Thousands lose jobs as eateries closeTop News | Sophie Hui 10 Oct 2019
The first wave of retail closures has hit Hong Kong, with about 100 restaurants shutting and 2,000 workers losing their jobs in the past month, a catering group says.
Henry Ma Kin-leong, vice chairman of the Institution of Dining Art, said to reduce costs, many restaurants have started to lay off part-time workers and requested full-time workers to take unpaid leave.
He expected the wave of business closures to continue as income cannot cover the rent.
Ma said restaurants in tourist areas including Causeway Bay and the Yau Tsim Mong District have been seriously affected, as well as those in shopping malls, many of which closed during the protests.
He also said many closed restaurants have not been taken over by new owners due to the business environment.
His association and the Hong Kong Retail Management Association are calling on the government for more relief measures and for mall owners to reduce rents.
Most shopping malls have refused to lower rents, including those under the Link REIT and MTR Corp, the groups said.
Annie Tse Yau On-yee, chairwoman of the Hong Kong Retail Management Association, said some landlords have offered to cut rent by 10 to 30 percent for several months, while Swire Properties and Hysan Place have offered support measures to their tenants. But most shopping malls have insisted on maintaining rents.
She said retail sales in August plunged 23 percent. Business in high-end consumer goods like watches and jewelry dropped almost 50 percent, while sales of clothes, footwear and cosmetics fell 30 percent.
Tse expected sales in this year's National Day Golden Week would drop significantly from last year. She hoped the government can have more relief measures on rates concessions and electricity tariffs, as well as calling on mall owners to reduce rent.
Ma said the current relief measures were not helpful enough to the industry.
"If there are certain subsidies on rates, licensing fees, water bills, sewage charges, electricity tariffs and gas charges, that would be of great help to us," he said.
"It would be even better if they can suspend or waive the profits tax of last year," Ma added.
The chairman of the catering group, Simon Wong Kit-Lung, who is also the executive director of Chinese restaurant chain LHGroup, said the chain has suspended business at three branches as the loss was too big.
He said on Facebook yesterday that the operation of Japanese restaurants Mou Mou Club in the World Trade Centre in Causeway Bay, and Mou Mou Geki in Mong Kok's King Wah Centre, as well as a Korean restaurant, Yoogane, in New Town Plaza in Sha Tin have been suspended until further notice.
"Business in those three shops was moderate, and they are in the core areas of the social movement in the past few months. This month so far there has been only 10 to 20 percent of business compared to normal days," he said.
Wong said the US-China trade war has disturbed the economy in Hong Kong, while the early closure of MTR services these days made the situation deteriorate faster.
Meanwhile, Liberal Party lawmaker Felix Chung Kwok-pan said the retail doldrums was worse than SARS in 2003 due to night-time protests and early suspension of MTR services.
"Even if business during SARS was poor, shops would still open to see if there were customers, but today they will close their doors and do not dare do business," he said.
"If this continues, I think in a short period of time many shops will close down, and the unemployment rate will go up quickly. Is this what the people in Hong Kong would like to see?"