Luxury retailers beware: China’s super rich no longer feel safe flashing their wealth

March 8, 2013
March 8, 2013

China’s new leader Xi Jinping has vowed to fight corruption in an attempt to dampen public anger about his country’s gaping social inequality.

That could be why rich businesspeople are arriving at this year’s annual parliamentary meetings much more modestly dressed than usual.

The delegates to the twin meetings of China’s rubber stamp parliament, the National People’s Congress, and a powerless advisory body called the Chinese People’s Political Consultative Conference, this year included 83 billionaires. This Chinese superclass tends to be well connected to the country’s top leaders, sometimes by blood. And they used to arrive at the “two meetings,” which are covered heavily by the loyal state-owned media, clad in designer suits topped with fancy accessories.

But in yet another bad sign for global luxury retailers, this year’s rich delegates are leaving all obviously expensive accoutrements at home, as these images show (text in Chinese). Luxury retailers’ great success in China could be reversed under Xi’s anti corruption drive which has scared top businesspeople and officials into hiding their wealth to guard against any future graft crackdown.

Li Xiaolin, the only daughter of former Chinese premier Li Peng and the CEO of hydropower company China Power International Development, attended last year’s meetings in a $2,000, salmon pink Emilio Pucci suit. That caused outrage on Chinese microblog Sina Weibo, where a photomontage of her wearing the item alongside an image of poor Chinese village children in dusty brown clothes was circulated widely.  This year, pictures of Li surfaced with her wearing a black suit of unidentifiable brand, with a colorful silk scarf instead of the pearls she wore in 2012.

Meanwhile property developer Evergrande’s chairman Xi Jiayun, who is worth $5.9 billion according to Forbes (and who is known to his company’s Hong Kong shareholders by his Cantonese name Hui Ka Yan) arrived at a meeting wearing a belt by cheap Chinese brand Septwolves. Last year, he was snapped sporting a much pricier Hermes belt.

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