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Nothing to be proud of

(China Daily)
Updated: 2010-12-31 13:26

Goldman Sachs' latest figures show that Chinese consume $6.5 billion worth of luxury products a year. It says China's has been the fastest growing luxury goods' market in the world for three consecutive years. But this development is cause for worry, not celebration, says an article in China Youth Daily. Excerpts:

Potential luxury customers in China are estimated to increase from 40 million to 160 million in the next five years. In recent years, consumption of luxury goods in China has risen at a stunning pace.

But in complete contrast to the glorious record is China's population of poor people, which is close to 100 million now that the 12th Five Year Plan (2011-2015) has raised the standard per capita income to 1,500 yuan ($226.44).

Chinese people between 25 and 40 years of age are the main consumers of high-end fancy brands, as opposed to the West where generally the 40- to 70-year-olds can afford them.

What makes the younger generation the most important buyers' group of luxury goods in a country where tens of millions of people are struggling with poverty?

Not all of Chinese luxury goods' consumers are rich. In fact, many of them earn a moderate salary and others, such as students and the so-called NEET group, may not even be financially sound.

Many of them over-spend using credit cards to satisfy their sense of vanity. After pinching and scraping for months, some use all their savings to buy some fancy cosmetics or clothes, which they usually mistake as a sign of social status.

What they are not aware of is that even some wealthy people don't rely on fancy brands to boost their self-esteem and confidence.