This morning we have some very telling data of the dire economic situation in Hong Kong: Swiss watch exports to Hong Kong crashed in October as social unrest continues to gain momentum in the city as demand for luxury goods evaporates.
The Federation of the Swiss Watch Industry published a new report Tuesday on Swiss watchmaking for October, detailing how shipments of steel and precious metal watches to Hong Kong plunged by as much as 30%.
Hong Kong's tourism industry has suffered the worst downturn in a decade, as violent protests shut down streets and major shopping districts. Protests have become more violent in the last several months, forcing many wealthy mainland Chinese to abandon their visit to the city as it plummets into economic and social collapse.
The city entered a technical recession in the last several weeks, with its retail industry, comprised of the world's luxury brands, experienced some of the worst declines in sales ever.
Watchmakers, particularly ones from Switzerland, have been reeling from the plunge in sales, as at least 30 major shopping malls have had to shut down, on and off across the city for the last five months amid continuing social unrest.
Luxury goods, such as jewelry, are usually half the cost in Hong Kong than in mainland China, but with protests continuing to spiral out of control, and the tourism industry collapsed as shopping districts are shut down, it seems that the Hong Kong crisis is sparking a slowdown contagion across the world.
Though Swiss trade with Hong Kong fell, Swiss watchmakers saw global exports increase by 1.5% in October. Growth in the first ten months was around 2.7%, far from last year's annual pace of 6.3%, indicating the global economy has yet to bottom.