- Kristopher Fraser |
Reuters has reported that one in retailers, about 7000 of Hong Kong's 64,000 licensed retail establishments, could be forced to close down in the next six months. Violent protests have been deterring tourists from visiting Hong Kong costing retailers sales.
Hong Kong is typically one of the top shopping destinations for Chinese tourists, but the retail sector has a bleak outlook thanks to ongoing anti-Beijing protests. Retail sales have fallen by 25 percent, the biggest drop on record, and tourist traffic has declined by 43.7 percent.
The Chinese government has pledged 3.2 billion dollars to help support retailers, but it's not clear if that will be enough to help retailers survive the decline in consumers. The Hong Kong Retail Management Association (HKRMA) took a survey which found that 97 percent of retailers have seen declines in traffic due to the protests. 30 percent of respondents said they will have to layoff staff within the next six months, resulting in 5600 unemployed people.
"The wave of layoffs and store shutdowns could be the worst in recorded history," said Annie Yau Tse, chair of HKRMA, to Nikkei Asian Review. The protests have sent Hong Kong's economy into a technical recession. In August, the HKRMA suggested landlords cut rent by half for six months to balance out the decline in retail sales and make it more affordable for retailers to continue operating.