Half of China's millionaires want to leave country

http://business.blogs.cnn.com/2011/11/01/report-half-of-chinas-rich-want-to-leave/

by amitagrawal • 15 years ago

186 104 15 years ago

business.blogs.cnn.com

DamnYuppie• 15 years ago

Hmmm.....I can't disagree with the contents of the post. Yet I think it is a piece written to distract from the issues facing our own nation by doing an implicit juxtaposition between China and the U.S.

I am of the opinion that we should spend less time denigrating others and more time having open and honest discussion AND reporting of the issues facing us here in the U.S. Pointing out issues and flaws in others in now way helps fix the flaws in ourselves.

latch• 15 years ago

CNN is just reporting on a paper published by the Hurun Research Institute and the Bank of China. That isn't "denigrating" anything, it's reporting a story, which given the source (not CNN, but Bank of China) is probably pretty factual.

pferde• 15 years ago

Yes, because everything is about USA, and every story from abroad is just a spin piece to manipulate public opinion of its citizens. \rolls eyes\

By the way, you are free to do your own research and publish a story about number of U.S. amount of rich people wanting to emigrate.

marquis• 15 years ago

This is a global site, not a U.S. forum.

tnuc• 15 years ago

It doesn't always appear that way.

_yobq• 15 years ago

Atlas wants to shrug.

espeed3• 15 years ago

This summer Forbes reported...

"China Daily reported Friday that unnatural deaths have taken the lives of 72 mainland billionaires over the past eight years. (Do the math.) Which means that if you’re one of China’s 115 current billionaires, as listed on the 2011 Forbes Billionaires List, you should be more than a little nervous." (http://www.forbes.com/sites/raykwong/2011/07/25/friends-dont...).

I wonder how much fear is playing into this desire for exodus.

folkster2• 15 years ago

This news is far from being accurate. http://news.ycombinator.com/item?id=2806250

espeed3• 15 years ago

Regardless if its billionaires in yuan or dollars, if there is a sentiment in China that the wealthy are being killed, it could fuel the desire to leave.

berntb• 15 years ago

Is the real problem that lots of party functionaries without much money has power and little oversight? So they can press money out of the local rich, without repercussions?

Or is political uncertainty the real problem -- the political climate next month can be halfway back to the cultural revolution?

Or a third alternative?

Edit: Word choice, for clarity.

nobody31415924• 15 years ago

Welcome to a land where the local rich can press money out of party functionaries!

chaostheory5• 15 years ago

I'm not so sure about that. If that were true, I don't think the local rich would be so eager to join the party membership.

itsnotvalid• 15 years ago

Not just the millionaires but many people want to too.

kissickas• 15 years ago

Can someone enlighten me on how so many (or so few) people got so rich off of property?

pemulis• 15 years ago

Average housing prices in China tripled from 2005 to 2009.

https://en.wikipedia.org/wiki/Chinese_property_bubble

reedlaw• 15 years ago

Speculation in a housing bubble.

nobody31415924• 15 years ago

Not just houses - if you somehow managed to own the 'peoples bicycle factory' on land right next to the port that is now a Foxconn factory you are likely to have done OK out of the deal.

Shivetya• 15 years ago

Party connections.

It is how everything works in a Communist society, everything bends to the party, the people, the land, the environment. The results to each is usually the same.

fugit• 15 years ago

Decisions are made kinda like HN moderation: just bow to the party line.

rue• 15 years ago

For the sake of accuracy, China's had little to do with communism for decades now.

analyst74• 15 years ago

As noted, housing bubble, the bubble was started by lack of investment opportunities when people start to amass wealth in cash, housing is pretty much the default choice. Bond and other safe investment do not yield enough to cover high inflation.

It is then further furled by a combination of speculative investment and local government/bank/construction industry collusion. This is quite similar to what happened to the States in post-2000 housing bubble, but in greater scale due to stronger government control and growing economy.

tomkarlo7• 15 years ago

It's not unique to China. There's a long tradition of powerful families creating wealth from the growth of a city or economy by buying up real estate, promoting the growth of a city, then benefitting from the radical increase in real estate value that results as land transitions from agrarian to urban.

