In the first quarter of 2015, China reportedly saw a new billionaire emerge every week After the United States, China has the most billionaires in the world, and in the last 15 years the number of billionaires has skyrocketed from just two to over 300
So, why does China have so many billionaires? Well, since 1978, china’s economic growth exploded following the reversal of strict Communist policies instituted by former leader Mao Zedong In the past few decades, the country’s per capita wealth has increased by nearly 10% each year China has gone from being an isolated, closed-market economy to operating countless international businesses utilizing more capitalist ideals Today, Chinese economic policy encourages increased foreign trade and investment Notably, in the 1990s, previously-state-controlled businesses were privatized and given new freedom to pursue profits
Lack of comprehensive regulations for laborers, construction work and environmental pollution have also allowed new Chinese businesses in tech, real estate and retail industries to flourish But billionaires also reap huge profits from rampant corruption Money from new ventures flows mainly upwards to an elite group of business executives and politicians Reportedly about 10% of government spending, contracts and transactions are used “as kickbacks and bribes, or simply stolen" This corruption may stem from some traditional Chinese business relationships which undermine free market policies
Additionally, there is a longstanding precedent of criminal immunity for high ranking members of China’s ruling party However, the current president has led an anti-corruption crackdown, leading to powerful figures being scrutinized China’s ex-security chief was recently sentenced to life in prison for taking bribes, and billions of dollars were confiscated from his family Income inequality between billionaires and the poor is even more severe than many reports indicate This is due to the wealthy hiding excess funds in overseas bank accounts or other difficult to trace foreign investments
But because of recent corruption scandals among the wealthy, Chinese Billionaires are hesitant to broadcast their true wealth members of China’s wealthy elite avoid the public spotlight, and are known as “Vampire Billionaires" Many choose to spend their time abroad, and have been buying significant amounts of foreign real estate in cities like New York and San Francisco Despite recent and severe stock market fluctuations in China, the economy is expected to continue growing One financial expert suggests that due to “high growth opportunities” in Asia, the number of Chinese billionaires will surpass the number of American billionaires in just 5 to 10 years
China’s national wealth is even predicted to overtake the US’s by 2026 However, China must deal with severe corruption located deep within its own political identity, before it can completely realize its full economic profit potential CTA China has a tumultuous history with its Communist past One of their biggest splits was with neighboring Taiwan Find out why the two countries hate each other in this video
Thanks for watching TestTube, don’t forget to like and subscribe, we release new videos daily!