Archive for ‘Affluence’

30/09/2014

China’s Legions of Tourists Will Spend $155 Billion Abroad This Year – Businessweek

China is preparing for roadways clogged with cars and trains overloaded with travelers during its weeklong National Day holiday starting Oct. 1. But the real action for Chinese tourists will be happening overseas.

Chinese tourists in Paris

Over the full year, 116 million Chinese tourists are expected to travel abroad and spend $155 billion, up 20 percent over 2013, projects a new report by the China Tourism Academy. That compares with less than $55 billion that will be spent by tourists inside the country, a gap of more than $100 billion. “The deficit will further increase in the future,” predicts academy head Dai Bin, who was quoted in the China Daily.

China now sends more tourists abroad than any country in the world, according to China’s National Tourism Administration. Favored destinations include Australia, South Korea, and Southeast Asian countries as well as, increasingly, Europe and the U.S. Chinese tourists abroad will exceed half a billion annually within five years, says Shao Qiwei, administration chief of the English language paper.

In the first half of this year, Chinese spent $70 billion on overseas travel, up 20.7 percent from the same period a year earlier. Chinese travelers abroad spend almost three times as much per capita as foreign tourists in China, says Fan Zhiyong, an economist at Renmin University in Beijing, the official Xinhua News Agency reported.

Along with hotel lodging fees and restaurant meals, overseas spending includes plenty of purchases of such high-priced products as Rolex watches, Prada (1913:HK) shoes, and Chanel handbags. One-third of all Chinese travel expenditures goes to buy goods, often “luxury items—to take back home,” says McKinsey & Co. in a June report. Total spending could reach $194 billion by 2015, Morgan Stanley (MS) estimated last year.

via China’s Legions of Tourists Will Spend $155 Billion Abroad This Year – Businessweek.

16/09/2014

Almost Half of China’s Rich Want to Emigrate – Businessweek

Even as the number of Chinese millionaires grows, the number of those aiming to leave China is getting ever larger.

A shopper at Lee Gardens mall in the Causeway Bay district of Hong Kong

About half of China’s wealthy are considering moving to a new country within five years, says a just-released report by U.K.-based bank Barclays. The survey of more than 2,000 individuals around the world, all with personal wealth over $1.5 million, showed Chinese are more eager to emigrate than the very well-off in any other region.

Forty-seven percent of rich Chinese planned to move abroad in the next half-decade. That compared with 23 percent in Singapore and 16 percent in Hong Kong. One-fifth of rich Brits intended to emigrate, while only 6 percent of Americans and 5 percent of Indians had that plan, reported the South China Morning Post today, citing the report.

Not surprisingly, given China’s high-pressure, exam-based school system, bettering children’s education and improving their future job prospects were named as the main reasons to emigrate by 78 percent of respondents. A better economic situation was mentioned by 73 percent, while health care and social services were cited by 18 percent; the U.S. and Europe were the favored destinations.

“The reality is that most ultra-high net worth individuals in China are probably making money in China right now,” noted Liam Bailey, head of residential research at London brokerage Knight Frank, in the report. “So, for business reasons, they need to be relatively close. That might prevent some of them going further afield.”

via Almost Half of China’s Rich Want to Emigrate – Businessweek.

11/09/2014

Despite Sluggish Economy, China Has Yet Again More Millionaires – China Real Time Report – WSJ

Perhaps the Chinese economy is doing OK after all: The country’s ranks of the rich are growing slightly faster, according to a new report.

By slightly, we mean very: one percentage point.

Still, those who track the rich point to it as an optimistic signal. At the end of 2013, there were 1,090,000 people with a net worth of more than 10 million yuan ($1.6 million) and 67,000 with more than 100 million yuan, according to the Hurun Wealth Report 2014. That’s an increase of 4% for both categories. In the previous year, the growth rate was 3% and 2%, respectively, which represented the lowest increase over the six years Hurun has compiled the report.

Hurun, which also puts together an annual list of the richest people in China, said it came up with its headcount by two methods. First, it looked at the sales of high-end real estate and cars, as well as income tax returns and other data related to wealthy individuals. Then, it rounded out its headcount by taking into account macroeconomic data like gross domestic product growth and gross national product.

So who are the new rich? Mostly private business owners, said Hurun, who make up 55% of all millionaires (up from 50% last year). The report said the wealthy typically own a personal residence worth at least 2 million yuan, multiple cars worth more than 200,000 yuan as well as 1.7 million yuan in “investable assets.”

via Despite Sluggish Economy, China Has Yet Again More Millionaires – China Real Time Report – WSJ.

