Turning canvas into cash in
China By Robert Hartmann
HONG KONG - As the Chinese become
increasingly affluent, a market for art is
emerging in the Middle Kingdom, providing yet
another channel for commercial speculation for
members of a nouveau riche who are
generally more interested in making money than
basking in creative genius.
Many observers
have pointed out that overemphasis on the
commercial side of art collection and the
generally pedestrian tastes of China's art
collectors will prevent the country from
becoming a major
art-collecting center any time soon.
November 16 saw the grand opening of
another annual Shanghai International Art Fair at
the city's World Trade Commercial Center. While
the grand scale of the fair was really dazzling,
some sponsors felt that many masterworks were put
on display merely for decorative purposes.
It was clear that many domestic art buyers
were only interested in the commercial benefits of
acquiring works and had little, if any,
appreciation of the esthetic side. Some say this
has set the tone for China's art world, driving
the market in the wrong direction.
One can
see from the main theme of the fair, "Invest in
Art and Save for the Future", that artwork has
been reduced to a mere investment commodity, one
that can often offer a better return than the
stock market. It is not uncommon to see
white-collar mothers buying a painting or two at
the fair, hoping to use possible profits to pay
for the future education of their children.
The consensus among international art
experts at the fair was that Chinese art is of a
high quality and that the country's artists have
great potential. However, they stressed that the
cultivation of the art market is lagging far
behind the world standard, that it needs to become
more integrated with outside markets, and that
there is the hidden risk of a market bubble.
Statistics show that China boasts the
largest number of art collectors in the world and
that its art market is growing faster than any
other. However, China is still a long way from
being a big power in the field.
Some
Shanghai artists are of the opinion that,
notwithstanding the steady rise in art prices in
recent years, China's market is still only at the
takeoff stage. There has been a lot of confusion
created by the display of both good and bad work
in the same venue, making the market vulnerable to
manipulation. They believe that it may take five
years or so for the market to mature to the point
where esthetic standards for individual shows are
properly established.
In 1996, the year of
the first Shanghai International Art Fair, China's
annual art sales barely amounted to 200 million
yuan (US$26 million). Last year, this figure
reached a record 20 billion yuan and the number of
art collectors in China rose above 70 million.
However, compared with the art-collecting
powers in the world, China's market capacity is
still very small. According to an estimate by Wei
Shaonong, an art critic and deputy dean of the
East China Normal University's School of Design,
art sales in 2004 reached about $60 billion in the
United States, $39 billion in the European Union
and $30 billion in Japan.
The biggest
problem in the development of China's
art-collection market, according to some experts,
is market disorder. In the United States and
Europe, art galleries, art fairs and art auctions
are coordinated in a mature system. Normally, the
art galleries constitute the market's first level.
Auction firms have to obtain their artworks mainly
from the galleries. In China, the auction
companies reign supreme, replacing or bypassing
the galleries to obtain work directly from the
artists. Experts see this as a cause of market
disruption. There are now more than 200 art
auction companies in China, chiefly in big cities
such as Beijing, Shanghai and Hangzhou, where
vicious competition has gone unchecked.
"China's art market is frantically
speculative nowadays," remarked an artist from
Beijing. "Systematic art collectors are not to be
found. Many buyers just [cannot] distinguish good
[from] bad. They only wait for a good price rise
and sell out to make money. For example, a certain
painting initially priced at a few hundred
thousand yuan could be 'cooked up' to 2 million
yuan within just two years' time, and this is just
what they are waiting for.
"A market
bubble is definitely there," the artist added.
"Even the painter himself feels frustrated by
being so distorted."
Another striking
example is the high-flying success of the painter
Liu Linghua, whose oil paintings on Chinese
cultural topics soared in selling price from a
mere 20,000 yuan to 1 million yuan to 10 million
yuan in just two years. According to Chinese media
reports, Liu came from Xian, an ancient city in
the northwestern province of Shaanxi. Liu was
originally a penniless artist, who could hardly
even afford to buy canvas for his painting.
After he had been "discovered" and
financed by the Wide Vision Network TV Co of
Shanghai as its contract artist, he changed
direction to painting on topics that were well
received by the international art market, such as
the "18 paintings on Chinese cultural
quintessence", including picturesque scenes from
the Peking Opera such as The Drunken Concubine,
The Hua Rong Path, etc. His quick success has
been known as the "Liu Linghua phenomenon", which
is widely seen as a manifestation of the highly
speculative nature of today's art-collection
market in China, which is characterized by the
"marriage between art and capital".
The
lurking danger of a bubble is worrying domestic
art investors, making them feel as though they are
walking on thin ice. Some foreigners invested in
Chinese contemporary art in 2005 but, finding that
there was not much to buy, they turned their
attention to other countries. However, in 2006, a
big wave of capital flooded into China, attracted
by "cooked up" price rises in the art market.
All these point to the necessity of
serious efforts being made to control and
coordinate China's art market to put it on the
right path.
Robert Hartmann is a
Hong Kong-based freelance writer.
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