Date
24 March 2017
Chinese shoppers take advantage of the weak sterling to  snap up luxury items in London. Photo: Reuters
Chinese shoppers take advantage of the weak sterling to snap up luxury items in London. Photo: Reuters

Weak sterling draws luxury shoppers to Britain

Britain is now the cheapest place to buy luxury goods, the Wall Street Journal reports, citing analysts.

Sterling has plunged 17 percent since Britain voted in June to leave the European Union.

That should have raised the prices of most imported items such as wine, electronics and cars.

But most luxury-goods makers have not yet raised their prices, given the huge margins for their products, and that has made Britain the cheapest market for such products, the newspaper said.

That’s good news for shoppers of high-end items, and also for the country’s tourism sector.

Spending by foreigners on items for which they seek tax refunds jumped more than 36 percent in August in the UK, compared with a year ago, the Journal said, citing a UBS analysis of data from Global Blue, a tourism shopping tax refund company. Most of such items are luxury goods.

By comparison, similar purchases fell nearly 20 percent during the period in France, where tourism has been affected by a series of terror attacks, and more than 11 percent in Italy.

Chinese shoppers, in particular, have flocked to Europe to take advantage of the weaker euro and avoid Chinese import duties, the newspaper said.

Many of their purchases end up in the hands of middlemen who resell them at prices that are much cheaper than in Asia, the report said.

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RA/CG

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