The cost of living a life of luxury in Shanghai continued to outpace inflation in the past 12 months, Swiss private banking group Julius Baer said in a wealth report yesterday.
It said the cost of many luxury goods and services in Shanghai was above average for Asia, driven partly by taxes of up to 30 percent.
This was encouraging the city's wealthy to shop in Hong Kong and Europe among other places instead of at home, the report said.
The survey of 20 goods and services found that prices rose 8 percent in Asian cities in the 12 months from April last year.
Excluding property, where Shanghai's prices fell 4 percent compared with the previous 12 months, the city saw prices rise by around 10 percent in the other 19 categories.
Items that were the most expensive in Shanghai compared with 10 other Asian cities in the survey were watches, handbags, wine, shoes, beauty treatments and hospital stays.
The report said the top price paid for a watch in Shanghai during the survey period was US$42,204 but gave no further details. The average price of all luxury watches bought in the 11 cities was US$19,414.
Botox treatment at international standard hospitals cost more than US$1,300 in Shanghai, a third more expensive than in the next highest cost location, Hong Kong.
The survey also covered Singapore, Mumbai, Manila, Jakarta, Kuala Lumpur, Seoul, Taipei, Bangkok and Tokyo.
The group forecast that by 2015 China's mainland will be home to almost 1.4 million high net worth individuals having investable finance in excess of US$1 million, representing a wealth stock of US$8.7 trillion.
Property prices, economic growth rates, equity market showing and the exchange rate will all affect the growth in the number of wealthy people in China, it said.
A rising yuan will "create more wealthy individuals in China than anywhere else in the emerging markets," Stefan Hofer, emerging markets economist of Julius Baer, said in Shanghai.
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