A fine distinction
Unrest in the Middle East, natural disasters in Japan and the volatile equity market in the West have cast a cloud over this year's European Fine Art Fair (Tefaf) but dealers were quick to find a silver lining in the burgeoning Chinese economy.
Held in the Dutch city of Maastricht from March 18 to 27, Tefaf opened with a report that said the Chinese mainland had overtaken Britain as the world's second biggest market for art and antiques. From 2009 to 2010, it more than doubled in value reaching Euro9.8 billion (HK$99.2 billion) and a 23 per cent global share, says the report by Clare McAndrew, a Dublin-based arts statistician and consultant. The US still dominated with 34 per cent, but its margin has narrowed significantly.
'New buyers and sellers from China and other emerging markets have helped to protect the art market from some of the downside risk it would have been subject to had it still been reliant primarily on the UK, US and other mature European markets, and undoubtedly strengthened and accelerated its recovery,' continues the report.
'Looking forward, wealth and art buying remain highly concentrated in a very small fraction of China's population which is a strong indicator for the potential future growth in art sales.'
New Chinese buyers had certainly created a degree of buzz at The Maastricht Exhibition and Congress Centre, with a number of dealers putting their faith in the growing demand for art from the mainland. London-based dealer and the fair's chairman Ben Jannsens reportedly sold four pieces of imperial jade on the first night of the event, including one to a new Chinese client.
It was also noted that some of the Chinese buyers had cast their nets in less predictable territory, descending on Japanese works of the art dealer Malcolm Fairley, and picking out several moderately priced works from his stand.
However, Chinese antique furniture dealer Andy Hei, who has attended Tefaf for three years running as visitor, remained cautious of these newcomers. If organisers are looking for collectors who are serious about their art and collecting, he says, they will only find a few in this group.
'A collector, in my view, has to fulfil the following conditions: they have to first and foremost love the art they collect, they have to have the financial power, they have to have a collection that has some kind of rationale behind it, and they have researched either themselves or through other institutions what they collect,' says the 43-year-old who runs a family business on Hollywood Road and is the founder and director of the annual antiques and art fair Fine Art Asia.
'Right now, these collectors are few and far between among the new rich on the mainland. What we have instead are mostly investors and speculators who buy in order to sell for profits.'
Hei says new mainland art buyers are young millionaires, mostly in their 30s or 40s, who don't necessary know or understand what they buy: 'They make purchases not out of interest but because they have the money. They have this 'others have it so I should too' mentality. There are also those who buy Chinese antiques because they are nationalistic or because of face.'
Christian Deydier, a leading expert in Chinese archaeology, is equally sceptical of this new breed of mainland buyers.
'I think the Chinese [antiques] market is extremely dangerous,' says the influential Paris-based antiques dealer. 'New rich collectors arrive on the market and are ready to pay any price. They like jade and especially imperial seal, painting, gilt bronze Buddha, and imperial porcelain. Recently, they decided to buy archaic bronze so the prices in [recent] New York [auction] sales were crazy.
'The problem is very often they buy one piece and after a few days they decide to cancel. They do the same at auctions and I do know there are a lot of problems for the auction houses to be paid.'
In 2009, the art world was shocked when Chinese antique buyer Cai Mingchao refused to pay up for two bronze heads that he successfully bid for, at HK$150 million each, at the Christie's sale of Yves Saint Laurent's art collection. The bronze heads of a rat and a rabbit were looted by foreign troops from Beijing's Summer Palace in 1860 and Cai said his decision was an act of patriotism.
A more recent example is the Qing dynasty imperial vase that was sold to an anonymous Chinese buyer for a record price of GBP43 million (HK$537 million) by a suburban auctioneer in London. The sale made international headlines last November and then again last month when the buyer failed to pay up. Auction houses and dealers now risk taking on bids that will subsequently fall through.
But Deydier points out it's a fact that Chinese buyers 'are everywhere', from small auction houses to big fairs. 'They are really the most active buyers but the least reliable. In future, I am sure Chinese buyers will learn the price. Quality and price will still be strong for good and exceptional items, and prices will come down for medium range items.'Hei says Tefaf, which this year attracted more than 55,000 visitors, would have fared better with mainland buyers had it not coincided with Asia Week New York, which ran from March 18 to 26, when specialist dealers, auction houses, museums and Asian cultural institutions come together to put on the year's best shows. He says the Maastricht fair, which showcased 260 exhibitors from 16 countries in nine sections, remains a quintessential Eurocentric event for the old money.
However, he says a small group of serious Chinese collectors is emerging and they are slowly looking at works of art that are not only Chinese but Japanese and western.
'This is a good trend because it shows that the Chinese taste is getting more sophisticated,' says Hei. 'They are buying foreign artworks because they genuinely like them and that in turn reflects their internationalism. It is a step forward.'