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Putting heart into the art

Updated: 2013-12-23 09:25
By Li Xiang ( China Daily)

Putting heart into the art

Sotheby's, partnered with Gehua Cultural Development Group, raised a total of $37 million in its auction in Beijing this month. Photo Credit / Goes Here

Changing paradigms

The art market has developed into a business worth more than $12 billion in terms of annual sales in China, a country where it barely existed 20 years ago.

Even though the Chinese art market has had the strongest growth, many experts feel it is still far from being a genuine art-trading center.

"China's art market is being pushed forward little by little. In fact the market is not fully prepared for such a status as far as the buyers, the operators and government policy are concerned," says Wang from Beijing Gehua Art Co.

Some experts say the sales figures at auction houses fail to reflect the real size of the Chinese art market because of the high non-payment rate. According to research by the European Fine Art Fair, up to 40 percent of the auction proceeds in the Chinese art market were unpaid or only partly paid.

Vellenga, the fair's representative, says: "If you deduct that percentage, the total sales in the art market of the Chinese mainland will not be No 1 because the non-payment rate at European and American auction markets is almost zero. So the US art market is still the strongest one," .

But the vast potential of the Chinese art market and the strong purchasing power of Chinese buyers are undeniable as the market gradually matures and more high-end institutional collectors are entering the market and view art as an effective way to better manage their investment portfolios.

Dalian Wanda Group's recent Picasso purchase was the first time that a Chinese company competed with top-end Western collectors for a sought-after art piece with an unprecedented price.

"More and more Chinese art buyers have begun to realize that the real hard currency in the international art market is the mainstream masterpieces of Western art instead of the ancient or contemporary Chinese arts," Wang says.

"Therefore, it is a rational investment choicefor large institutional collectors to allocate some European art in their art collections."

It is estimated there are now only about 30 large collectors of Western art from the Chinese mainland. But experts estimate the number will increase rapidly as the market accumulates more knowledge, experience and practice in the field.

In addition, the potential of Chinese art buyers also lies in their emerging interest in other art forms including Western art, experts say.

"The interest from the Chinese mainland now plays a role not only in the market for Asian art categories but across most of our international collections from furniture to silver, books to Victorian art and old masters to contemporary art," says De Vos, Christie's European head of Chinese Works of Art.

"Asian collectors, including those specifically from the Chinese mainland, have an incredible appetite and intelligence for art and are becoming increasingly sophisticated in their purchases across all categories and at every price level," she says.

"Looking at 2014, with our program of sales in the Chinese mainland and the development in Hong Kong, I am confident that Asia's role as a prominent art center can only rise in the years to come."