14/08/2014

Chinese Buyers Are Driving a Boom in Australian Real Estate – China Real Time Report – WSJ

Australian house prices are rising quickly and demand from China is increasingly driving the boom, according to a report by Hong Kong-based brokerage CLSA.

The report, based on interviews with 50 industry participants in Australia, including major realtors, finds Chinese are now “driving the residential property market Down Under” adding that the “phenomenal investment” will continue for at least three more years.

CLSA says China is now the top source of foreign-capital investment in Australian real estate and anecdotal evidence indicates that foreign investment from China has continued to increase in 2014, having slowly accelerated over the last 5 years. The stock brokerage did not attempt to put a value on the investment.

CLSA said good education and a clean environment were driving demand from China.

“Australia offers both and we see no reason why its fundamental appeal will diminish,” it added.

There are currently only limited curbs on foreign buying of Australian property. Any newly built Australian property can be bought by foreigners . The purchase of existing properties needs the approval of Australia’s Foreign Investment Review Board.

Government data this week showed house prices nationally grew by 10% in the year-to-June 30, with Sydney prices racing at 15% over the same period.

The issue of Chinese investment in Australian housing investment has prompted concern among Australians about the potential to be frozen out of the housing market, especially the highly desirable inner city markets of Sydney and Melbourne.

A government investigation into the issue of foreign investment in Australian property is underway and will report its recommendations in October.  One of the limitations of the debate over the issue is that there is not reliable data on how much money is coming into property from overseas.

Australia’s central bank has been watching the rise in house prices but has so far downplayed the role Chinese money has had on prices growth. If house prices continue to climb, the reserve Bank of Australia might have to raise interest rates at a time when the economy is weak and unemployment at more than decade highs.

via Chinese Buyers Are Driving a Boom in Australian Real Estate – China Real Time Report – WSJ.

13/08/2014

Chennai, home of Indian coffee, scoffs as Starbucks enters the market

When Starbucks opened its first coffeehouse in Chennai last month, its 50th in India, many people wondered why the chain had waited so long to come to the city. Was it because it was summoning up courage to enter the land of filter coffee?

The US chain, which has entered India in partnership with the Tata group, opened its first outlet in Mumbai in October 2012. But it took two years for Starbucks to come to Chennai, where it opened its first outlet in the Velachary area on July 10. It plans to open a second outlet soon, in the Alwarpet locality.

Chennai is famous for its ubiquitous filter coffee, a potent brew made in a cylindrical metal device with two compartments separated by a fine filter that allows water to percolate through a bed of coffee powder. The decoction that drips through into the bottom compartment is then mixed with milk and sugar to produce the famous Chennai filter coffee.

For now, youngsters are thronging the new Starbucks outlet, but filter coffee, brewed in most Chennai homes and available in low-cost eateries around the city, might yet prove to be formidable competition.

Starbucks’ representatives did not reply to specific queries about the chain’s prospects in Chennai. But because Starbucks is not a pioneer, it will not have to create a market for its style of coffeehouse: another chain has already done that.

Indeed, the first battle for coffee in Chennai took place a good 15 years ago, when the city got its first Western-style coffee house with Café Coffee Day‘s first outlet in Nungambakkam in 1999. Since then, the chain has grown to 74 cafés, becoming the largest in the city.

Starbucks, therefore, not only has another competitor in Café Coffee Day but also a fellow-traveller, albeit one that got an early start.

via Scroll.in – News. Politics. Culture..

08/08/2014

Bordeaux in Beijing? China Hopes to Build Must-See Destination For Wine Lovers – China Real Time Report – WSJ

Beijing may be better known for its pollution than its bucolic charms. But that isn’t stopping the government from trying to develop a rural region northwest of the city into a Napa Valley-style attraction.

Last month, the government hosted the 11th International Conference on Grapevine Breeding and Genetics in Beijing’s Yanqing county, a five-day affair involving wine tasting competitions and networking among grape breeders and geneticists from around the world.

In addition to hosting such a conference, the government also recently finished the construction of a so-called “International Grape Exhibition Garden,” which will consist of vineyards that they hope will attract an increasingly wine-loving public.

“We want to build our own Bordeaux in China,” said Pang Rongnian, the International Grape Exhibition Garden’s deputy director. He declined to comment on how much the government has invested in the garden’s creation.

The garden is home to 750,000 square meters of vineyards, along with a 2,500 square-meter greenhouse that will help nurture more than 1,000 kinds of grapes from more than 40 countries.

According to Vinexpo, which hosts regular wine and spirits exhibitions, China consumes more wine than any other country in the world. Last year,  China consumed more than 1.9 billion bottles of red wine in 2013, up 136% compared to 2008.

