Buildings in Shenzhen on Tuesday, March 15, 2022. The former fishing village, now a tech hub known as China’s Silicon Valley, has joined Beijing and Shanghai as the world’s top three cities for billionaires, overtaking New York for the first time this year. .
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Three years ago, American businessman Raj Oswal traveled to the Chinese city of shenzhen on behalf of a client. He was so impressed that he stayed and started his own technology company.
“You can’t find many other cities in China or around Asia that really embrace innovation the way Shenzhen does,” Oswal said, comparing his move there from California to his father’s decision in the 1970s to leave India for be able to continue their studies and a career in the United States.
Increasingly, it is also full of money. The former fishing village, now a tech hub known as China’s Silicon Valley, has joined Beijing and Shanghai as the world’s top three cities for billionaires, overtaking New York for the first time this year.
According to the Hurun Global Rich ListAn annual ranking compiled by a private company based in Shanghai, Beijing is home to the most billionaires in the world with 144, followed by Shanghai with 121. There are 113 billionaires in Shenzhen, compared to 110 in New York, while London came in fifth. with 101.
The growing concentration of wealth is not new to the people of Shenzhen, who have added eight billionaires since last year.
“It’s almost more of a wake-up call to the rest of the world,” said Rupert Hoogewerf, president and principal investigator at Hurun Report, the company behind the list.
While the rankings may fluctuate, he said the growing number of billionaires in Shenzhen reflects a “megatrend” that will draw more young entrepreneurs to the city in years to come.
“It is a significant indicator of where Shenzhen is coming from and where it is going,” he said.
Shenzhen’s rise began in 1980, when it was named China’s first special economic zone as part of the country’s “reform and opening up” under then leader Deng Xiaoping. That allowed the city to experiment with market capitalism in an effort to attract foreign investment. From 1979 to 2021, Shenzhen’s gross domestic product grew from less than $28 million to nearly $475 billion.
Today, the city is home to some of China’s biggest tech companies, including telecommunications giant huawei and Internet conglomerate Tencent, inspiring others to follow. Last year, 2,500 new state-recognized high-tech enterprises were established in Shenzhen, bringing the total number to 17,000, according to the local government.
It is also part of what China calls the Greater Bay Area, an integrated economic and commercial hub that aims to link Shenzhen with eight other cities in Guangdong province along with the Chinese territories of Hong Kong and Macau.
Opportunities were apparent to Oswal even when he took a taxi from Shenzhen airport after he first arrived in 2019.
“All the stereotypes I had about Chinese cities fell apart one by one with the changing green modern urban landscape along the highway,” he said.
Heng Chen, an associate professor of economics at the University of Hong Kong, said Shenzhen’s push was aided by its welcoming environment for entrepreneurs.
“The population structure is still very young compared to other super cities or first-tier cities in China, so that is one of the reasons why it is a very attractive place,” he said.
In addition, Shenzhen government officials “commit a large amount of financial resources to attract top talent from the rest of the world.”
But the city has also faced great challenges during the coronavirus pandemicespecially in the last few weeks China battles its worst outbreak in two years. The government’s zero-tolerance strategy relies on border closures, mass testing and strict lockdowns, and the restrictions have caused delays at factories in Shenzhen, as well as at its port, one of the world’s largest.
During a week-long lockdown in Shenzhen last month, authorities gave Apple supplier Foxconn Technology Group permission to restart some manufacturing operations using a “closed-loop” system that required employees to remain on site.
Despite financial pressures from the pandemic, China’s economy has continued to grow “in part because Chinese cities are so flexible,” said Shang-Jin Wei, an economics professor at Columbia Business School and a former chief economist at the Asian Development Bank. “They can adapt to new situations.”
Wei also said that Shenzhen offers high-tech enterprise-friendly policies such as tax breaks.
According to the Hurun Report, as of January 14 there were 3,381 billionaires in the world, a net increase of 153 from last year, and their total wealth increased 4 percent to $15.2 trillion. Of these, 1,133 are in China and 716 in the US China overtook the US in terms of the number of billionaires in 2016.
But China’s billionaires have also been “hit hard” in the past year, according to the report, amid a regulatory crackdown in technology, education and other industries and government “common prosperity” campaign promote a more equitable distribution of wealth.
China lost 160 billionaires last year, more than any other country. Colin Huang, founder of e-commerce platform Pinduoduo, experienced the biggest loss of wealth with $50 billion when shares of his Nasdaq-listed company plunged. Xu Jiayin, president of the embattled property developer Evergrande Grouplost more than $23 billion because his company continues to miss bonus payment deadlines.
Zhong Shanshan, the founder of the Nongfu Spring bottled water and beverage company, remains the richest person in China with a wealth of $72 billion. ByteDance founder Zhang Yiming, whose company owns the tiktok video app, is second with $54 billion. Right behind him is Zeng Yuqun, founder of electric vehicle battery maker CATL, who has a fortune of $53 billion.
Pony Ma of Tencent and Jack Ma of tech giant Alibaba, two of China’s biggest names in businessboth dropped out of the list of the three richest people in China for the first time since 2015. Pony Ma fell to fourth place on the list when her wealth dropped to $52 billion, followed by Jack Ma at $37 billion.
There are no Chinese billionaires in the global top 10, led by the CEO of Tesla and SpaceX. Elon Musk with a net worth of more than $200 billion. Hoogewerf said that’s partly because Chinese billionaires tend to run businesses with a national focus, rather than a global one.
Indian telecoms tycoon Mukesh Ambani was the only Asian on a top 10 list, dominated by the United States and France. But he has been swapping the title of Asia’s richest person with Indian infrastructure tycoon Gautam Adani. The two men, who according to the Hurun Report each have a net worth of around $100 billion, were also neck-and-neck at the Forbes list of the world’s billionaires which was released this week, peaking at No. 10 and 11.