Hong Kong Recovery Boosts Jewelry Sales

RAPAPORT... Sales of jewelry, watches and other luxury items in HongKong rose in the first 11 months of 2017 as tourists returned and localconsumer sentiment recovered, the city's official data authority said.Retail sales for the category grew 5% year on year to $8.49billion (HKD 66.35 billion) for the January-to-November period, Hong Kong'sCensus and Statistics Department said in a statement Wednesday. Novemberproceeds jumped 8% to $783.1 million (HKD 6.12 billion), it added. Sales across all retail products rose 1.8% for the first 11months, and climbed 7.5% in November, reflecting the "visible growth in visitorarrivals and the [optimistic] consumer sentiment during the period," a spokespersonfor the Hong Kong government said. Hong Kong's luxury retail sector is largely reliant onpurchases by tourists from mainland China. A slump in visitors from thatlocation hit Hong Kong's retail industry over the last two to three years, withsales of jewelry and other luxury items sliding 17% in 2016. However, thetourist sector recovered this year: Visitors from mainland China rose 3.6% fromJanuary to November, to a total of 40.2 million, according to the Hong Kong Tourism Board. Meanwhile, the total number of tourists arriving in Hong Kongfrom all locations jumped 7% to 5 million in November compared with the samemonth last year. During the first 11 months of 2017, the figure climbed 3.1%to 52.9 million. As a result, Hong Kong jewelry retailers saw significant improvementsin their 2017 performances. Chow Tai Fook's same-store sales jumped 9.5% in HongKong and Macau in the six months ending September 30, while Luk Fook recorded13% growth in retail sales for the same region. "The near-term outlook for retail sales remains positive, asconsumer sentiment is buttressed by the favorable employment and incomesituation, and as inbound tourism continues to recover," the governmentspokesperson noted. The upturn in 2017 also affected the diamond trade, withimports of polished stones into Hong Kong growing 7% to $14.07 billion in thefirst nine months.Image: Andrey Bayda/Shutterstock