The Kleptocrat in Apartment B

On a recent trip to Geneva, I was chatting with a local resident when he told me that the watch industry has been suffering. Sales of Swiss watches were down, he said, and he offered a fascinating explanation: over the last few years, the government of China has instituted a broad crackdown on official corruption—and particularly on the giving, or receiving, of extravagant gifts. As a case study in the butterfly effect of international graft, it seemed almost too neat to believe. But it’s true. In fact, the whole luxury sector was affected by the regulations, from designer handbags to high-end spirits. Last year, when consultants from Deloitte surveyed Swiss watch executives, eighty per cent of them indicated that demand was down “due to anti-corruption legislation” in China.