This week, Art Basel and UBS released the Art Market Report 2024, an annual global art market analysis. Written by expert cultural economist Dr. Clare McAndrew McAndrew, the report examines and presents the trends and developments of the international market in 2023. From an analysis of sales and activities of galleries, auction houses, collectors, and more, this annual report provides a rare glimpse into an often secretive industry for the public, law enforcement, and governments.
The report includes data gathered from art market actors and experts, via surveys of dealers and auction houses, and information from industry data-trackers such as Artory, artfairmag.com, and NFT18.com. Given that a portion of the data comes from voluntary surveys, the figures reported are just the tip of the iceberg. Despite this, it remains the most comprehensive dataset available for further analysis.
As in years past, the United States remains the largest art market in the world, making up 42% of the global total in 2023 at $27.2 billion. The next largest market, China, does not even account for half of the U.S. market, coming in at 19% of the global total. As a result, U.S. law and policy that affects the American art market disproportionately impacts the entire global industry.
While regional market makeup remained the same in 2023, the industry landscape was evolving in other ways, as governments struggled to find a balance between the art market’s traditional culture of discretion and the global push for regulation and transparency in every other sector of comparable size. The need for action has been further emphasized by a growing number of case studies from law enforcement, governments, and journalists into money laundering, sanctions evasion, and terrorist financing. While these cases may currently be small in number, they are not small in impact. The Rotenberg brothers, some of Putin’s closest allies, were able to purchase more than $18 million works of art in the U.S., while American institutions were banned from doing business with them. Additionally, Nazem Ahmad, a known Hezbollah financier, used art and other luxury goods to transact at least $160 million through the U.S. financial system.
The report covers actions taken by other large regional markets (the UK, the EU, and China) to have their art markets fall within the relevant anti-money laundering (AML) regime, and highlights how “enforcement of stricter AML regulations is likely to make the Chinese art market a safer place to transact in the future and support greater involvement by collectors.” As all other regional markets enforce regulations, the U.S. market becomes more vulnerable to exploitation from criminals if policy makers do not take action.
Regarding antiquities, the report makes clear that the landscape is also changing. Dealers in antiquities and decorative art had among the lowest average turnovers, with the antiquities sector reporting an average 4% decline in sales. The report acknowledges that the sector “has faced many challenges, with limited supply as well as what some described as a ‘shrinking base of buyers’ every year and numerous regulatory hurdles related to ownership as well as restrictive trade laws within the sector.”
What the report refers to as “regulatory hurdles related to ownership,” could indicate that buyers are more conscious, concerned, and aware of the need for rigorous provenance to be provided to purchase antiquities. This was emphasized in a recent wealth report, where 87% of collectorsrank provenance and forgery problems as their main concern, showing that collectors are paying attention to looted antiquities scandals making headlines worldwide.
The release of the Art Basel and UBS Art Market Report 2024 sheds light on the complexities and challenges facing the global art market, which is just that – a market. As with any market, it is not immune to the global push for good business practices, due diligence, and integrity of transactions.
An accountable and transparent art market is in everyone’s interest, including the market itself.
Check out the Art Market 2024 here: https://theartmarket.artbasel.com/
