And Finally

Upwardly immobile

Why China’s wealthiest villagers cannot afford to leave home

Upwardly immobile

Home to China's richest village people

Locals describe the village of Huaxi as China’s socialist Disneyland.

The per capita income is seven times the national average. And its 60,000 residents enjoy health insurance, pensions and two-car garages.

Every year, the town – located in rural Jiangsu province about 85 miles up a dusty highway from Shanghai – welcomes 2 million visitors, most of whom are Communist Party officials on state-sponsored tours hoping to learn the secrets to Huaxi’s success.

The truth about Huaxi is somewhat Darwinian. While the rest of the country was still debating economic reform, Huaxi dispensed with the hot air and converted its farmlands into factories. As a result, it was first into China’s nascent economic boom, and avoided too much early competition. In the 1990s, it became the first commune in China to list shares on a stock exchange.

The strategy has paid off, turning its residents – all still officially registered as peasants – into wealthy individuals. By 2003, when annual average urban disposable income had reached $1,025 (the rural average was a mere $317) Huaxi’s peasants were already receiving $8,000 a year in bonuses alone.

“Huaxi is a small place. If all we did was farm, at best we’d just be able to feed and clothe ourselves,” says Wu Xie’en, the party secretary. “We wouldn’t be able to get rich.”

But then again, not everything is quite as agreeable as it sounds.

While its residents are nominally richer than any other community, they have less time and freedom to spend their money. Bars and restaurants close before 10pm so that workers do not oversleep. Holidays are scarce.

Villagers also get little cash from their paper assets. Residents must put 95% of their dividends and 80% of their bonuses back into the village. And if they leave, their paper wealth disappears. It’s not exactly the capitalism taught at Harvard.

“Our assets belong to the commune not to the individual,” says Sun Haiyan, a member of the local government. “We have a local saying that your dividend lasts only as long as you stay in the village and the factories keep running.”

Those factories mostly churn out textiles and steel.

But there are some signs of conspicious consumption. To show off its wealth, Huaxi is erecting a complex of three 72-storey towers that are linked by bridges and topped by a giant, disco ball-inspired sphere. The 300-metre high building will be surrounded by a moat and will house several hundred apartments, a luxury hotel, a revolving restaurant, a gym, and a tanning salon.

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