Ernst & Young, one of the world’s largest accounting firms in the world is predicting that China will become the second largest luxury goods consumer in the world, second only to the US by 2015.
In a new report entitled ‘The New Lap of Luxury’ Ernst & Young predicts that luxuries consumption in China will grow by 20% annually between 2005 and 2008 to reach $10bn in 2015, nearly one third of the world’s total luxury goods consumption. For example, sales of luxury cosmetics and clothing are growing at 20% a year.
The firm estimates that Chinese consumers are already spending $2bn on luxuries now, accounting for 12% of the world’s total.
The report also notes that this spending is being aided by the increase in foreign travel by Chinese mainlanders. In 2004 Chinese travellers made 20m visits to overseas destinations and Ernst & Young, along with other bodies, expects this number to grow to 100m by 2015.
Meanwhile, a survey by the China Association of Branding Strategy shows that more than 100m Chinese consumers buy name brands regularly. The affluent population between 20 to 40 years old accounts for most of these purchases with many either entrepreneurs or professionals in foreign-funded businesses in Beijing, Shanghai, Dalian and other coastal cities in the east.
Asia & Pacific,