The World’s Wealthiest Cities Report 2024, released in May, showed that six Chinese cities among the top 50 globally have dropped an average of two places compared to last year, signaling a decline in overall wealth. The Hurun Global Rich List 2024 also revealed a declining trend among China’s wealthiest citizens.
On May 7, investment migration firm Henley & Partners and wealth intelligence firm New World Wealth released the Global Wealthiest Cities Report. New York City topped the list, followed by San Francisco, Tokyo, and Singapore. Hong Kong was in ninth position and Beijing in tenth.
Apart from Hong Kong and Beijing, other Chinese cities making it to the top 50 include Shanghai, Hangzhou, Shenzhen, and Guangzhou.
This ranking primarily relies on the number of residents and asset holders with wealth exceeding $1 million in that city.
Comparing the rankings with the previous year, shows, on average, Chinese cities dropped by 2.33 places on the list. Hong Kong descended from seventh to ninth place, Beijing from eighth to tenth, and Shanghai from ninth to eleventh.
Decrease in China’s Wealthy Citizens
U.S.-based Chinese economist Li Hengqing recently told The Epoch Times that due to China’s economic decline and real estate market turmoil, the assets of the vast majority of people on the rich list have shrunk, with many assets being liquidated.
On March 25, the Hurun Research Institute released the Hurun Global Rich List 2024, with Chinese entrepreneur and Nongfu Spring’s chairman Zhong Shanshan topping the rich list in China with a fortune of 450 billion yuan ($63 billion). However, this is a 9 percent decrease in his wealth from the previous year.
High-net-worth individuals (HNWIs) in China, with assets exceeding tens of millions, largely derive their wealth from corporate equity. Due to the Chinese Communist Party’s (CCP) extreme pandemic lockdowns, China’s economy is experiencing a downturn even after the pandemic. China’s stock market capitalization has evaporated by $6.3 trillion over the past three years, leading to a decline in these wealthy individuals’ companies and personal wealth. The drop in China’s real estate prices has also shrunk the net assets of HNWIs holding real estate, according to the report.
Forbes magazine’s World Billionaire’s List in 2024 also shows that the number of wealthy individuals in China totals 406, a consecutive decline for three years. Last year, there were 495 individuals, and in 2021, there were a record-breaking 626 individuals.
Emigration of China’s Wealthy
Amid China’s economic decline and increasing political risks, many wealthy Chinese citizens have transferred their assets overseas for investment and risk avoidance, with many leaving China and emigrating abroad. This is also one of the reasons for the decrease in the number of wealthy individuals in China.According to the Henley Private Wealth Migration Report 2023, an estimated 122,000 HNWIs were emigrating globally in 2023, with China leading in the outflow with an estimated 13,500 millionaires emigrating, an increase of 2,700 people from 2022.
The definition of HNWIs is individuals with assets exceeding $1 million available for investment. The definition of emigration is individuals who have resided in the destination country for more than six months, excluding those who only hold residency in another country without emigrating.
For wealthy Chinese emigrants, the worsening economic, political, and social environment in China along with increased U.S. sanctions against the CCP, have led them to seek financial security and risk avoidance elsewhere.
Data show that on average, each wealthy emigrant from China took away $6.6 million. Last year, 122,000 HNWIs from China took approximately $89.1 billion with them as they relocated to another country.
Andrew Amoils, head of research at New World Wealth, noted in a report that “China continues to lose a large number of millionaires to migration. General wealth growth in the country has been slowing over the past few years, which means that the recent outflows could be more damaging than usual.”
Mr. Li said, “Whatever industry Xi Jinping focuses on, that industry suffers, and then collapses.” He pointed to the real estate industry as an example, saying that some wealthy individuals not only saw their assets wiped out but also incurred significant debts. Therefore, a significant reduction in the number of wealthy individuals is not surprising, Mr. Li explained.
He emphasized that, compared to the powerful elites within the CCP and their families, those on the rich list are actually just the tip of the iceberg when it comes to China’s wealth. People like former CCP leader Jiang Zemin’s grandson, Jiang Zhicheng, their massive wealth is simply invisible. When they foresee risks in China’s economy, they move their investment companies from Hong Kong to Singapore long ago, Mr. Li said.
China’s Widening Wealth Gap
It is worth noting that although the economic downturn in 2023 led to a decrease in the number of wealthy individuals in China, the number has been continuously increasing over the nine years before 2023.In contrast, the income growth of ordinary Chinese people has been relatively slow.
Chinese leader Xi Jinping has been vigorously promoting and pushing for “common prosperity” over the past decade, but the above figures imply that China’s wealth gap is gradually widening.
The CCP does not release any data on the actual income situation of the Chinese people or the wealth gap. However, former Chinese Premier Li Keqiang has previously admitted that at least 600 million people in China earn less than 1,000 yuan ($140) per month, highlighting the enormous wealth gap in China.
“Now China is in a state of decline. The economy and politics are both falling into a worsening direction,” Mr. Li said.
