Hong Kong retail sales plummet as coronavirus continues to dent economy
Hong Kong’s retail sales fell 21.4 per cent in January on a year-on-year basis, as fears over the spread of the coronavirus kept tourists away from the city’s shopping centres.
Sales dropped to $4.9bn according to government data, the 12th consecutive month of decline.
The coronavirus outbreak has compounded an already challenging environment for the special administrative region, which has been afflicted by months of violent protests against the Chinese government.
Data released over the weekend showed that Chinese factory activity contracted at its fastest ever pace in February as the outbreak savaged industrial activity around the country.
The official Purchasing Managers’ Index (PMI) for February fell to 35.7, down from 50.0 in January. Any score below 50 represents contraction.
The new orders index fell even further, from 51.4 to 29.3, also a record low, due to widespread shutdowns and quarantines.
Sign up to CityAM’s Midday Update newsletter, delivered to your inbox every lunchtime
However, shares rose on the back of the data amid hopes that the weak performance would encourage Beijing to roll out more measures to bolster the economy.
The outbreak has cost Middle Eastern airlines approximately $100m so far as spooked passengers and suspended services have led to a drop in demand in the region.
Ali Albakri, the International Air Transport Association’s (IATA) vice president for Africa and the Middle East, said that governments should give carriers assistance through “this difficult period”.
Ticket sales are anticipated to fall further in the coming weeks, while revenues will soon be under threat if travel restrictions remain in place.
Earlier this month IATA warned that the outbreak could cost the global airline industry nearly €30bn across the whole year, the vast majority of which will be felt in the Asia-Pacific region.