CHINA - not since Japan captured the imagination and lust of international luxury labels has there been a country that comes close to matching or even overtaking its appetite for branded goods.

Ever since Louis Vuitton opened its first store in Beijing in 1992 (it now has 30 stores throughout the country), it and other brands that have followed suit can safely say that China is the new retail frontier.

As the world's second largest consumer of luxury goods after Japan, China accounts for some 30 per cent of branded sales worldwide. With newly minted billionaires being created and a burgeoning middle class, it's a no-brainer that China (and the rest of Asia) is seen as the saviour of European brands getting a battering from their own lacklustre economies back home.

Its new importance also brings with it a change in marketing strategy on the brands' part. The Chinese market has developed to the point where fashion labels are now designing and marketing their products targeting the Chinese specifically, just like they did with the Japanese market in the 1980s (special designs only available in Japan, for example).

But forget about idealistic notions of old, where a romanticised China is visualised through the heavily-embellished 'Oriental' creations of couturiers from Paul Poirot to Yves Saint Laurent.

The new wave of designs is more pragmatic, tailored to sell rather than inspire, and its target audience plainly indicated through the involvement of Chinese craftsmen and personalities. Still, regardless of motivation, this much is true - China is once again the centre of fashion's universe. Let's see who's jumping on the bandwagon.

HERMES

The quintessentially French luxury house - sporting a made-in-China label on its products? That's right, but not in the way that you might think. In a bold industry move, Hermes has bought a majority share in newly created lifestyle company Shang Xia, which will design, manufacture and sell top-quality ready-to-wear and decorative arts that are inspired by - and crafted in - China. Its creative director is well-known artist Jiang Qiong-Er, daughter of noted Chinese architect Dong Dayou, who designed the Shanghai Museum.

It's an unusual move by the French house, which usually only buys into existing brands, but one that will allow Hermes to offer cheaper products as well as capitalise on the growth of the luxury market in the country in 2010.

Patrick Thomas, president of Hermes International, says that Shang Xia will be tailored for the Chinese market where Hermes lags behind its competitors. 'Shang Xia will be an authentic fashion house, with a style, material and know-how that is anchored in Chinese culture,' he says.

The new brand will open its first store later this month in Shanghai. A second Shang Xia store will open in Paris at the end of the year.

Translated as topsy-turvy in Mandarin, Shang Xia could refer to the bottom-up model of this new venture, or be an ironic reference to the new power balance of the world economy where the traditional Western leadership is now in decline. Whichever it is, all eyes will be on Shang Xia to see if it blazes a trail for others to follow.

CHANEL

The double Cs in Chanel's logo could very well have stood for a Chanel-China partnership in December. That's when Karl Lagerfeld unveiled Chanel's demi-couture Maison d'Art collection in Shanghai for the first time. The annual travelling show is an homage to the seven specialist workshops that run the luxury house's atelier, such as its accessories manufacturer Desrues, plumassiers Lemarie and embroidery specialists Lesage.

Themed Paris-Shanghai, the collection was shown on an 85-metre-long barge on the Huangpu river, along Shanghai's famous Bund. A veritable terracotta army of models - many of them Chinese - wore museum-worthy looks inspired by China's decadent 1930s: think Qing court apparel, pagodas and rich, jewel-tone embroideries from the Beijing Opera era.

The whole shebang was a nod to the significance of the growing China market, and was inspired by Coco Chanel's passion for Oriental art and antiques. (She famously used Chinese lacquered screens as wallpaper in her Rue Cambon home in Paris.) It also marked the first time a major luxury brand had organised an international launch in the country - Fendi had staged a fashion spectacular at the Great Wall of China in October 2007, but the looks that were showcased had already been unveiled in Milan a month before - and it thus elevated Shanghai's status as a fashion hub.

PRADA

The Chinese now literally have a starring role in Prada's world. Last month, the Italian label launched a nine-minute black-and-white film called First Spring to promote its Spring/Summer 2010 collection. Directed by Chinese artist Yang Fudong, the film was shot in the French colonial quarter of Shanghai and featured Chinese models against a surreal Chinese landscape - a stylised commentary on East-West encounters throughout Chinese history.

Not only was the film directed by a Chinese artist, but the central characters are a Chinese couple. The Oriental focus continues this month in Prada's international print ads for its men's collection, which feature Chinese models - a first for this influential Milanese house.

MENSWEAR DESIGNERS

No longer is Chinese dress merely represented by mandarin collars and Mao jackets - this season's men's collections demonstrated an incisive appreciation of Chinese style, where leading labels showed Chinese-inflected designs that went beyond the obvious.

From fashion master John Galliano, for instance, there were glossy satins in Chinese court official hues. Meanwhile, at normally-edgy Dior Homme, Kris Van Assche showed softly draped coats, coolie trousers and elongated tunics that closed in the traditional Chinese style. And even avant garde Californian Rick Owens proved that he could do chic Chinese, turning out ensembles with elongated lines that gave the models something of a Ming scholar look.

RUNWAY SHOWS

It may be that the international success which supermodel Du Juan has had has encouraged more Chinese models to move into the global sphere, but there's no doubt they're wanted there.

Last month, for example, Shanghainese Shu Pei and Hunan native Liu Wen (who last year became the first Asian model ever to take part in the Victoria's Secret show) stormed the Spring Summer 2010 haute couture catwalks, while in December Emma Pei walked the Chanel runway in its pre-fall 2010 collection.

In fashion's front row too, a change is taking place, as the Financial Times reported recently. The Russians, formerly front-row fixtures, have faded into the background (or into the seats some rows back), to be replaced by the even more liberal-spending Chinese.

Will the 2010s be China's decade in fashion then? Who knows, but the fortune-tellers are probably betting on it.

btnews@sph.com.sg

Additional reporting by Audrey Phoon aphoon@sph.com.sg

This article was first published in The Business Times.