China’s million millionaires love to shop, but they prefer not to do it in China – and the appreciation of the renminbi is making them even keener to get out of town before opening their pocketbooks.
According to a recent report from those purveyors of all wealth-based research in China, the Hurun Report, shopping is one of the biggest reasons that rich Chinese travel overseas – making them the biggest tax free shoppers in the world for the first time last year.
Global Blue, the tax free shopping experts, says in a newly published report that the average spending of outbound Chinese was $1,026 last year, more than twice as much as Russians, US and Japanese tax-free shoppers – and that represented more than a 100 per cent increase over 2009 spending.
Beijing seems keen to get its hands on more of that spend, by reducing punitive import duties to persuade China’s big spenders to fork out at home.
A spokesman for the ministry of commerce said last week that China would cut import duties, and Chinese newspapers speculate that the move could come before the next week-long national day holiday in October – which Hurun identifies as a popular time for overseas travel.
Hurun also points out that rich Chinese hate travel groups just about as much as the rest of us: 80 per cent of Chinese wealthy eschewed group travel. But even more surprisingly, the average size of the millionaire travel group was four – which, given China’s one child policy, must mean quite a few millionaires travel with Grandma; but then again, given the popularity of birth tourism – babies born overseas to rich Chinese parents – maybe the fourth traveller is in nappies.
Lower taxes may not keep the Chinese at home for long: the Hurun Report found that four out of five Chinese millionaires are thinking of sending their children overseas to study. “The richer they are, the younger they seem to want to send their children overseas” says Rupert Hoogewerf of Hurun. Shipping all those heirs overseas will keep the Chinese in the air visiting them – even if Beijing persuades them to spend less time in the duty free.