Hong Kong needs retail therapy

The Hong Kong protests may have dwindled, but the economic impact has not.

Retail authorities have warned that a quick solution is needed before Hong Kong suffers a fall in October sales for the first time since 2003.

The protests coincided with a key shopping month that encompasses the Golden Week holiday period.

Mainland Chinese typically travel to Hong Kong during this period, which begins on Oct 1.

They account for two-thirds of all visitors to Hong Kong, reported the BBC.

But China suspended travel permits for tours because of the protests.

The Hong Kong Retail Management Association told Reuters on Monday that sales at chain stores had dropped between 30 and 45 per cent from Oct 1 to 5 in Admiralty and Central, as well as in the nearby shopping district of Causeway.

Sales fell just as sharply in Kowloon's working-class district of Mong Kok, scene of some of the most violent clashes among protesters, the police and pro-Beijing groups.

ANZ bank estimates the protests may have cost the city's retailers more than HK$2 billion (S$329 million).

The protests also wiped close to US$50 billion (S$64 billion) off the value of shares on the Hong Kong stock exchange, reported Reuters.

Many Hong Kong businesses were already struggling before the latest demonstrations, a monthly survey by HSBC and Markit Group showed on Tuesday.

New business fell for the fifth straight month in September, while firms reduced staffing levels for the sixth consecutive month.

JOB SHEDDING RATE

The rate of job shedding was the quickest in four months.

But there was light at the end of the tunnel.

After preparatory discussions with student representatives on Monday night, Undersecretary of Constitutional and Mainland Affairs Lau Kong-wah said both sides had agreed on general principles for the formal talks.

"I think today's meeting was successful and progress has been made," he told reporters.

Though protesters began lifting the blockades after this, hundreds remained camped out on the main road leading into Hong Kong's main government and business districts, the last holdouts after more than a week of rallies that attracted tens of thousands on to the streets at their peak.

With trunk roads blocked, alternative routes into key areas of the city have quickly become clogged.

Traffic jams on Hong Kong Island and across Victoria Harbour in Kowloon stretched back miles in some places.

Passengers trying to get on to underground trains were packed tight as they queued up two levels and spilled out onto the street near the main protest site in the Admiralty district.


This article was first published on Oct 8, 2014.
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