78% of Tencent Users Dispise China’s Rich. No Wonder They are Exiting

Monday, July 16, 2012 8:58
Comments Off on 78% of Tencent Users Dispise China’s Rich. No Wonder They are Exiting

There are fewer divides more tenuous than the growing disparity between the rich and the poor in China.

Unlike in previous years where the focus of conversations focused largely on how the rich were exploiting the poor on the factory floor and on the street corner.  Issues of affordable housing, environmental contamination, and access to healthcare were secondary issues as the “poor” were not pushing back (yet).  But, now that all of these discussions are on the table, the discussions of HOW the rich have accumulated their wealth are now the focus.

For those at the top, it was once a conversation about “what ifs” and what would happen were the gap to get too wide, with the general conclusion being everyone was safe as long as the tide continued to lift all boats. A conclusion generally shared, particularly as China statistically moved 400 million above the poverty “line”.  So, keep the economy humming, move the masses into the cities, create “jobs”, improve the social safety nets, and maintain the education system.  These were the basic “musts”. Do that, and the dream is still within “reach”.

But over the last couple of years has turned into something else. It has moved from the “what ifs” to the “what is your plan”. And a sense of urgency now exists at the upper reaches of China’s economy, and political body, that is not about which policies could help to balance the economy, about managing resources better, or building more affordable housing… it is about exit plans.

As the WSJ report top of Chinese wealthy’s planning to leave China spells out:

The main reasons people want to move abroad, he said, are their children’s education and for better healthcare. Some want to leave because they got their money illegally, such as corrupt government officials and businesspeople, while others are inspired by friends who have already emigrated to the U.S.

“They want to get a green card even though they may still do business here in China,” Liu said. “They might have sent their wife and children abroad. [..]

Getting a foreign passport is like “taking out an insurance policy,” said Rupert Hoogewerf, who compiles the Hurun Rich List, China’s version of the Forbes list.

A trend that for many was benign in the past as overseas study and work was seen as something good for the individual’s path, but has recently become the source of a backlash that is beginning to be reported in a way to where one could reasonably expect that trend to speed up. That instead of being a good step for the individual looking to improve themselves (and their family), it is the escape path for those who have extracted profits in every manner possible.

As highlighted by the the recent Tencent survey finding that 78% of netizens saying they DESPISE China’s wealthy

Of the over 5,000 respondents, 78.32% said they despise them. Most think the rich don’t deserve their fortunes, according to Duowei news, a Chinese news website based in New York.

In Tencent’s survey, the respondents can choose from three answers: the first is “Despise them, because they don’t deserve their fortunes;” the second is “Don’t despise them — most of them earn their fortunes bare-handed;” and third, “Only despise them a little bit, so I’ll fight to become one.”

Which is where a number of my recent conversations come in.

That regardless of how the wealthy made their money, the fact is that they are now shipping that wealth overseas.  Divesting of assets and investment plans in China,  looking for safe zones where wealth can be preserved and the family unit can lead a “peaceful” life.

For some it starts with the children, an anchor baby that will bring a green card 18 years later or an older child seeking education and employment overseas.  Both justify an investment in some real estate.  for others it is purely business investment related, as Bloomberg’s recent piece highlights.  Buying real estate and setting up firms overseas, that provide visas and PR status. Which, to many I speak with is the ultimate smack in the face of those who are being “left behind” as the lasting legacy of this cycle will be that to get rich and get out is glorious.. and for those who were left behind?

See ya, and I wouldn’t wanna be ya.

It is a trend that I personally suggest keeping an eye on as, simply put, for many in China this is one of THE conversations and it has the potential to alter the China market from a number of business critical angles.

Both comments and pings are currently closed.