Chinese shoppers on their Lunar NewYear holiday were less lavish than expected by Hong Kong jewelers, curbed spending on beauty brands and slowed spendingat South Korean stores. According to a recent Bloomberg article, the slower pace in 2012 may mean trouble for the growing number of foreigncompanies rushing into China, especially luxury brands. 

A retail analyst in Shanghai said:

“This year is going to be tough, probably the toughestyear for many foreign luxury brands since they entered intoChina. Sales of jewelry and valuable watches during Chinese NewYear were quite disappointing. Sales growth ofover 30 percent last year is unsustainable against a worseningmacro-economic backdrop.” 
Hong Kong jewelry sales director Dennis Lau blamed the West:
“We can’t see how strong the recovery in the U.S. is, andthe debt crisis in Europe never seems to end. Ifthose economies mess things again, it could severely hurt globalconsumer confidence.” 
A cosmetics store salesman said:
“People are browsing… last year customers were grabbingeverything.”
Hong Kong Retail Management Association expects Hong Kong retail salesgrowth to slow to 15 percent this year from 25 percent in 2011.


“The sales of jewelry and valuable watches are goodindicators of how strong the Chinese tourists’ purchasing poweris. We expect some Chinese shoppers to cut back on big-ticketitems as the wealth effect fades.” 
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