China’s parvenu
The Financial Times reported on July 8th that China’s booming economy in the past two decades has produced a prosperous private wealth and a new class of super-rich. This point is evident in the changes appeared in Hurun Report’s rich list, the minimum requirement rose from $6 million nine years ago to $100 million last year. Besides, the number of dollar billionaires has increased dramatically, from 7 in 2004 to 105 in 2007. And Rupert Hoogewerf, editor of the Hurun Report, said that the country’s parvenu have gone through the initial stage of securing their family’s financial independence and have established relationships with the government and paid their taxes.
On another report, a 2008 world wealth report by Merrill Lynch and Capgemini, 415,000 people who have $1 million in disposable assets are listed, which makes China home to more millionaires than any other country in the world. In a list compiled by Forbes 66 Chinese billionaires are shown. Below the super-rich level is the rapidly expanding class of millionaires.
The growth of private fortune is attributable to three factors, according to The Financial Times: First, “a surge in entrepreneurship in the past two decades has produced a generation of successful private companies”. Lots of these business people and their companies have achieved success and become industry leaders. Second, “the boom in the mainland stock market”. Share prices multiplied in last two years, and a number of entrepreneurs took the golden chance to list their companies and seen their net worth increase dramatically. Third, “the hot property market in many larger cities, which has expanded the net wealth of the country’s rich, many of whom have a significant share of their investments in the real estate sector”.
Another change happens upon the Chinese rich is that more and more them become members of CPC. “At this year’s annual meetings of the National People’s Congress, the legislature, and the China People’s Political Consultative Conference, an advisory body, there were about 80 delegates from the 2007 rich list,” the newspaper reported.
But the average annual incomes in China’s countryside are less than 4,000 yuan, which means a growing wealth gap. Based on this the Chinese government has substantially increased social spending in rural areas, the newspaper reported.
Popularity: 4%