Chow Tai Fook Jewellery Group Ltd said it plans to shut about 15 of its Hong Kong stores after their leases expire this year, in a sign that major retailers are starting to withdraw from the city’s economy as anti-China protests continue.

In the first significant pull-back by a luxury retailer after months of fiery demonstrations that have driven tourists away, the worlds second-most valuable jewellery chain said in an emailed statement Tuesday that it will not renew the leases of a mid-teens number of stores in the year starting April.

Chow Tai Fook is closing the stores because it expects macro headwinds to continue to have an impact in the next six to 12 months, it said. Besides the protests that have at times crippled the city, volatile gold prices and U.S.-China trade tensions are also weighing on the company’s outlook.

According to its website, Chow Tai Fook currently has 86 retail outlets in Hong Kong. It is the second largest jeweller in the world by market value, after Tiffany & Co.

The city’s retail and tourism sector are poised for contraction after six months of depressed sales and a lack-luster Christmas season. Hong Kong, with its zero sales tax and plush shopping malls, was previously a gateway for luxury brands to reach Chinese consumers, who were known to travel to the city with empty suitcases meant to be filled up with shopping to take home.

With the number of tourists now at a record low, the first quarter of 2020 is likely to bring a reckoning for retailers: more than 5,600 retail jobs could be lost and thousands of stores shut down in the first half of 2020, according to a recent survey. Prominent restaurants and bars have also announced closure plans, while cosmetics retail chain Sa Sa International Holdings Ltd. said it was likely to shutter 30 stores in Hong Kong this year.

The Lunar New Year, when spending traditionally peaks in Hong Kong amid a flood of holidaying mainlanders, will also likely not provide its usual boost. Visitor numbers plunged 53 per cent during Christmas week compared with a year earlier, according to local media reports.

Chow Tai Fook said that its store closures will mainly be located in tourist districts such as Causeway Bay, Mong Kok and Tsim Sha Tsui and that it will continue to review store productivity and optimize its retail network in Hong Kong.

The jeweller, controlled by the billionaire Cheng family, has seen same-store sales fall for three consecutive quarters in Hong Kong and Macau. Its now focused on mainland China, where it plans to add 600 new stores in the year ending March 31.

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