Subsidies, new trade show boost buyer turnout
The number of buyers attending Trade Development Council fairs in April rose about 5.5 per cent to 179,324 from a year ago, although 9 per cent of them came because of a new lighting trade show introduced that month.
Without the lighting fair, the number of buyers fell about 4 per cent year on year to 163,050 from 169,918. The drop in buyers would have been worse had the council not offered to subsidise some of their travel expenses.
The council allocated HK$80 million to help pay for the air fare and hotel accommodation of about 10,000 overseas buyers who would not otherwise have come to its shows this year. The council is trying to court first-time buyers from emerging markets including India, Russia and the Middle East in an effort to partially offset the drop in buyers from developed countries like the US.
A total of 5,274 buyers were sponsored by the council to attend this week's Summer Sourcing Show for Gifts, Houseware and Toys, as well as Fashion Week for Spring/Summer.
'Last year, the Summer Sourcing Show had nearly 20,000 buyers while about 17,000 buyers went to Fashion Week. This year, we expect the growth in buyer numbers to be flat,' the council's assistant executive director, Raymond Yip Chak-yan, said.
Buyer numbers have deteriorated despite the subsidies, reflecting the severe impact of the financial meltdown on consumer sentiment and spending. In January, the Hong Kong Toys and Games Fair, the largest in the region, reported a 3.5 per cent drop, while the number of buyers at Fashion Week for Fall/Winter fell by almost 10 per cent. The Hong Kong International Jewellery Show in March had about 5 per cent fewer buyers.
Although there are growing signs that the crisis is stabilising as smaller factory orders trickle in, the global credit crunch and economic downturn continue to hurt demand, especially for luxury goods like cars and jewellery, as buyers are more price-sensitive.
In the first five months of this year, Hong Kong exports of fashion and houseware goods declined 12.9 per cent and 26.6 per cent, respectively, Mr Yip said.
As Hong Kong relies on established markets like the US and EU for about 60 per cent of its exports, the local economy is highly susceptible to the financial turmoil.
Government data shows total exports dropped 19.5 per cent in value during the five-month period compared to a year ago.