How China Is Changing The Balance Of Power In The Art World

On 12/03/2014 by Site Default

Market headlines about whether China is number one, two or three in global auction sales may only be the tip of the iceberg of what is in the making. Looking at its auction houses, private museums and collectors, one may picture a very different landscape in the art world in the not too distant future.

Last week, Poly Culture Group Corporation, part of the $61 billion state-run empire Poly Group, and owner of Beijing Poly International Auction, the world’s third largest auction house, announced that it is filing for an initial public offering. The news did not provoke much fuss in the West, perhaps due to the modest size of the IPO ($330 million), but it is indicative of its ambitions to grow global and should not be ignored.

An auction room a Beijing-based Poly Auction Group

An auction room of Beijing-based Poly Auction Group

Even more interesting is what its Chief Executive Jiang Yingchun said during the press conference: “We are big in the art auction market in mainland China but we still have a long way to go to become the biggest auction house worldwide.” A modest statement that some could actually read as the proof of its goal to become largest auction house in the world. With nearly $1 billion in sales in 2012, Poly is still far away from Christie’s or Sotheby’s, but it was only launched 8 years ago, compared to the Western houses’ 250 year history. One could argue it might be only a question of time until we see an auction of Poly or Guardian (another Chinese auction house), in New York or London.

Looking at the rise of private museums in China is also quite telling. In 2012, about one museum per day was opened in China. In 2013, the number rose to 451, and 2014 looks set for another new record. China’s goal was to have 3,500 museums by 2015. It now has about 4,000.

Number of museums and visitors per country in 2013

Number of museums and visitors per country in 2013

Realistically, many won’t survive, and most will be  showing only local art. However, what has emerged recently is that some will focus on Western art, and with ample funds to support it. One example is the Yuan Museum of Chinese artist and super star Zeng Fanzhi, which is aiming to focus on the “pedagogical presentation of Western art.”

With public funding for art institutions in the West decreasing, the number of art patrons diminishing (especially in Europe), Chinese museums have a card to play. These new institutions will not challenge the giants of the West, such as the MoMA, Tate Modern or Pompidou, but they will help to pin China as a global cultural hub. It might not be unrealistic to have to go to Beijing or Shanghai to view a Bacon or Picasso show. As the museum industry is undergoing systemic changes, if China plays it right, it will have a powerful seat at the table.

Finally, the fact that Chinese collectors, known for mostly collecting Chinese art, are beginning to buy important Western artworks is noteworthy. If we make a parallel with the auction houses exponential growth, it would not be a stretch to say that they may soon become major players in that field, too. In recent auctions, Chinese collectors have been buying works from Rembrandt Van Gogh, Monet and Picasso. Some, such as Guo Qingxiang, the art advisor of China’s richest man Wang Jianlin, even believe that “prices in the Western art market are relatively inexpensive now, so it is a good buying opportunity.” This might sound astonishing in the light of the recent record auction results, but it is an important statement.

Wang Jianlin, China's richest man, who recently purchased a $28m Picasso at auction

Wang Jianlin, China’s richest man, who recently purchased a $28m Picasso at auction

With the number of billionaires on the rise in China (358 compared with 481 in the U.S.), and an increasing number of them looking at art, it might mean that they will have a much more important role in setting prices, along with the usual Western art moguls.

Looking at how quickly China’s place in the art market has grown over the past decade, one should not expect that we have seen it all. China is now in a second phase of shaping its position in the art market world. Its increasing power may well come from a variety of subtle changes, and not only by the sheer power of auction sales number. This should not be seen as a surprise, given China’s 5,000 year rich history, nor should it be necessarily considered as a threat. It is a challenge the traditional players in the art world will have to address, in order to discover what is underneath the tip of the iceberg.

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