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Hong Kong at the Center of Asia's Burgeoning Art Market


Hong Kong has become one of the world's leading art markets, where sales of Asian art have surged in recent years. The entry of newly wealthy Chinese art collectors has pushed up prices.

Precious Chinese ceramics were up for grabs at famed auction house Sotheby's recent spring sales in Hong Kong.

The four-day auction of art, watches, jewels and ceramics brought in more than $108 million, exceeding the auction house's expectations.

Sotheby's reported its highest ever sale total for Chinese contemporary art - nearly $17 million. A painting by the artist San Yu went for $3.6 million to a private collector. It was more than five times the asking price and the highest amount ever paid for a Chinese oil painting.

Sales at Asian art auctions of both Sotheby's and rival house Christie's in Hong Kong have surged dramatically in the past two years, cementing the city's place as one of the world's most important international art markets.

Henry Howard-Sneyd, Sotheby's director for Asia and Australasia, says many factors make Hong Kong attractive for both art buyers and sellers. These include the city's infrastructure, its developed legal and financial system and easy import-export regulations that give it a competitive advantage over other Asian cities. He says another major factor is Hong Kong's geographic position in the heart of Asia.

"It is extremely well positioned and the art market has grown to a stage where we turn over a quarter of a billion dollars a year in Asia - so that's really beginning to be a very significant part of the international art market," he said.

Johnson Chang, director of Hong Kong's Hanart Gallery, says one of the reasons the city's art market is booming is the increasing number of newly wealthy mainland Chinese who have started to buy art. They are competing with buyers from more mature art buying markets like Taiwan and Hong Kong.

"The collecting frenzy in China is very new, they are a very, very strong force and collectors from mainland China have been pushing up prices," he said.

Chang says that while some Chinese regard art mainly as an investment or as a status symbol, many are genuine collectors.

"They are people who want to buy back their own history, especially art from the last 20 years that has slipped out of China because nobody was interested in it, people did not consider them important at the time or simply they could just not afford it at the time," he said.

Many Chinese buyers come to Hong Kong to buy items they cannot find in the mainland. On this day one man from Beijing is bidding for ceramics at Sotheby's auction. He says the quality of the Chinese porcelain Sotheby's is selling is high and that there is not as much variety available in Beijing.

The majority of the art sold at Asian art auctions in Hong Kong is from China. Sotheby's Howard-Sneyd says most of the bidders for traditional Chinese works - mainly the so-called ink and wash scroll paintings - are Chinese or ethnic Chinese from the region. The market for contemporary Chinese art, by contrast, is much more international, with buyers from around the world.

Jimmy Lam manages the Connoisseur gallery in Hong Kong. He says while the market for modern art from China is still relatively new, both the interest of buyers and prices has surged enormously in the past few years.

"I think in the past five to six [years], it's been this huge bubble that people kind of like look at it and say," he said. "Oh, it's an interesting, a new market in terms of Chinese contemporary art' and so people try to find out more about it to figure out - what is this new market we should get hold of, I guess."

The demand for contemporary art from China and other Asian countries has exploded not only in - but also outside the region in recent years.

After three successful contemporary art sales in Hong Kong, Sotheby's held its first U.S. auction for modern Asian art in New York in March, bringing in $13 million.

Sotheby's Howard-Sneyd says it was a landmark event.

"It was the first time anyone has organized a sale of contemporary Chinese art in New York and it caused considerable interest and excitement, and really it was one of those celebratory sales where you just feel this tremendous atmosphere and excitement," he said.

Because of the growing interest from Western collectors, Sotheby's has established a contemporary Asian art department at its office in New York.