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October 14, 2009

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Nation's rich defy crisis gravity

CHINA'S super-wealthy seem to have put the financial crisis behind them: The average worth of the Chinese mainland's richest 1,000 people grew 30 percent to US$571 million in the past 12 months, according to a report released yesterday.

The figure was even higher than the US$538 million record posted in 2007.

Seven property developers made the top 10 this time, reflecting the boom in the country's housing market, the annual Hurun Rich List found.

"Most of China's wealth creation has been driven by its massive urbanization program, led by property and related industries," said Rupert Hoogewerf, founder of the Hurun Rich List.

"You've got all these cities being built, and that requires property developers, iron and steel manufacturers. The latest thing is cars."

Topping the mainland's rich list was 43-year-old Wang Chuanfu, chairman of electric car and battery maker BYD Co, in which US billionaire Warren Buffett holds a stake. Wang's personal wealth was estimated at US$5.1 billion, elevating him 102 rungs on the ladder to the top.

Another six new faces also turned up among the top 10 for 2009, representing the biggest shake-up in the elite group since the Hurun Report started the rankings in 1999.

For some, it was small consolation. Huang Guangyu, founder of Gome Electrical Appliances Holdings and last year's richest man, was arrested in December for alleged market manipulation but still managed the No. 17 spot.

Rong Zhijian, who resigned as chairman of the huge conglomerate CITIC Pacific in April after a currency bet went wrong, fell from fifth last year to 37th and was probably the biggest victim of the financial downturn.

The number of Shanghai natives on the list dropped to 89 this year from 98. The city's richest man was Xu Rongmao, a property developer who ranked No. 3.

Despite the challenging times, the number of known US-dollar billionaires on China's mainland has grown to 130, up from 101 last year and none in 2003. And even that doesn't tell the whole story.

"You can double the real number of billionaires in China to 260," Hoogewerf said. "There are still a large number of billionaires off the radar screen, managing to build up substantial wealth away from the public spotlight from property, the stock market and investments."

The report said the property, manufacturing and financial investment sectors generated most of the wealth and that mining was the fastest-growing industry.

"Despite the greatest wealth destruction in the West in the past 70 years, China's rich are getting richer and putting the credit crunch firmly behind them," Hoogewerf said.

The urban population is expected to increase by 300 million people by 2025, laying the foundations for continued growth, the report said.


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