The wealth of China’s 100 richest people shrank by more than a third in 2022, as Beijing’s zero-Covid policy, faltering economic growth and a push for “common prosperity” dented valuations of top companies and ate into private wealth.
The fortunes of the country’s wealthiest tycoons fell 39 per cent to $907.1bn in 2022 from $1.48tn the year before, according to the Forbes Rich List. It was the biggest decline since the publication started compiling the list more than 20 years ago.
The wealth of only two people on the list grew, Forbes said, while 79 billionaires became poorer. There were three newcomers to the list.
Forbes blamed the decline on Beijing’s tech crackdown, a strict adherence to zero-Covid policies that has throttled growth and damped consumer demand, and concerns over the outcome of the 20th Communist party congress in October. The slide in the value of the renminbi also chipped away at fortunes.
“The past year has been one of China’s most difficult in recent decades,” Russell Flannery, Forbes’ editor-at-large, said.
Zhong Shanshan, the chair of Nongfu Spring, the bottled water company, remained in the top spot on the list with $62.3bn, down 5 per cent from the year before. Robin Zeng, chair of CATL, the world’s largest electric vehicle battery maker, remained in third place after his fortune fell by 43 per cent to $28.9bn.
The net worth of Pony Ma dropped by more than half after the share price of internet giant Tencent, where he is chief executive, plumbed four-year lows this year. Alibaba founder Jack Ma saw his personal fortune almost halved after his company dropped roughly 60 per cent in value.
Shein-founder Chris Xu was a notable newcomer, with a fortune estimated at $10bn, while Hui Ka Yan, chair of struggling property group Evergrande and once one of the country’s richest people, dropped off the list.
China’s economy has faltered after repeated Covid-19 lockdowns, with policymakers battling to boost consumer spending. The official goal of 5.5 per cent growth was already well out of reach, analysts said, while the World Bank predicted the country would grow more slowly than the rest of Asia for the first time in more than three decades.
Gross domestic product expanded just 3.9 per cent year on year in the third quarter.
The rapid decline in wealth also follows a push for “common prosperity”, a political agenda that seeks to reduce inequality through wealth distribution and welfare policies.
President Xi Jinping, who secured an unprecedented third term in power at the party conference, has insisted that common prosperity would be one of the country’s most important objectives over the next 15 years.
“[Xi’s] common prosperity programme has attacked the two sectors with the largest concentration of wealth — property and technology,” said Andrew Kemp Collier, managing director at Orient Capital Research, adding that the technology sector was “almost cut in half” by a spate of new regulations.
“It is clear that Xi Jinping favours the state system because of the control it offers the central government to engineer changes in the economy.”
China’s biggest companies, including Alibaba and Tencent, have had to shift their strategies or pledge funds to social responsibility programmes in line with the policy, while their valuations have plummeted as investors worry that Xi wants to prioritise political goals over capital growth.
The total net worth of individuals on the Hurun China Rich List, a separate gauge of the country’s richest people that was released on Wednesday, shrank by 18 per cent.
The number of the people on the list, who have wealth of at least Rmb5bn ($690mn), shrank 11 per cent to 1,305.