In Hong Kong, revenue from luxury items including jewelry, watches, clocks, and valuable gifts has witnessed an 18% decrease year-on-year, amounting to HKD 4.18 billion ($534.2 million). This decline marks a departure from the growth trajectory seen in the jewelry segment, with the downturn largely attributed to the normalization of tourism levels compared to the surge experienced last year upon the border reopening.
A significant driver of luxury revenue in Hong Kong is tourism, particularly from mainland China, where visitors have historically fueled demand for high-end goods. However, recent trends indicate a shift among Chinese buyers towards plain gold jewelry, impacting sales of diamond jewelry.
In the broader luxury market, sales of hard luxury items experienced a modest decline of 0.5% year-on-year for the first quarter of 2024, amounting to HKD 14.43 billion ($1.85 billion). Overall retail sales also dipped by 1.3% to HKD 101.47 billion ($12.98 billion) for the same period.
While factors such as high base comparisons for visitor spending and the timing of the Easter holidays contributed to the decline observed in March, government representatives express optimism regarding the sector’s future outlook. Anticipated revivals in inbound tourism and the expected increase in household income are anticipated to bolster the retail sector. Furthermore, governmental initiatives aimed at promoting events and enhancing consumer sentiment are viewed as positive steps. However, challenges may persist due to evolving consumption patterns among both visitors and residents.
