Key Takeaways:
- The number of Chinese citizens in the “Billionaire Club” dropped 20.2% in one year.
- China’s zero-Covid policy has a direct correlation with fewer billionaires.
- Lower numbers in the housing and technology sectors have also affected overall economic conditions.
WISCONSIN (CoinChapter.com) — China’s most affluent citizens have suffered the biggest drop in wealth in two decades. The 100 richest people in China lost a combined $573 billion since last year’s groupings.
Hurun’s Rich List of China stated that the nation’s billionaires shrunk from 1,185 to 946 in one year.
Sixty-eight-year-old Zhong Shanshan has led China two years in a row as the richest person with a personal wealth of ¥5 billion, or $703 million. Mr. Shanshan is the founder of Nongfu Spring bottled water.
Interestingly enough, although the list of billionaires dwindled, Mr. Shanshan’s bank account increased; his assets escalated from ¥377 billion to ¥455 billion.
Some other well-known people who took a financial hit are Zhang Yiming (age 39), the founder of TikTok, and Robin Zeng (age 54), the founder of battery manufacturer Contemporary Amperex Technology; their riches decreased $9.9 billion and $12.43 billion respectively.
Overall Global Decline Contributed to Fewer Billionaires
China’s main driver in the economic slowdown was its zero-Covid policy.
The nation’s approach to stopping the spread of Covid was so strict that government officials called it “dynamic zero.” They realize completely stopping Covid is unrealistic, but “dynamically” acting as quickly as possible to stop the spread is the preferred strategy.
China’s CSI 300 Index is down 22.41% over the past year, another big contributor to the drop in economic wealth nationwide.
An external factor negatively impacting China’s economy is the Russia-Ukraine war.
Housing and Tech Sectors Also Down
According to Reuters, the most recent housing numbers show new home prices fell 0.2% in September, which is down two months in a row. In addition, new home prices are down 1.5% year-over-year, with 54 Chinese cities out of 70 reporting declines.
The tech sector is also down, and President Xi Jinping is taking much of the blame. Technology companies in China feel that Xi has an “old school” style approach and, to some extent, is closing off tight alliances with other nations in a “Cold War kind of conflict.”
Billionaires Will Be Watching Chinese Leadership Closely in 2023
President Xi was elected to a third term with a chosen leadership team of loyalists.
The close-knit group is concerned with investors as they believe Xi will strongly influence policy management; money markets think that it will be restrictive going forward, especially as the zero-Covid policy is used as a barometer for the government’s decision-making.
