All indications are that by 2020, the Chinese economy will surpass the US economy and that by 2030, the standard of living in Asia will be equal to that of Europe’s today. China’s affluent middle class has produced a million Chinese whose personal wealth is estimated at 10 million yuan or more. They are a further 60,000 superrich individuals with assets of over 100 million yuan. Major changes are taking place in the economy and all layers of society are bound to be affected by the country’s opening up to the outside world. Traditional Chinese values are becoming more closely entwined with Western principles.

In the late 1970s, Deng Xiaoping unveiled the idea of the socialist market economy, which has now become the state market economy. Millions of Chinese harkened enthusiastically to the party leader’s admonition to amass wealth and they became richer faster than anyone else in history. Most of today’s successful Chinese amassed most of their wealth in the last decades. They are younger than their American counterparts and most of them built their fortunes in private enterprise. The average superrich Chinese is 43 years old. In the late 1960s, Mao Zedong claimed that China was building and producing not to make profits but for the good of world revolution. Today the ideological approach has been supplanted by market-driven expedience. Furtherance of Chinese self-interest has taken precedence and carrying out common goals has been relegated to the backdrop.

The self-awareness of the Chinese – both in the middle class and among the wealthiest – has risen significantly. People with a higher education and income are becoming bolder about facing down the authorities in defence of their interests. Values vary the most between rural and urban dwellers, with the latter more open to adopting Western attitudes. As western countries represent well-developed technologies, power and modernity, a large share of those in the PRC will try to follow this model as well as they are able. Marketing directors in other countries have realized that Chinese consumers are very susceptible to incitement to embrace Western values.

Before this decade is out, China is expected to become the world’s greatest market for elite goods. The affluent Chinese is a strong consumer of luxury goods. While European tourists mill in Shanghai’s markets for knock-offs of famous brands, Chinese travel to Paris to shop for originals at the tax-free stores, as local prices are high thanks to the hefty import duties and luxury taxes. Chinese prefer trademarks they know – they feel one can’t go wrong with Versace or Coachi. To ensure a good sales figures, a smart merchant opens a little corner of a grocery store for Prada purses. Louis Vuitton’s brown and yellow monogrammed logo can be seen on different types of handbags, as well as on a footstool that draws customers into a pedicure salon. One in 175 people in Shanghai is a yuan millionaire, but every major city has plenty of customers with good purchasing power and purveyors of luxury goods expanded to the provinces long ago.

Any self-respecting wealthy Chinese esteems prestigious club member status. Well-tuned Bentleys, Rolls Royces and Jaguars can be seen cruising around in the elite residential communities in the big cities, with Lamborghinis the latest toy to be discovered. Wealthy Chinese frequent antique markets and bid at auctions in Hong Kong and New York. They invest into traditional Chinese art and world classics, amassing art collections worth millions of dollars. Chinese are fond of conspicuous displays of wealth. The golden trinity for the successful Chinese is career, money and beautiful things. This facile image is only marred by the worry about how to preserve and grow one’s wealth in China’s ostensibly stable society.

A staff member from Interasia Auctions in Hong Kong displays an unissued Chinese stamp from 1968 called “Great Victory of the Cultural Revolution” , estimated to fetch US $960,000 - 1.155 million). Surging demand from newly wealthy Chinese for art, wine and other collectibles has helped turn Hong Kong into the world’s largest auction hub after New York and London. Photo: Scanpix

In spite of the great economic growth, a large percentage of Chinese are seeking opportunities to take out their capital and emigrate. They are fascinated by the prospects for legalizing their money abroad and investing it without risk. The representations of Western countries in China have noticed an increase in applications for investment and business visas. The Chinese are investing their money into elite real estate in London, Sydney and New York and buy depreciated real estate in US for cash.

Those who are well off complain that they own practically nothing in their homeland and they are stymied by the leasehold system that confers only 70 years of ownership on acquired real estate. The educational level at Western private schools and the social net in the Western world are tempting. Chinese looking to emigrate do so because they want to be part of the international business world and travel more easily. Successful individuals may also feel stymied by the curbs on freedom of speech, as urbanized and wealthy Chinese are more oriented to democratic values.

Also hastening to emigrate are corrupt officials and businesspeople who became rich in the last decade when regulatory and supervisory systems weakened during the boom period. Legislation is always a few steps behind business in China. Wealthy Chinese know that their wealth arose in an unstable environment and they fear that economic reforms will suddenly be reversed. Nor do the harsh punishments, often even the death penalty, meted out for bribery foster a sense of security. People want personal security and safeguards for their money. Taking foreign citizenship is comparable with a life insurance policy and those born in Hong Kong at the right time can feel fairly worry-free. The most popular countries for emigration are the US, Canada, Singapore and Western Europe.

