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China to overtake Japan as top luxury goods consumer

09-27-2011 11:52 BJT

China is expected to top Japan to become the world's largest luxury consumer this year, a research report on luxury goods released last week by the Hong Kong and Shanghai Banking Corporation (HSBC) said.

Statistics revealed by the report said China overtook France to become the world's third biggest importer of Swiss watches in the first half of this year, a 49 percent increase over the same period last year.

The report said that part of the cause is the mindset of Chinese to show-off, saying some Chinese overspend on luxury items, a habit they cannot necessarily afford.

As well, it is widely thought in China the possession of luxury goods factors a lot in judging a person's social status, according to the report.

"It is not weird for China to become the largest luxury consumer owing to its overwhelming population and its recently intensifying purchase power prompted by the surging economy," Yan Jun, the CEO of the Beijing-based Ecole Fashion and Luxury Consulting Limited, told the Global Times on Monday.

Yan said there might have been a number of people who purchased extravagant products only to show off their wealth five years ago, for example, the Shanxi coal bosses.

"But an increasing number of consumers bought luxury goods because they can afford them either for their daily necessities, or as reward for themselves, or even only to experience the luxury rather than to satisfy their showy vanity," Yan added.

There were 146 Chinese billionaires on the Forbes China Rich List, released on September 8 this year, 18 more than that of last year.

China has 500,000 people who each own investment assets worth more than 10 million yuan, said the 2011 Chinese Private Fortunes Report released by the China Merchants Bank in April.

There were 197 million women aged between 30 and 49 in China in 2009, accounting for 17 percent of the total population. The research shows the group has an increasing potential in luxury goods consumption, the HSBC report said.

"Billionaires and women play a role, but not a dominant role in booming the luxury industry," said Yan, adding that a growing number of luxury manufacturers are also now offering low-end luxury commodities, such as small wallets and pendants, to gain more consumers.

 

Editor:Zhang Rui |Source: Global Times

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