The SF peninsula is an example of this - families that made money in mining bought up land south of the city in the 1800s, then actively worked to promote policies that would lead to growth of the city in that direction.

folkster2• 15 years ago

Money can buy you bigger houses, fancy clothes, new cars. But it can't buy you freedom, in China. That's why the millionaires leave, to be free.

yaix• 15 years ago

It can. If you have money in China, you are much more free than in the West. Because laws only apply to you to a very little extent. You killed five people while speeding drunk? One phone call and problem solved.

The question is not freedom but legal security. Here in China you never know when the goverment will show up and take you money or company away from you.

Tsagadai• 15 years ago

China is quite free compared to most western countries. If you have money you are pretty much free to do as you please as long as you keep your head down. There are two types of crimes in China crimes that get you put away forever or executed and crimes that you just pay the officer for. Every regulation in China is basically a tax, you pay someone and it is solved.

derleth• 15 years ago

That is a kind of freedom, perhaps, but it isn't liberty. China is notoriously short on liberty.

oblat2• 15 years ago

Americans think that everyone whats to be American. It is all part of a narcissism that is crippling the American economy.

AdamFernandez• 15 years ago

This seems to reinforce some points made by Paul Graham in his 'How to Make Wealth' essay. Especially regarding governments not allowing individuals to accumulate wealth. http://paulgraham.com/wealth.html

espeed3• 15 years ago

Or simply having the infrastructure in place to protect the opulent from the criminals.

samtp• 15 years ago

ALL HAIL PAUL GRAHAM!

vph• 15 years ago

This is not necessarily a bad thing for China or a good thing for countries that want these millionaires. I bet after migration many of these millionaires migrate will establish companies that connect with sources inside China for outsourcing. In an economic sense, the millionaires are very much Manchurian candidates.

acangiano• 15 years ago

In Canadian cities like Toronto and Vancouver, you see this very clearly. Many chinese people are technically in Canada, but they never really left their home country. They create a small subcity with its own economy, and huge ties to the homeland. A great deal of them never learn English because they don't have a need for it.

nostromo• 15 years ago

Maybe for one generation, but I have two great friends who are the children of these types, and they are as American as anyone.

el_presidente• 15 years ago

At least in Toronto this doesn't apply only to chinese people. The city is highly segregated, but people ignore it by calling it multicultural.

keyworks2• 15 years ago

Totally agree, in some parts of Toronto, it's probably difficult to get by without knowing some Chinese (pacific mall anyone?). Even here in Waterloo, which is much smaller than Toronto, you see these kinds of "sub cities" and tight networks among the first generation Chinese.

MengYuanLong• 15 years ago

Note that the claimed reason is better education opportunities for their children. There is definitely a perception here in China that connections and schooling are critical for a life of success and wealth.

That said, I have my doubts they would be able to directly ask, "Do you want to emigrate?". So perhaps that is why they tacked on the education bit for plausible deniability (i.e. I love my country but my child should go to Harvard).

oblat2• 15 years ago

Remember the way America plans to compete with China is to wait for China to fail. So there are a lot of Americans straining their eyes for a glimmer of salvation. That is the context for pretty much every American story on China you see.

The reality is that Chinese rich are hedging like all the rich do. Putting 20% of your wealth in a safe investment outside your home country is not unusual. And they are gearing up to send their child overseas to the best schools they can find - just like all the other tiger economies did.

dgallagher• 15 years ago

One quarter of China’s top 1000 richest people obtained their wealth from property, compared to less than 10% among the world’s 1000 richest, the report says.

Are they comparing the top-1000 richest people in China to the top-1000 richest people in the world? That's not a very good comparison. It's like comparing the top-1000 students from a single college, to the top-1000 students from every college in the entire world.

I'm not sure if the actual report makes this comparison too as I cannot read Chinese.

tomkarlo7• 15 years ago

If 1/6 of the students in the world went to that college, it wouldn't be that bad a comparison.

jonhendry• 15 years ago

It makes perfect sense, as many of those who made a fortune in property probably obtained that land through party connections and/or party corruption. How else would they have obtained 'property' in China?

fredliu2• 15 years ago

The trend is definitely true, but it's been there since day one when there began to have "rich Chinese". This CNN post made it sounds like, suddenly the rich Chinese worry about them being killed or end up in jail, because they oppose the chinese government? This is laughable.

