News

    China's New Wealth Underscores Inequalities

    New surveys of mainland China's wealth show the country has at least 345,000 U.S. dollar millionaires and 108 known billionaires. As VOA's Kate Woodsome reports from Hong Kong, soaring stock and property prices are key factors in this rising wealth - and a major contributor to a growing income gap that has China's leaders worried.

    A 26-year-old woman worth $17 billion is the richest person in China, and in all of Asia. Yang Huiyan achieved her lofty status thanks to her majority stake in Country Gardens Holdings, a real estate development company founded by her father.

    The Shanghai-based Hurun Report counted Yang among its list of China's 800 wealthiest people. Last year, the report listed just 15 U.S. dollar billionaires, but this year, the number has risen to 108.

    The figure means that China now has more billionaires than any other country in the world except the United States, which has more than 300. Forbes magazine, which regularly documents such things, says there are 36 billionaires in India, and 24 in Japan.

    Rupert Hoogewerf, who publishes the Hurun Report, says Yang Huiyan and many other ultra-rich Chinese made their fortunes listing their companies on the stock market.

    "The stock market over the past year has surged by over 100 percent in China. And the main driver of it is there's a lot of money overseas looking for good growth opportunities. Domestically speaking, it's been the same issue," he said.

    China's rapid modernization has spawned a building boom. New buildings are popping up in cities as fast as old ones can be torn down. The World Bank has estimated that between now and 2015, half of the world's construction will take place in China.

    Hoogewerf says all this new real estate has created a lot of instant wealth.

    "Last year lots of billionaires that were created - really was predominantly through property and retail. And both of those were led by urbanization. Because China's going through a massive urbanization phase," he said.

    Migrant workers from China's impoverished countryside are the muscle behind the growth, but they, like most of China's 1.3 billion people, reside at the opposite end of the economic scale from people like Yang Huiyan.

    As many as 200 million Chinese have left their rural homes to work in factories and construction sites on the country's southern and eastern coasts.

    Rights groups say the migrants are paid paltry wages or, sometimes, nothing at all.

    Paul Cavey, a China economist with Macquarie Securities, says the migrants suffer because of rapid political and economic changes that have benefited powerful businessmen rather than the working class.

    "What you have in China is authoritarianism but also extreme capitalism," he said. "If you look at a more market-driven economy in the West, there's a lot of protection for people who lose from the system. There's a lot of restraints on competition and monopolies. None of that exists in China. There's very little protection for workers."

    A decade ago, the Chinese government held all land and individuals could not obtain loans. Urban residents worked in state-owned companies and lived rent-free.

    In the late 1990s, the government privatized housing and began granting individual loans. It also privatized many state-owned enterprises, which accounted for most of China's production.

    Robin Munro is with the China Labor Bulletin, a workers' rights group in Hong Kong. He says managers of these enterprises took advantage of the reforms by deliberately bankrupting their companies, then obtaining bank loans to buy the companies at a low price.

    "The former managers emerge as big private entrepreneurs with massive private wealth in their hands. They would lay off most of the workforce and replace them with cheap labor from the countryside," said Munro.

    The migrants are easily exploited and denied social services because they are not legally registered in the cities. Many do not register because they lack required documents. Others fear losing their land back home, so they make frequent trips back instead of settling in a city.

    The state has cut agricultural taxes to help farmers, but Cavey says to narrow the wealth gap, land rights must be respected, and freedom of movement granted.

    "If you leave the countryside but you still own your land at home, you can rent the land out to other farmers so you have an income. And therefore you can monetize the land, so the minimum wage needed to attract you away from the countryside is that much higher," he said.

    The loss of farmland and homes to development projects has sparked thousands of protests in recent years. This unrest has been a significant factor in President Hu Jintao's call for creation of a so-called "harmonious society."

    President Hu and Premier Wen Jiabao have won praise for acknowledging that the inequality exists.

    In his speech to the 17th Chinese Communist Party Congress last week, Mr. Hu outlined plans to distribute economic growth benefits more evenly, in part by spending more on social programs.

    Cavey says the government knows what reforms are needed, but it does not know how to get the old Communist guard and the new capitalists to agree on them.