Also last year, auction house Christie’s set up the world’s first estate agency for wealthy Chinese to buy vineyards.

via Bordeaux in Beijing? China Hopes to Build Must-See Destination For Wine Lovers – China Real Time Report – WSJ.

04/08/2014

For a country obsessed with fair skin, why are so many Indians buying self-tanners?

Market research firm Euromonitor has just released a study on the grooming habits of the world. It has one rather surprising finding – Indians are slathering on massive dollops of tanning lotions. Indians are apparently second only to Chinese in consuming what the researcher calls self-tanning products.

It doesn’t add up.

Indians are the highest consumers of whitening creams, the same survey shows, and that is unsurprising. The country’s problematic preference for fair skin is well known. Fairness cream ads featuring big Bollywood stars are ubiquitous. In 2010, AC Nielsen estimated the size of the market for skin whitening products at $432 million.

But there is not a single well-known brand of skin-tanning lotions in the country.

via Scroll.in – News. Politics. Culture..

30/07/2014

China’s 1 Percent vs. America’s 1 Percent – Businessweek

A new study by Peking University’s Social Science Research Center pulls back the curtain a bit on China’s überwealthy. The richestpercent of Chinese households control more than a third of the country’s wealth, according to the July 26 study.

Most of that is tied up in real estate. In 2012, the study says, real estate accounted for 70 percent of all household wealth in China. (The bottom quarter of households, tellingly, control just 1 percent of China’s wealth.) The outsize reliance on real estate as an investment vehicle for both individuals and enterprises is troubling, given widespread concerns about a property bubble. In June, apartment prices fell in 55 of China’s 70 largest cities, according to China’s National Bureau of Statistics. In the southeastern city of Hangzhou, property prices dipped 1.7 percent that month.

But how do China’s rich stack up against America’s? The U.S. Internal Revenue Service analyzes income, not household net wealth, and in 2012, America’s richest 1 percent took home 19.3 percent of household income. But incomes rose almost 20 percent for the top 1 percent, whereas they inched up just 1 percent for the bottom 99 percent.

via China’s 1 Percent vs. America’s 1 Percent – Businessweek.

12/06/2014

China Minting Millionaires in Global Wealth Surge – Businessweek

Where do the world’s rich live? As has long been true, the U.S. has more millionaires (in U.S. dollars) than any other country, with 7.1 million. But China last year came in second with 2.4 million millionaire households, beating Japan with half as many. The number of millionaire families around the world reached 16.3 million last year, up from 13.7 million the year before.

Visitors crowd around a luxury yacht on display during the 19th China International Boat Show in Shanghai on April 10

All told, the total value of global private wealth grew far faster than global economic output, up 14.6 percent, to $152 trillion, compared with an 8.6 percent increase in 2012. Much of the new money originated in the Asia-Pacific region (excluding Japan), up by 30.5 percent, to $37 trillion. That put Asia in the No. 3 spot for riches, behind North America and Europe, according to the 14th annual survey on private wealth by Boston Consulting Group.

Driven by rapid GDP growth in China and India, Asia is expected to surpass North America and Europe as the leading source of global wealth in 2018. That year, the global pot of gold will total a bit less than $200 trillion, with the proportion from Asia projected to reach $61 trillion, slightly more than North America, with $59.1 trillion. “The Asia-Pacific region and its new wealth will account for about half of the total growth,” the report predicts.

via China Minting Millionaires in Global Wealth Surge – Businessweek.

06/06/2014

In China, Cruise Lines Hope to Woo Millions of First-Time Guests – Businessweek

Cruise lines are betting that the growing number of middle class consumers in China are keen to sample chocolate buffets and stroll the Lido deck. And that’s leading to an influx of ships being sent to sail year-round from mainland China.

The Carnival Sun Princess

China is expected to be the world’s second-largest cruise market (after the U.S.) by 2017, with growth rates far higher than in North America and Europe, the two regions where the industry has historically collected most of its profits. Carnival (CCL), the industry’s largest player, with 10 brands and more than 100 ships, plans to base four ships in mainland China next year, while also boosting its year-round fleet in Australia. The Asian Cruise Association estimated in a 2013 report that area demand will nearly triple to 3.8 million annual cruisers in 2020, with 1.6 million from China.

“The reality is that the [Asian] market’s huge, and it’s going to be very significant over the next 10 to 20 years,” Carnival Chief Executive Officer Arnold Donald says. “We have never been more committed to China as a market of great strategic importance for our company.”

via In China, Cruise Lines Hope to Woo Millions of First-Time Guests – Businessweek.

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