Growing environmental awareness may be one reason that people emigrate. Organic farms are growing in popularity but their output certainly would not be worthy of ecologically pure designation in Europe. The richest locals in Shanghai and foreigners consume much produce from eco-farms. The price is several times that of conventional stores – but the location just a few dozen kilometres from Pudong international airport does not guarantee the ecological purity of the produce grown there. The thinking Chinese person has understood that affluence does not allow them to access much significantly cleaner food and air and they are concerned about their personal and family’s health.

Chinese seek American-style rule of law, education and social well-being above all outside China, voting with their feet. The main obstacle to emigration can in some cases be unwillingness to move far away from their ancestors.

Functional family ties and friendships are held in high regard in China. Westerners may be surprised to learn how important personal connections are in cultivating economic ties. Traditional Chinese family life was very strict and rule-driven. After Maoism, many of the restrictions have disappeared and Chinese families operate increasingly similarly to the Western lifestyles. Although family remains important in China, its role is diminishing strongly for young people. In spite of the changes, respect for elders and the elderly lives on as an important principle in Chinese society.

More and more, though, the Western, nuclear family model has become predominant, where the family consists only of the parents and their children (or just the parents). The Western world sees, with reason, China’s one-child policy as an unjustified restriction on human rights. Many financially secure Chinese actually do not personally want more children. They prefer to invest the time and energy spent on children in a more self-centred fashion. They do not need successors to ensure their retirement and are not concerned about the ageing of the Chinese population.

For decades, Chinese families have preferred boys over girls as better poised to provide for their family in future. The deliberate shunning of girls has now led to a situation where more than 30 million single men will have a hard time finding a bride in the next 10 years due to a shortage of marriageable women. Men who are more financially secure undoubtedly hold an advantage, insofar as a bride’s family in Shanghai for instance also expects a suitor to have a well-compensated job and personal living space.

Students attend their college graduation ceremony in Shanghai’s Fudan University on 2 July 2011. China began expanding university enrolment in 1996 to meet growing personnel demands as the economy boomed, but the government is concerned about how to create enough jobs for the millions of college students who will graduate between 2011 and 2015. Photo: Scanpix

A spoiled nouveau riche generation has arisen, who are criticized for being irresponsible. Having the right lineage and money to spend, they are consumers of various entertainment. A relatively new phenomenon on China’s educational landscape is extracurricular courses oriented to affluent older school-age children. Golf, riding and fencing are popular. Some courses even include a visit to the West Point military academy in the US. Valuable study opportunities are available for those with money to pay for it – the price of a 12-week program can be as much as half a million yuan. Providing their children with a good education is one of the primary aims of wealthy Chinese and the preferred schools are in the US and Europe. Chinese make up a solid majority of international students at American colleges. The ancient view of Confucius regarding equal opportunity to education is far from the rule now in China.

Yet Confucianism has reared its head in the recent decade in China. Officials latch on to it and talk of the need to balance society. The hope, years ago, was that if the more capable, trustworthy people were allowed to accrue wealth, the people would later take care of the rest of society. Unfortunately it did not go that way, and individualism and harsh economic competition are the order of the day in China. Until as recently as 30 years ago, the Chinese people were still consistently poor, and thus today they are less inclined to accept the stratification that has occurred. The emigration of the successful ones sows additional tension into society, and corruption accusation and swindles have fuelled animosity toward the rich. Chinese history has also taught the Chinese to revere scholars and look down on merchants. By putting an accent on Confucianism, the Chinese government is trying to reinforce a clear Chinese identity and patch over a social rift caused by stratification. As if hoping for indulgences, young and successful Chinese are establishing charity funds, motivated by social approval. They aim to ease bitterness and show that they want to give back to society. The most popular philanthropic fields are education and disaster relief. In many cases, such laudable initiatives founder in the net of legal acts, which do not regulate charity sufficiently.

In the early 21st century, in spite of foreign influences, China remains a collective society with strong ties between individuals and where people esteem tradition and conformism. Economic growth and innovation will bring an increasing amount of Western influences, but China’s cultural isolation (the particularities of language and historical legacy) will continue to reduce the influences of other civilizations for some time. An IMF analysis recently mentioned that the state of the world’s economy could be improved by precisely the populous Chinese middle class with their spending power. Affluent Chinese are well disposed to shopping, while Europeans find that instead of lavish consumer spending, they have loans to pay off first if they are to escape the debt crisis. 

Krista Reinhold lives and works in Shanghai