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Why Chinese art buyers are not buying in China

Updated: 2011-02-18 10:26

By Yu Ding (China Daily European Weekly)

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Over the past few years, the Chinese art market has been booming in spite of the global financial crisis. In 2010, the art market reportedly grossed an estimated 57 billion yuan (6.4 billion euros), 40 billion yuan more than in 2009.

Chinese art collectors and investors have now become important buyers in the international market and their interest in buying Chinese arts and crafts in the international auction market is rising. They have shifted their focus from antiques to Chinese contemporary arts. Some are also taking an interest in buying artworks from the West, which hasn't yet grown into a trend.

Chinese people started to buy arts and crafts in overseas market at the beginning of the century. In 2000, Chinese artworks bought overseas were resold in the domestic market, which is legal according to the Law of the People's Republic of China on the Protection of Cultural Relics. Revised in October 2002, it allows the lawful circulation of cultural relics bought in an auction.

The law has helped overseas artworks return to China and after the law was revised, artworks have become the hottest items in the domestic auction market. Statistics show that art pieces brought back through overseas purchases account for more than 50 percent of the total number of auction items. Chinese paintings and calligraphy as well as porcelains from the Qing (1644-1911) and Ming (1368-1644) dynasties account for more than 80 percent of the total number of deals at auctions.

In the past five years, Chinese buyers have broken many records in New York and Hong Kong auctions. On Nov 11, Bainbridges Auctioneers held a personal inheritance auction in a London warehouse. A famille rose, hollowed-out porcelain bottle produced during the reign of Emperor Qianlong in the Qing Dynasty was sold to a Chinese collector for 51.6 million pounds (61.2 million euros), breaking the world record in a Chinese antiquity auction. The move was called "China patriotism" by the British media.

Why do Chinese take the trouble to buy arts and crafts in Europe, but not in China? In my opinion, the normalized management of the international art market and the price gap between domestic and international art markets are the primary reasons why Chinese buy arts and crafts overseas.

Authenticity is an important issue for arts and crafts, but most domestic auction houses don't have guarantees of authenticity. Counterfeit pieces have scared away many buyers. The auction houses which have been around for decades and which have undisputable reputations like Sotheby's and Christie's are unlikely to sell fake items.

Another reason why Chinese artworks are bought overseas is the different level of interests among buyers.

International buyers don't share the same interests in Chinese arts as Chinese buyers. This ultimately creates opportunities for good bargains for Chinese buyers. On July 12, 2005, for example, a Yuan Dynasty (1271-1368) pot was sold for 230 million yuan, which shocked many. Different from the famille rose, hollowed-out porcelain bottle produced during the reign of Emperor Qianlong, the pot is more a representative of typical Western aesthetics. It was also bought by a Westerner.

The aesthetic difference of Chinese arts in the international market makes it possible for Chinese collectors to buy top-level arts and crafts. Many Europeans cannot understand why a Chinese buyer would spend 500 million yuan on porcelain. But to many Chinese, the excellent porcelain arts made during the Qing Dynasty will not turn up in auctions for the next 10 years. It is this scarcity that has driven prices sky-high.

Those Chinese buyers who entered the international art market have started to buy some pieces created by European and American artists. Their collection ranges from 19th century oil paintings to contemporary artworks. Works by Picasso, Anselm Kiefer and Andy Warhol are included in their collections.

Chinese artworks have garnered top prices in domestic and international auctions. The prices of many art pieces by 19th century European masters are 10 times lower than those of Chinese contemporary artists.

However, Chinese collectors hardly buy Western arts and pieces. Although efforts have been made by several art institutions to promote European and American arts in the Chinese market, the results are less than satisfactory. Why?

First, most Chinese don't know how to appreciate Western art. Some Western art collectors cannot find a Chinese collector who shares the same interests.

Second, from an investment perspective, it is still hard for the Western art buyer to cash-out in China, given the fact that the domestic market is still not mature. Third, Chinese authorities still impose huge taxes on imports of art, which have hindered their diffusion in China.

But by far the biggest reason is the difference in aesthetic appreciation between the West and East.

Although an appreciation for Western art was taught in China at the beginning of the 20th century, teaching art history was still inadequate due to the influence of wars, political movements and social change in Chinese history. Chinese people don't really know how to appreciate Western art. We don't even have an international arts museum. Most Chinese people have no direct access to Western arts.

However, I still think that the situation might change in the next decade and more Chinese buyers will buy Western art pieces. In my view, Chinese collectors can do what the Japanese did during Japan's economic rise in the 1980s. China should do more to help our people elevate their taste in art.

But in the meantime, more Chinese artists are increasingly being represented by international galleries. Their works will possibly appear in international art expos, where many collectors buy up European, American and Asian art pieces.

The author is vice-dean of the Humanities College at the Central Academy of Fine Arts. He is also the co-author of Respect for Art: Visual Arts Administration and Management in China and the United States, and was a visiting professor at Columbia University in the Arts Administration Program.


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