China tax crackdown pushes wealthy to gold as safe haven, lifting Hong Kong jewellery sales
Chinese consumers now prioritise wealth preservation over growth, with high returns no longer a priority
The booming jewellery and watch sales in Hong Kong, reaching their highest level since 2019, can be attributed to wealthy Chinese consumers prioritising wealth preservation over growth amidst China's stricter tax policies and capital outflow restrictions. The sector, accounting for about 15% of Hong Kong's total retail sales, saw a 22% year-on-year increase in sales of jewellery, watches, clocks and valuable gifts to HK$45.8 billion (US$5.8 billion) in the first nine months of the year.
Despite a 10% plunge in luxury spending in mainland China, Hong Kong jewellery sales maintained double-digit growth even as global giants like Hermès International and Richemont reported weaker sales. The strong yuan, tax-free status of Hong Kong, and a strong tourism recovery have made the city an attractive destination for Chinese shoppers.
Meanwhile, the soaring gold prices and the perceived reliability of gold as a store of value have made it a preferred safe haven for wealth preservation.
Written by urgent.news from The Business Times - Companies & Markets's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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