When the Hurun Report was launched in 1999, it had just one US dollar billionaire. And only just: “red capitalist” Rong Yiren, the former China vice-president who founded the sprawling, state-controlled CITIC conglomerate, topped the list with an estimated wealth of $1 billion.
This year’s Hurun list, which tracks China’s high-net worth individuals, was released in September. It revealed that there are now 189 US dollar billionaires. Occupying the top spot with $12 billion in assets is 65 year-old Zong Qinghou, the chairman of China’s leading beverage company Hangzhou Wahaha, which supplies the country with bottled water, fruit juice and milk-tea (see WiC29).
The number of billionaires is definitely understated too. “You can safely say that we have missed at least the same again, meaning there are between 400 and 500 US dollar billionaires today,” says Rupert Hoogewerf, Hurun’s founder.
Why is it so hard to track China’s richest people? For a start, more than a few fortunes have been built in grey areas. Other tycoons prefer to stay in the shadows to avoid paying taxes. The China Reform Foundation, an economic research group based in Beijing, estimated that about $870 billion in corrupt “grey money” was being hidden by the wealthiest 10% of China’s population.
Many of the country’s super-rich are also worried that they might suffer the same fate as Huang Guangyu, a former number one on Hurun. Huang, the founder of electronics giant Gome, is now in prison, convicted of stock fraud and insider trading (WiC36). Being known as China’s ‘richest person’ carries potential risks, such as unwelcome scrutiny.
But a look at this year’s Hurun list at least sheds new light on the evolution of China’s economy. Contrary to previous years, property is no longer the biggest creator of wealth. It is the first time in 10 years a property tycoon has not made the top five, says China Entrepreneur. After recent government attempts to cool off the housing market only two are left in the top 10 (thanks to sagging property share prices).
Instead, many of China’s richest tycoons prospered on the backs of domestic consumers, including fifth richest Yan Bin, who owns the rights to energy drink Red Bull in China (WiC55). Number two on the list is Shenzhen Hepalink Pharmaceutical’s Li Li and his family, which listed earlier this year (WiC59).
The rise of tycoons like Zong and Yan to the top of the list underlines the strength of some Chinese consumer goods brands.
But last year’s number one, Wang Chuanfu – chairman of the electric car company BYD – fell to number 12 this year. Perhaps it’s no coincidence as BYD has recently had to cut its sales forecast for this year. Delays in production of electric cars have also led to market concerns that it could be years before BYD’s green technology makes a big contribution to profits.
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