In the past, trips abroad often included personal luxury purchases for affluent Chinese consumers looking to take advantage of currency and tax benefits.
A salesperson showing the limited edition launched by Emporio Armani to welcome the Year of the Tiger at a duty-free store in Haikou, south China's Hainan Province, January 15, 2022.Stocks of many luxury fashion houses reliant on Chinese consumers rallied on China's reopening, but those customers may not necessarily be buying the goods overseas.
Similarly, Cartier-owner Richemont shares have gained about 13%, while Dior rose more than 11% from early December.The "revenge spending" that comes with the return of overseas travel will lead to an increase in consumption of luxury goods in 2023, Jessy Zhang, an analyst from Daxue consulting told CNBC.
"China's domestic luxury consumption should far exceed that of overseas luxury consumption," said Zhang, who estimates that in the long run, domestic luxury consumption will account for 70% of the Chinese luxury consumers' spending, and a mere 30% from abroad.
China's GDP grew during lockdowns -