Hong Kong’s retail is getting its mojo back. Once branded a shopping paradise, the sector fell on hard times due to the Covid-19 pandemic and then across-the-border shopping and dining. But it is, as they say, back in business. Sales in May rose almost 8 per cent year on year, extending the growth streak into its 13th month.The value of retail sales for the month reached HK$33.8 billion (US$4.3 billion), up from HK$31.3 billion in May 2025. It rose by 10.6 per cent for the first five months of 2026, compared with the same period last year. The mainland’s Labour Day “golden week” holiday, which flooded the city with visitors, served as a catalyst.The “going north” trend has not been a death sentence for local retail, as critics claimed. While it’s true that people are heading to Shenzhen for better prices and food, local retail is adapting and thriving. Innovation is paying off for shops that try new things to cater to demand rather than complaining about competition and disappearing customers. Big events are a game-changer. Whether it’s concerts or sports, they are drawing mainland visitors as well as locals.These include not only “budget travellers”. Indeed, a common complaint about visitors who just eat cheap noodles on the street is not borne out by the statistics.Hotel prices are a tricky spot. There is pressure with regard to high room rates, which might be a barrier for visitors, although it is a tough situation for the struggling hospitality industry.