Chinese tourists stand near the Big Ben clock tower in London, Britain June 29, 2016. REUTERS/Kevin Coombs
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By voting to leave the European Union, Britons have delivered a potential windfall to tourists eager to snatch up Burberry trenchcoats, Harrods Stilton and Liberty scarves on the cheap.A slumping pound is a much-needed shot in the arm for U.K. luxury companies as the Chinese are the biggest buyers of high-end goods and make most of their purchases overseas. They made 270,000 trips to the U.K. last year, up 46 percent, according to tourism website VisitBritain. British Airways owner IAG SA said Tuesday that the weaker pound will boost tourist flows to the U.K.The U.K. is the world's sixth-largest market for luxury spending, at 15.5 billion euros ($17.2 billion).Some luxury companies may also raise U.K. prices if the pound's weakness persists.Still, a 10 percent drop in sterling could add as much as 90 million pounds to Burberry's pretax earnings, according to MainFirst Bank AG analyst John Guy. Burberry gets about 10 percent of its revenue in the U.K., and 60 percent of that comes from tourists, Citigroup analyst Thomas Chauvet estimates.
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