Two new luxury malls have opened in Shenzhen, a city that wants to rival Hong Kong in its luxury spending.
The Mix C mall and Wongtee Plaza are just a taste of what’s to come. Another 10 malls are expected to open in the city over the next two years. Though the new shopping centers aren’t exactly booming with activity as of yet, they may still gain considerable traction among affluent Shenzhen shoppers.
“The Field of Dreams philosophy – if you build it they will come – seems pertinent in China in ways that often do not make traditional sense,” says Clifford Coonan, Beijing correspondent for the Irish Times, “but having seen this happen on numerous occasions in Beijing, I wouldn’t be surprised if these malls are soon hopping.”
The new properties may help address a key imbalance among China’s major cities — Shenzhen has only a third of the number of luxury goods stores that Beijing and Shanghai have, and just 10 percent of what Hong Kong offers. Shenzhen’s luxury offerings have also been curtailed by the Chinese government’s recent crackdown on corruption, leading many shoppers to cross the border and spend their money in tax-free Hong Kong.
Though China’s economic prospects for the rest of the year remain uncertain, financial services company Barclays believes that the government will focus on reforms for the remainder of 2014, including “budget/tax reforms, Hukou reform, SOE reforms, capital account opening (QFII and RQFII quota expansion, the Shanghai-Hong Kong Stock Connect) and exchange rate reform, and further financial market liberalization and regulations on internet finance and shadow banking.”
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