If you listen really carefully, you can hear the world smallest violin playing for all the corrupt officials in the People’s Republic – the campaign against corruption and wasteful spending means they’re no longer allowed to splash out on 8,888 yuan on bottles of fine tiger penis wine or whatever they drink.
However, there’s always the law of unintended consequences (or rather, supply and demand): since the campaign started last year, a number of companies that cater to the needs of the rich and the powerful are now feeling the pinch.
Around Christmas it was reported that Maotai, the brand of choice for the drinker in want of some conspicuous consumption, was hit hard by the campaign.
Likewise, Compagnie Financière Richemont, which owns the Montblanc and Catier brands, has seen its sales slowing. It doesn’t take a Benedict Cumberbatch to see why: according to one luxury goods insider, “As much as 60% of expensive watches in China are gifted to officials.”
Meanwhile, corrupt officials have been rushing to sell luxury properties and move their assets abroad. According to a leaked goverment corruption report, a whopping $1 trillion was smuggled out of China in 2012 alone. (To put it in perspective, that’s about three billion bottles of Maotai).
A bit closer to home, the average turnover of high-end eateries in Beijing is reported to have fallen 35%, according to National Business Daily. (Being a respectable newspaper, NBD refrained from mentioning similar figures for escort services or top-notch brothels, but we’re all able to read between the lines.)
The paper mentions Beijing Xiangeqing, an upmarket chain of restaurants, is revamping its entire business model in the wake of the government anti-corruption campaign. Dishes that cost more than 200 yuan are going to be taken off the menu. There are also rumors that the chain will axe one third of its staff.
Mistresses all over China are no doubt shedding bitter tears over the rapidly declining dining options, but don’t worry, we’ll look into starting a charity foundation that will aid them in these difficult times.
We’re still waiting to see how the anti-corruption drive will affect Audi sales.
“Austerity” with Chinese characteristics
There is now a lot more meat on the market for us!