Art sales soar despite regional economic downturn
With 2018 revenues the highest in the company’s history, Christie’s, the world’s largest auction house, can be considered an authority in the international arts scene. Looking at the Gulf region and wider Arab world during the recent Dubai Art Week and Sharjah Biennial, sales figure across the spectrum, from the large auction houses to small galleries, serve as a good barometer of the regional economy. During a pronounced downturn amid geopolitical instability, modest oil prices and cuts in consumer spending, the art market has held up particularly well.
Economic recovery across the Middle East and North Africa is set to slow in 2019 and growth is likely to be weaker than most expect. Tighter fiscal policies and oil output cuts, as opposed to low oil prices, are set to be the key reasons for economic growth to weaken.
In Saudi Arabia, the Arab world’s largest economy, fiscal restraint and marked uncertainty has led consumers to rethink luxury purchases, especially within the context of a higher cost of living. Following the impact of VAT introductions elsewhere in the region, Oman and Kuwait have postponed theirs, no doubt concerned with its impact on the ease of doing business and living costs.
Despite this reality, the art market has seen marked expansion. Having thrived during the initial boom of the 2000s, then having weathered a slide in profits during 2011-2012, international auction houses have now consolidated their presence in the UAE and are establishing themselves elsewhere. In actively courting millennial buyers, Dubai also serves as a perfect hub for Sotheby’s, which is increasingly looking east, registering $1 billion in sales in Hong Kong alone last year.
This year, Art Dubai brought together 500 artists and 50 museum representatives from 80 countries to deliver a renewed message of culture and creativity. After 13 years of the event, it has become an important international art fair attracting thousands of visitors. Giving local artists an opportunity to interact with the international art market, as well as acting as a portal for international artists and collectors into the regional market, Art Dubai is central to regional efforts to grow economies of knowledge. The week of festivities attracts buyers not only from the Gulf, but also increasingly from China, India and Russia.
Much as it was Christie’s move to Dubai, and thereby its commitment to the region, that put the emirate on the international art map, the much-anticipated sales during Dubai Art Week are the festival’s great centerpieces. Since their arrival, the large auction houses have been breaking records. Dubai Art Week’s annual watch sales have made the UAE a target market for horologists. Given the marked public relations efforts of the organizers of Art Dubai to embark on a curatorial charm offensive, the event gave regional collectors an opportunity to buy pieces from as far afield as Latin America and the Far East.
The success of the growing contemporary Middle Eastern art market is indicative of a positive trend from the perspective of expression and freedom of intellectual thought.
The growth of the contemporary art market has been greatly supported by such events, which provide a platform for up-and-coming international artists to exhibit. According to Michael Jeha, Christie’s long-term managing director and now regional chairman, “we’re seeing appetite increase for contemporary art (and) Islamic art from the region.” The growing success of Dubai Art Week is synonymous with the growth of the wider art market regionally.
Despite a clear focus on cultivating young artists, the week still retains a certain glamor associated with Dubai. Last year, the region’s biggest ever watch sale result was generated when a rare Patek Philippe Ref. 2499/100 sold for $499,500. Last Friday, in a nod to the growth of regional collectors keen to own their heritage, an incredibly rare white gold Patek Philippe watch once owned by former Libyan strongman Muammar Qaddafi sold for $193,750, a 675 percent premium on the asking price. Grossing $8.25 million, the watch sale was illustrative of the glamor and unyielding centrality that the international auction houses bring to Art Dubai.
With the region in a sense of tumult, the success of the growing contemporary Middle Eastern art market is indicative of a positive trend from the perspective of expression and freedom of intellectual thought.
The most eagerly anticipated lots in Saturday’s art sale were by artists from Lebanon, Egypt, Syria and Iran. The prominence of lots by Fateh Moudarres and Marwan Kassab-Bachi, for example, serve as important exposure for the creative talents of Syria and its people at a time when the country dominates headlines due to more troublesome news and developments. An important point in the context of the regional art market, Dubai and the wider UAE has again been able to nurture cultural appreciation and creativity amid civil conflict elsewhere in the region.
In Sharjah, whose ruler has actively supported the arts scene from the perspective of tolerance and cross-civilization dialogue, the growing attraction of the biennial has put the emirate on the map for visitors to Art Dubai.
For Jeha, the Christie’s sale in Dubai “was encouraging as, despite the regional challenges, the art market has held up particularly well, attracting bidders from 36 countries, who set 12 new world auction records.”
Just as when the auction houses and galleries initially invested in the region, nurturing new and young collectors remains central to their efforts. An impressive 18 percent of all bidders were new to Christie’s and nearly 70 lots, a quarter of the total, experienced online activity. Much as Sotheby’s has targeted the millennials market, Christie’s has embraced online promotion and sales as a means to attract younger audiences.
The 2019 edition of Art Dubai was a welcome source of positivity amidst the signs of a more challenging political and economic environment in the Middle East. Going forward, how other regional destinations grow as art markets, and indeed as environments for young artists to succeed, will be of great interest to the world’s major auction houses as they seek new opportunities.
- Zaid M. Belbagi is a political commentator, and an adviser to private clients between London and the Gulf Cooperation Council (GCC).