Compare the Impact of SARS and COVID-19 on Retail Sales Amount

On March 31, the Census and Statistics Department will announce the total retail value in February. This will be the first important data on the impact of COVID-19 on the Hong Kong economy. At present, there is no data on the impact of the epidemic on the local economy, even though the plummets in the number of tourists and air traffic passengers have been known, so the retail data will reveal important information for further predictions.

My previous article (Yiu, 2020) has analyzed the data on the number of tourists and air traffic passengers of SARS and COVID-19. The magnitudes of their declines are unprecedented, and the record may not be breakable, as it has already been near the lower cap.

However, the COVID-19 developed from an epidemic in China to a pandemic in March, Hong Kong seems to be infected by the second wave. The impacts on the retail markets in March should be even more severe than that in February.

Generally speaking, even without tourists and foreign consumers, local citizens still go out to spend, so the decline in total retail sales amount is generally lower than the decline in the number of tourists. However, the impact of this epidemic has made the situation a little different, because not only are tourists extinct, but even local consumers try to stay at their homes as much as possible. Only the consumption of basic necessities remains! The situation is also much more severe than that of SARS, and it lasts much longer. Is the decline deeper than that of SARS?

The four most serious declines in Hong Kong’s retail value over the past 22 years were -21% in 1999, -15% in 2003, -21% in 2016, and -24% in 2019. The changes in the number of tourists during the same period were + 11%, -68%, -21%, and -44%. The decline in the total retail sales amount each time was smaller than that of the number of tourists. In fact, before 2004, Hong Kong ’s retail industry was less dependent on tourism, and the data also reflects this change in dependence. However, after SARS, the retail industry has become highly dependent on tourist business. In the past 8 months (July 2019 Until February 2020) there has been a rare continuous decline in the number of tourists, and the recent decline has been aggravated from -55% to -96%; the total retail sales amount is the direct market impacted by the decline. The annual change of total retail sales amount has shown negative growth since February last year, and the period of 12 continuous monthly negative figures is the longest period of market decline.

Figure 1 shows that the impact of SARS on the retail industry is relatively small. The continuous negative growth period is only 6 months, but COVID-19 has not yet arrived. The retail industry in Hong Kong has been negatively growing for 12 consecutive months. Based on my quantitative model, the total retail value in February is estimated to be a very substantial plummet of -53%, which is bound to break the record! Let’s see whether it is accurate when the figure is announced at the end of this month.

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Figure 1 Retail Sales Amount — YoY of Hong Kong. The orange line is from January 2000 to December 2003; the blue line is from January 2017 to January 2020. Source: Hong Kong Census and Statistics Department

[A Chinese Version is available at]


Yiu, C.Y. (2020) Comparing the impact of SARS and COVID-19 on the number of tourists arriving in Hong Kong, Medium, March 19.

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