Hungry for Luxury; But Chinese consumers prefer Western brands.(Interview)

Byline: Dana Thomas

Ten years ago David Tang launched Shanghai Tang, a designer brand that specializes in chic Chinese-style dresses and suits. Two years ago the Paris-based luxury group Richemont, which owns Cartier, Dunhill and Montblanc, bought a controlling share of the firm and has expanded its retail network. Tang, who also owns the colonial-style, members-only China Club in Beijing and Hong Kong, now sits on the board of Shanghai Tang. He met with NEWSWEEK's Dana Thomas in his kitsch-filled Hong Kong office to talk about luxury in China. Excerpts:

THOMAS: Why are the Chinese so hungry for luxury goods?

TANG: The opening by Deng Xiaoping [to capitalism] created for the first time in 100 years a rising middle class, and this creates the competitive nature to be better than your neighbor. Ten or 15 years ago there were no dinner parties, no balls to go to, no events to wear a Prada shirt or a pair of Tiffany earrings to. Now this exists.

But why Western goods?

There is a saying in Chinese that something is particularly good when it has been soaked in foreign waters. The Chinese also have a slight complex that they are behind. They regard Western goods as having a superior standard--a certain cachet--and, of course, they are more difficult to get.

Aren't some Western luxury brands actually made in China?