“We see too many worried entrepreneurs nowadays who are afraid that they would end up in prison for offending Chinese officials,” You gotta be kidding me, most of the richest Chinese ARE the Chinese officials!! If they do end up in jail, it has much more to do with them accumulating their wealth illegally by abusing their power, than say, publicly posing a middle finger to Mr. Hu.

This article looks like just another typical heavily biased manipulative CNN crap, which throws in some data at first to make it believable, and then hijacked the real reason behind the data, adding their own interpretation. Reading CNN's news on China is just like reading Fox's news on Obama.

yelsgib• 15 years ago

What do you recommend reading to find out more about what's really going on in China/South-East Asia?

fredliu2• 15 years ago

I would recommend first hand observations from western expats (through their blogs probably?) that actually live in china or at least spend reasonable amount of time there. Their opinions may be biased too, but at least it can give you a bunch of mixed views that are closer to the truth.

As for traditional media, the Economist does tend to be relatively neutral, and not adding too much of their own "secret ingredients". But that's just my own opinion.

tomkarlo7• 15 years ago

Once you're rich enough, you become concerned with protecting that wealth and your own well-being. You want transparency from your government, rule of law (in a transparent, predictable manner) and political stability. Those are not strong points in China these days.

Volpe7• 15 years ago

Political stability is not a strong point in china?

tomkarlo7• 15 years ago

On the order of a lifetime (50-60 years)? No. Especially given that you have an incumbent political party that is (at least in name), still Communist and committed to the equitable distribution of wealth across the population.

China has a lot of internal tensions, not the least of which is that as people become more affluent, they start to want greater transparency from the government, greater fairness, and more independence. All of those desires put them in conflict with the current regime. The party may be able to keep things under control, but I don't think there's any question that it's already grappling to maintain order via censorship, suppression of dissent, etc.

Selvik4• 15 years ago

I think this is true. Additionally, as other commenters have mentioned, daily life in china is a bit of a health risk due to the crazy traffic, air pollution, poor food safety etc.

tomkarlo7• 15 years ago

I forgot this - I have two friends who lived in Beijing for years but moved to LA when they had kids, in large part because the air pollution was so bad they said they could feel it in their throats when they woke up each morning if it was going to be a bad day. Nobody likes to feel like their they breathe is killing them each day.

There was a comment (I think on Top Gear, so take it with a grain) that if you drive a new Porsche through Beijing, the air coming out the tailpipe is cleaner then the air going in the front.

quant18• 15 years ago

The original report is here (in Chinese): http://pic.bankofchina.com/bocappd/report/201111/P0201111015...

Later on I'll have a read and translate any interesting parts of it. Right now it's 4 AM here, I'm coming off a long and not-very-fun debugging session, and I'm going to sleep.

There was a very similar report published about half a year ago by China Merchants Bank. HN discussion: http://news.ycombinator.com/item?id=2660178

I blogged about that report and translated some portions of it at the time, see there for my thoughts on these things. my analysis in short: not many people taking concrete action, not many people leaving permanently. http://notlearningcantonese.posterous.com/rich-emigrants-as-...

zanny• 15 years ago

Since this is Hacker News and all, I'll pose a question: we had that news story on how few Indian hackers and tech startups there are, what about in China? Are any of these millionaires profiting off things like Baidu is with web tech working for the government?

angkec3• 15 years ago

This may add more insight: I'm Chinese (mainlander) myself and I'm not rich (student). All my friends are not rich either. Yet almost everyone wants to leave the country.

This is probably due to high real estate prices (around 1M RMB in large cities like Beijing and Shanghai for a decent apartment that can get you a girl to marry you, yet you don't really "own" the property even if you buy it. Technically the state still owns your apartment and you were just paying for "usage fee" because that's how communism/socialism works. In comparison, newly college graduates earns around 6k RMB/mo); broken health care system (probably worse than the U.S, since most of the Chinese family are relying on their only child to provide health care money when they grow older); harsh job market (simply too many people for not so many jobs, so the wage becomes low); and plus, a dim future for all of the lower income families or family without connections.

