By Thubten Samphel, Tibet Policy Institute
The picture on the left is the skyline of of Pudong along the east bank of Huangpu River in Shanghai, China’s financial and commercial hub. Pudong reminds you of the Manhattan skyline as viewed from Ellis Island where the Statue of Liberty stands, a symbol of freedom overseeing the growth of a mighty economy. The Statue of Liberty beckons the world’s ‘huddled masses yearning to breathe free.” Unfortunately, in Shanghai there is no such statue. For this reason, the “huddled masses” of China, or those who are rich enough to do so, migrate to the West to seek security for themselves and their wealth.
Recently there have been a spate of articles and commentaries on how the rich Chinese in China are busy trying to ship their wealth and themselves out of the country. Google search for rich Chinese fleeing China and you get thousands of results. According to Gordon G. Chang, rich Chinese are “those possessing more than 10 million yuan in investable assets,” or, in dollar terms, about 1. 6 million. According to Financial Times’ story of 4 November, China’s Elite Have New International Outlook, “about 60 per cent of rich Chinese people have already begun the process of emigrating or are considering doing so, according to a survey of people with more than Rmb10m ($1.6m) in personal wealth, released this week by Bank of China and rich list publisher Hurun Report.”
In his article of 5 June for Forbes, Chinese Entrepreneurs are Leaving China, Gordon G. Chang writes that the number of rich Chinese or “high net worth individuals according to the China Merchants-Bain study will reach 585,000 this year, almost double the figure for 2008.”
Maths is beyond this writer. He doesn’t know where a million ends or a billion begins. And a trillion must be up in the heavens, swimming with the stars. However, even his rudimentary knowledge of maths tells him that the collective personal wealth of 585,000 Chinese with more than $1.6 million adds up to $0.936 trillion or $936 billion. China’s GDP last year was $5.879 trillion. This means that 0.045 per cent of China’s total population of 1.3 billion owns roughly one sixth of China’s gross domestic product. If 60 per cent of China’s 585,000 rich Chinese with more than $1.6 million are determined or succeed in exporting themselves and their wealth out of China, it means that $561.6 billions will be shipped out of the country. This amount is enough for China or the 0.045 per cent of Chinese to buy Greece or Italy.
The real surprise is not the astronomical numbers involved. The real surprise is why the chief beneficiaries of China’s economic growth are hedging their bets against their own country. These Chinese have been the engine of China’s growth rich and pillars of Chinese society. Why are they abandoning the country that made them so fabulously rich?
There are some surprising answers. One reason for migrating abroad seems perfectly understandable. Rich parents want their children to benefit from better education in the West. Others want to live longer. They want to breathe clean air. Others just want to squirrel their ill-gotten gains away from the law at home. There are those who on their way from rags to riches have bribed so many officials that they feel that if their protectors are toppled they too would be brought down. For many this is one compelling reason to obtain foreign passports. There are other Chinese who seek foreign passports because this makes their travel around the world that much easier and convenient, including securing visas.
One narrative that binds the rich Chinese with their different reasons for emigrating abroad is their common feeling that nothing is certain in the People’s Republic of China. In such a situation, the underlying reason for this mass exile of rich Chinese out of China is one of better safe than sorry. The rich Chinese have highly developed political antennae. Their antennae tells them the future of China is at best uncertain. In their piece on the Financial Times, Jamil Anderlini and Patti Walmeir, quoting un-named sources with connections to the political elite, write, “There is a sense that we are approaching an inevitable breaking point, when the pressures in society will boil over and consume the rulers.”
How did China get into this situation? The answer is provided by Liu Xiabao, the imprisoned Chinese Nobel laureate. There is a review of his book on the 30 November issue of The New York Times. The review says, “In Behind the ‘China Miracle Mr. Liu sees “the ‘miracle’ of systemic corruption, the ‘miracle’ of an unjust society, the ‘miracle’ of moral decline, and the ‘miracle’ of a squandered future.”
How can China get out of this mess? The answer is provided by another Chinese. Yan Xuetong is dean of the Institute of Modern International Relations at Tsinghua University and author of Ancient Chinese Thought, Modern Chinese Power. In an op-ed, How China Can Defeat America , published in the New York Times on 20 November, he has this advice to the Chinese leaders. He asks, “How, then, can China win people’s hearts across the world? According to ancient Chinese philosophers, it must start at home. Humane authority begins by creating a desirable model at home that inspires people abroad.
“This means China must shift its priorities away from economic development to establishing a harmonious society free of today’s huge gaps between rich and poor. It needs to replace money worship with traditional morality and weed out political corruption in favor of social justice and fairness.”
These fresh ideas and suggestions are freely available from some of China’s best minds. Whether the Chinese leadership takes their advice is another matter.
The writer is the Information Secretary of Department of Information and International Relations, Central Tibetan Administration and the Executive Director of Tibet Policy Institute.
(The views expressed here are that of the author and shall not be regarded as views and policies of Central Tibetan Administration.)