    This forum has been closed.
    Comments
         
    There are no comments in this forum. Be first and add one

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Russia's Car Sales Shrink Overall, But Luxury and Economy Models See Growthi
    X
    February 10, 2016 5:54 AM
    Car sales in Russia dropped by more than a third in 2015 because of the country's economic woes. But, at the extreme ends of the car market, luxury vehicles and some economy brands are actually experiencing growth. VOA's Daniel Schearf reports from Moscow.
    Video

    Video Russia's Car Sales Shrink Overall, But Luxury and Economy Models See Growth

    Car sales in Russia dropped by more than a third in 2015 because of the country's economic woes. But, at the extreme ends of the car market, luxury vehicles and some economy brands are actually experiencing growth. VOA's Daniel Schearf reports from Moscow.
    Video

    Video Civil Rights Pioneer Remembers Struggle for Voting Rights

    February is Black History Month in the United States. The annual, month-long national observance pays tribute to important people and events that shaped the history of African Americans. VOA's Chris Simkins reports how one man fought against discrimination to help millions of blacks obtain the right to vote
    Video

    Video Jordanian Theater Group Stages Anti-Terrorism Message

    The lure of the self-styled “Islamic State” has many parents worried about their children who may be susceptible to the organization’s online propaganda. Dozens of Muslim communities in the Middle East are fighting back -- giving young adults alternatives to violence. One group in Jordan is using dramatic expression a send a family message. Mideast Broadcasting Network correspondent Haider Al Abdali shared this report with VOA. It’s narrated by Bronwyn Benito
    Video

    Video Migrant Crisis Fuels Debate Over Britain’s Future in EU

    The migrant crisis in Europe is fueling the debate in Britain ahead of a referendum on staying in the European Union that may be held this year. Prime Minister David Cameron warns that leaving the EU could lead to thousands more migrants arriving in the country. Meanwhile, tension is rising in Calais, France, where thousands of migrants are living in squalid camps. VOA's Henry Ridgwell reports.
    Video

    Video Valentine's Day Stinks for Lebanese Clowns

    This weekend, on Valentine's Day in Lebanon, love is not the only thing in the air. More than half a year after the country's trash crisis began, the stink of uncollected garbage remains on the streets. Step forward "Clown Me In," a group of clowns who use their skills for activism. Before the most romantic day of the year the clowns have released their unusual take on love in Lebanon -- in a bid to keep the pressure up and get the trash off the streets. John Owens reports from Beirut.
    Video

    Video Families Flee Aleppo for Kurdish Regions in Syria

    Not all who flee the fighting in Aleppo are trying to cross the border into Turkey. A VOA reporter caught up with several families heading for Kurdish-held areas of northern Syria.
    Video

    Video Rocky Year Ahead for Nigeria Amid Oil Price Crash

    The global fall in the price of oil has rattled the economies of many petroleum exporters, and Africa’s oil king Nigeria is no exception. As Chris Stein reports from Lagos, analysts are predicting a rough year ahead for the continent’s top producer of crude.
    Video

    Video 'No Means No' Program Targets Sexual Violence in Kenya

    The organizers of an initiative to reduce and stop rape in the informal settlements around Kenya's capital say their program is having marked success. Girls are taking self-defense classes while the boys are learning how to protect the girls and respect them. Lenny Ruvaga reports from Nairobi.
    Video

    Video Chocolate Lovers Get a Sweet History Lesson

    Observed in many countries around the world, Valentine’s Day is sometimes celebrated with chocolate festivals. But at a festival near Washington, the visitors experience a bit more than a sugar rush. They go on a sweet journey through history. VOA’s June Soh takes us to the festival.
    Video

    Video 'Smart' Bandages Could Heal Wounds More Quickly

    Simple bandages are usually seen as the first line of attack in healing small to moderate wounds and burns. But scientists say new synthetic materials with embedded microsensors could turn bandages into a much more valuable tool for emergency physicians. VOA’s George Putic reports.
    Video

    Video Researchers Use 3-D Printer to Produce Transplantable Body Parts

    Human organ transplants have become fairly common around the world in the past few decades. Researchers at various universities are coordinating their efforts to find solutions -- including teams at the University of Pennsylvania and Rice University in Houston that are experimenting with a 3-D printer -- to make blood vessels and other structures for implant. As VOA’s Greg Flakus reports from Houston, they are also using these artificial body parts to seek ways of defeating cancerous tumors.
    Video

    Video Helping the Blind 'See' Great Art

    There are 285 million blind and visually impaired people in the world who are unable to enjoy visual art at a museum. One New York photographer is trying to fix this situation by making tangible copies of the world’s masterpieces. VOA correspondent Victoria Kupchinetsky was there as visually impaired people got a feel for great art. Joy Wagner narrates her report.
    Video

    Video German Artists to Memorialize Refugees With Life Jacket Exhibit

    Sold in every kind of shop in some Turkish port towns, life jackets have become a symbol of the refugee crisis that brought a million people to Europe in 2015.  On the shores of Lesbos, Greece, German artists collect discarded life jackets as they prepare an art installation they plan to display in Germany.  For VOA, Hamada Elrasam has this report from Lesbos, Greece.
    Video

    Video E-readers Help Ease Africa's Book Shortage

    Millions of people in Africa can't read, and there's a chronic shortage of books. A non-profit organization called Worldreader is trying to help change all that one e-reader at a time. VOA’s Deborah Block tells us about a girls' school in Nairobi, Kenya where Worldreader is making a difference.