Ker-CHING! Probably the most direct – or crass – display at last week’s Art Basel Hong Kong fair was an array of Andy Warhol dollar signs, conveniently sited right by the entrance to the VIP lounge. Brought by first-time exhibitor Dominique Levy of New York, the silk-screened works were on offer at up to a steep $6.5m.
Levy was at the fair, along with 244 other exhibitors, because China represents a potential Eldorado for art dealers. In 2011 the world discovered with amazement that China had become the largest art market, beating the traditional heavyweights, the US and the UK, with sales of over $10 billion. And it had rocketed to this position with extraordinary velocity: in 1990 its share of the global art pie was an infinitesimal 0.4%.
Western gallerists rushed to set up galleries in Asia, or at least hire Chinese-speaking personnel. Hong Kong, with its business-friendly, tax- and censorship-free status, became the number one choice for attacking the Chinese market, and the gateway to the whole region.
That initial elation was short lived, however. Last year art sales in China and Hong Kong slumped by 40% overall, both on the mainland and in Hong Kong.
Great fall of China
The reasons for this dramatic downturn were threefold. Firstly, the frenetic growth of the art market – 20% per annum between 2009 and 2011 – was just not sustainable. And the Chinese economy was slowing. The rise in GDP fell from 9.2% in 2011 to 7.2% in 2012.
Finally, and most seriously for art sales, there was a crackdown on tax evasion by art buyers on the mainland. Last year two art shippers and a museum director were slammed into prison, and heavy fines were imposed on those found to have under-declared values. This, inevitably, sent a chill through the market. Since then Chinese art galleries have been struggling to make ends meet and a number have closed, reports Cheng Xindong, the Beijing-based director of the Art Gallery Association.
And yet at the same time mainland China is in the grip of a frenzied museum-building boom. In the last few years, about 100 museums have opened annually with a peak of nearly 400 in 2011, according to the Chinese Society of Museums. These museums are not only in the major urban centres, such as Shanghai – with its new, $64m Power Station – or Beijing, where the National Museum of China recently emerged from a $400m revamp. Even in far-off Yinchuan, at the point where the Great Wall of China meets the Yellow River, almost $300m is being lavished on an arts centre.
Private collectors are also opening museums, such as the Shanghai billionaire investor Liu Yiqian and his wife Wang Wei, who have already opened one, and are about to launch a second. Liu has dropped huge sums to buy art: he paid $27m to buy a 16th-century Ming scroll at auction in Beijing in 2009.
So China is still seen as a potential goldmine, even if the bulk of sales are in the traditional fields such as ceramics and scroll paintings. This is why dealers jetted in to exhibit at the Hong Kong fair. And with Christie’s spring array of auction sales being held at the same time, deep-pocketed collectors from all around the region – from the Philippines, Indonesia, Malaysia, Taiwan and Korea – were also in town for what has become Hong Kong’s ‘art week’.
Then there were the socialites: the Russian billionaire Roman Abramovich with his art-loving partner Dasha Zhukova; Yahoo! co-founder Jerry Yang; Wendi Deng Murdoch, wife of publishing mogul Rupert Murdoch; model Kate Moss and Hong Kong pop star Edison Chen. The Chinese dealer and all-out glamour girl, Pearl Lam, who never does things by halves, was showing colourful paintings by Zhu Jinshi in her Pedder Building gallery and threw a splashy dinner at the famed Peninsular Hotel to celebrate.
Collecting contemporary art in Hong Kong is a new phenomenon, and the absence of a good museum infrastructure has not helped develop tastes. In addition, there is a strong overlap with the luxury goods market, aided and abetted by the companies’ own thrust into the art world: vodka, cigars, watches, cars and champagne were actively present.
As a result, particularly popular were ‘brand names’. Eighteen works by the Japanese artist Yayoi Kusama, whose profile was immensely enhanced after she collaborated with the Louis Vuitton shops, flew out of the Victoria Miro stand at prices of up to $2m. The Los Angeles gallery Blum and Poe did well with the Japanese artists Yoshitomo Nara and Takashi Murakami – who of course designed handbags for Vuitton.
Chinese artists were popular, and MadeIn Company’s Play 201301, 2013, a Gothic cathedral hung by ropes from the ceiling and made of bondage-style black leather, zips, chains and tassels, sold to the Australian White Rabbit museum for $325,000.
Sales at the fair were strong overall, and at the weekend Christie’s racked up almost $100m in two auctions of contemporary Chinese art. While the Warhols apparently didn’t sell well, there is little doubt in most people’s minds that China has a more than auspicious future for the art trade.