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From Consumption Vouchers to Digital Economy
Hong Kong's retail sales performance has shown some improvement, with the value of retail sales bounced back in April and rose by 11.7% year-on-year, ending two months of decline. The total value of retail sales for the month also climbed back over the $30 billion mark, amongst which the sales of electrical goods and other consumer durable goods surged by over 40%.
Although the retail market was weak in the first quarter amid the fifth wave of epidemic, which led to an approximately 3% decline in total retail sales value in the first four months of the year as a whole, online sales continued to perform well. The value of online sales rose by 36% in the same period to over $11 billion and accounted for around 10% of total retail sales, higher than about 7% recorded in the same period last year.
Taking a closer look at the online sales figures, the value of online sales from retailers with brick-and-mortar stores totalled over $6.7 billion in the first four months of this year, an increase of 48%; while virtual shops' total sales were $4.3 billion in the same period, an increase of 20%. This shows that even though the overall retail market was plagued by the epidemic, online sales were still able to sustain growth, and their share of the total has been rising. In particular, retailers with brick-and-mortar stores have benefitted the most, indicating that the proportion of online sales and digital transactions is steadily increasing among these traditional retailers.
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| We are going to announce the details of the Phase II of the Consumption Voucher Scheme soon. Earlier I took part in the filming for the API of the Scheme, so as to appeal people to spend more and boost the economy. |
In fact, if we look at the statistics for the past two years, it is evident that the acceptance and adoption of electronic payments and electronic transactions by both the public and merchants have increased after the launch of electronic consumption vouchers. Since the introduction of the Consumption Voucher Scheme last year, major stored value facility (SVF) platforms have added about 6.6 million consumer accounts and about 130 000 merchant users. As digitalisation has already taken place right from the initiation of transactions, this has provided a very essential and favourable environment for retail and logistics companies' digital operations and management, even enabling them to upgrade and transform. By seizing the opportunities brought by digital applications, it is possible to break new ground and find new impetus for business growth even in the face of headwinds in the operating environment.
I announced in the Budget early this year the Consumption Voucher Scheme to disburse a total value of $10,000 to each eligible people, and $5,000 consumption voucher under Phase I was disbursed in April. However, owing to the epidemic situation at that time, many retailers were unable to launch their promotional programmes. The $5,000 consumption voucher under Phase II will be disbursed during the summer vacation and it is hoped that this can further boost consumption in this traditional golden period.
We will announce this week the disbursement details of the Phase II of the Consumption Voucher Scheme. We have announced earlier two new SVF operators, including BoC Pay and PayMe from HSBC. Together with the existing four operators, including AlipayHK, Octopus, Tap & Go and WeChat Pay HK, the total number of operators that are available for selection has been increased to six. It is believed that the operators will launch a new round of publicity and promotions to attract customers. I also hope that through the market force of "changing the SVF" will permit consumers to enjoy the maximum discounts, and let the consumption vouchers bring a greater leverage effect, and broaden the development of electronic payment.
At the same time, if people choose not to change the SVF and stay with the SVF used for receiving the consumption vouchers last time, there is no need to go through any registration procedures. We will automatically check the information that has been registered before and let the eligible persons receive the consumption vouchers smoothly at the designated schedule.
With the use of consumption vouchers, e-payment has become more popular among consumers and merchants, providing favourable conditions for us to speed up the digitalisation of our economy. While we all agree with the pressing need in developing digital economy, questions remain on how we could work on the most critical parts, and how we should build the most important infrastructure system or platform. These are all urgent and crucial issues for the digitalisation to succeed. That is the reason why I proposed to set up a "Digital Economy Development Committee" in this year's Budget, with a view to gathering collective wisdoms from industry elites, experts and scholars to outline the blueprint for this important subject, so as to expedite and guide the future development with focus. The major duties of this Committee will include identifying key development trends and major driving factors, defining key factors for success, and on this basis establishing direction, strategy and key performance indicators. Also, the Committee should make suggestions on how to enhance the cooperation with major stakeholders and promote the development of data service industry, and make strategic recommendations on the digitalisation of different sectors. The preparatory work of the Committee is almost completed. I look forward to the close cooperation with the representatives of the industry and scholars. Together we will lay the foundation for Hong Kong's continuous economic upgrade and transformation in future.
June 12, 2022
