Outbound Chinese tourists to drive global luxury products market

Buying luxury products is one of the major reasons that Chinese nationals travel abroad, a sign that the country's increasingly rich population will boost worldwide luxury sales, according to a Friday report in the China Youth Daily, the official newspaper of Communist Youth League of China.

Some 64.6% of Chinese tourists bought luxury products on trips to Hong Kong in 2013, 46% while in Europe and 33.4% while in the United States, the report said, citing data from global online travel service Travelzoo.

In comparison, only 12% of China's inbound tourists bought luxury goods in 2013.

The report said a high disparity in price tags between the Chinese and overseas markets is the major reason for this. China charges 30%-40% in tariffs for imported luxury products, raising the price in China.

Tax rebate policies also help drive Chinese tourists' purchases abroad, said the report. It estimated that overall tax rebates from European countries to Chinese tourists can add up to €3 billion (US$4.1 billion) annually.

Binge shopping is often associated with increases in Chinese outbound travel as many Chinese choose to go abroad during the National Day and Spring Festival holidays, each lasting up to seven days.

A previous report issued by US-based financial services firm Bain Capital drew an identical conclusion. Of the money Chinese spent on luxury products in 2013, two-thirds of it was spent abroad, the company said.

New York multinational financial services provider Morgan Stanley predict that Chinese outbound tourists will spend an annual sum of US$194 billion overseas by 2015, nearly double the current level.

Source: xinhua via want china times