Yes you can argue that there's so many opportunities in China, but somehow we voted with our feet: everyone who has a means to leave left. Most of the famous Chinese actors are now foreign citizens or at least with a green card alike. For average families, they send their kids overseas for school. That's why you see so many Chinese students overseas, doing boring PhD degrees if they are poor or enroll as an undergrad if their family could afford. For their families, getting their kids to an overseas school is like taking the first step to a much more promising future.

ced• 15 years ago

Is the situation improving?

angkec3• 15 years ago

No. The worst thing is it's going down: living costs are getting much higher because of inflation while wages are far from catching up, real estate is still in a bubble, and it feels like the gov is getting more and more corrupted, blocking ordinary people from having a decent/good life.

cma2• 15 years ago

>Technically the state still owns your apartment and you were just paying for "usage fee" because that's how communism/socialism works.

The fee part sounds like something other than communism.

angkec3• 15 years ago

I know! And it's ridiculously high, beats any property tax in U.S. That's probably one of the reason why the Chinese government is so rich.

The propaganda has invented a new saying, calling this the Chinese Socialism, and it tries to credit itself for the economic boom after the 1980s. We the people think that the gov is just trying to collect massive money after they abandoned soviet communism so everyone had a chance to make a better life. The chance is getting slimmer as the gov is getting much more greedy than in the 80s.

SearchDream• 15 years ago

Agree on almost everyone want to leave, I have about 10+ friends and colleague come to work in Singapore like me.

donaq• 15 years ago

Ironically, a significant group of Singaporeans want to leave because costs of living here are super high.

hachiya2• 15 years ago

The one child policy of China is pure evil. It's a wonder the forced abortions and these effects don't feature more prominently in this discussion.

tobtoh• 15 years ago

And what do you propose is the alternative? Very easy to take a moral high ground when you don't have to worry about the repercussions of over population and strained resources. As the poster said themselves - too many people in China.

vorg• 15 years ago

As long as the US is somewhere a lot of people from ethnic-based nations want to immigrate to, the US can have many more financial crises and not be severely impacted.

PakG1• 15 years ago

One of my co-workers here in SZ has a foreign boyfriend, but she doesn't want others to know about it. I asked her why she wanted a foreign boyfriend. She said it was because she didn't believe in the future of this country. This is her way out.

My other co-worker hates it that Chinese girls seem to prefer foreign boyfriends (albeit a stereotype, but who knows how reflective it is of reality?). He deems it particularly difficult because there are so many more men then women in China already.

tryitnow• 15 years ago

Hmmm, it's really too bad the US doesn't have enough sense to invite more of these people into our country.

ImprovedSilence• 15 years ago

There's also the little problem of China letting them out.

rubashov• 15 years ago

http://www.vdare.com/posts/chinese-immigrant-shows-gratitude...

http://www.vdare.com/posts/chinese-the-exemplary-immigrants

Volpe7• 15 years ago

There is too much bias from reporters these days to work out actual trend from manufactured trends with regards to china.

Silly to say "half of china's millionaires want to leave" without saying how that percentage is different from "all chinese"...

China long ago loosened restrictions on emigration, to allow Chinese to be educated overseas and then (hopefully) return to China, so that it could benefit. I think this increase of emigration could be a natural progression of that policy (as Chinese now have a lot more ties in other countries).

The 'unaffordable housing' issue, sounds similar to Australia (Median house price is 8+X median yearly/salary), so I doubt it is a reason for leaving.

People who are saying it's "too be free", are clearly just anti-P.R.C, again, by-in-large chinese are happy/apathetic about the govt in china. Those that care about politics, join the party and have just as many rights (to vote and affect change as americans have).

Very difficult to work out 'truth' here...

keyworks2• 15 years ago

Just for the record, that photo isn't really China. It's SAR Hong Kong. Different legal systems, different story.

known• 15 years ago

Common man also want to leave China http://www.rediff.com/business/slide-show/slide-show-1-tech-...

androidstar• 15 years ago

THIS IS A PROBLEM

Half of China's millionaires want to leave country

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