Singapore’s Rich Chinese Cut Back on Ferraris and $75,000 Whisky

• Whisky, high-end condos and golf membership prices are down
• Money laundering crackdown has led to more discreet spending

In Singapore’s boomtime, whisky dealer Manjit Gill used to sell at least a bottle every day to his wealthy Chinese customers, who occasionally splurged as much as S$100,000 ($75,000) in one go on single malt.

These days, three sales a week to them counts as a good run. Gone too are the most outlandish purchases. “They’re not in a relaxed mood,” Gill, whose company operates The Whisky Distillery chain of retail stores, said of his mainland Chinese clientele. “When they come, they’re in a rush.”

Manjit GillSource: The Whisky Trust Group

The new reality is typical for dealers to Asia’s ultra-rich in the financial hub, which is now suffering a hangover after the heady days of spending during the pandemic. At that time the big spenders — primarily Chinese tycoons — flocked to the country, helping to turn Singapore into the world’s most expensive city for luxury goods.

Lately, demand has ebbed. Prices for high-end condominiums have declined since September, while sales of flashy cars like Bentleys and Ferraris have plunged. Big-ticket items from golf memberships to 30-year-old whiskys have also suffered price declines.

A myriad of factors have led to this, from high interest rates to tax hikes targeting foreign wealth. But increasingly, observers point to another reason: the rich are embracing more low-profile spending to avoid the attention that displays of opulence might attract. This comes after a major crackdown on money laundering in Singapore, and as resentment stirs among the local populace about rising costs of living.

“The Chinese are not buying the way they used to,” said Amrita Banta, managing director at Agility Research & Strategy, a luxury consulting firm. “There’s a broad cloud impacting the ways they spend money in Singapore,” she added, pointing to the recent S$3 billion laundering scandal and the impact of China’s weakened economy.

Over the past 12 months, wealthy individuals in Singapore seem to be favoring discreet over more overt expressions of wealth & Luxury, according to a report by Julius Baer Group Ltd that was released in late June. The Swiss wealth manager said sales of watches, cars, apartments and other goods have dropped, even as the city continues to outrank London, New York and Hong Kong as the world’s most expensive for luxury spending.

People taking a photo outside a luxury store along Singapore’s Orchard Road.Photographer: Ore Huiying/Bloomberg

“Singapore’s Rich Chinese Cut Back on Ferraris and $75,000 Whisky” courtesy of Bernadette Toh and Low De Wei from Bloomberg (July 19, 2024). © 2024 Bloomberg. All rights reserved.