over HK$60 billion ($7.69 billion) into the local consumption market through the Consumption Voucher Scheme under the 2022-23 Budget.
The value of total retail sales still increased 2.7 percent and 1.4 percent year-on-year in the second and third quarter of 2022 respectively, C&SD statistics revealed.