Retailing king tops list again

Huang Guangyu

Huang Guangyu, chairman of Gome Electrical Appliances Holdings, was named China's richest man for a second year with a fortune of US$1.7 billion ($2.45 billion), according to an annual ranking of the country's wealthiest business people.

Hurun Report, which compiles the China rich list, said the founder of China's biggest home-appliance chain increased his wealth by 30 per cent from US$1.3 billion in 2004 after selling shares in his Hong Kong-listed company. Huang, 36, also invests in real estate.

The number of billionaires on the list jumped to seven from three, in a nation where the transition to a market economy is widening the gap between rich and poor.

"Although there is an increasing rich/poor divide, many of China's richest entrepreneurs are also increasingly giving back to the community," Rupert Hoogewerf, who has compiled the list since 1999, said.

The top 10 richest business people paid US$750 million in taxes last year and employed 300,000 people, Hoogewerf said.

Several high-ranking tycoons were investigated and subsequently jailed when former Premier Zhu Rongji "unleashed the tax authorities" after noticing the 2001 list, said Forbes Magazine, which formerly published Hoogewerf's study.

The jailing of businessmen such as Chinese-Dutch flower baron Yang Bin (ranked second in 2001) and Shanghai real estate magnate Zhou Zhengyi (ranked 11th in 2002) underlined the precarious nature of private wealth in an economy where corruption is rife and legal protections remain undeveloped.

Yan Jiehe, 45, head of privately owned China Pacific Construction Group, ranked second in this year's list after he increased his fortune more than sevenfold to US$1.5 billion.

Chen Tianqiao, 32, founder of Shanghai-based Shanda Interactive Entertainment, was third with wealth of US$1.45 billion.

Gome's Huang, known in Hong Kong as Wong Kwong-yu, left his native Guangdong province when he was 18, armed with a bag of cheap plastic home appliances and rented a market stall in Beijing.

Today Gome operates 188 shops in 42 Chinese cities. The company said its net income rose 176 per cent last year to HK$458 million ($84.7 million).

In June last year, Huang sold 65 per cent of the retailer to his Hong Kong-listed property company China Eagle Group and renamed it Gome, in what local investors call a back-door listing.

He cut his stake in the company in December.

Yan's China Pacific Construction, which has contracts from China's city governments to build highways, is the country's biggest private employer with 100,000 staff.

Chen, a former student at Shanghai's Fudan University, scraped together 500,000 yuan with friends to co-found Shanda in 1999, aiming to create online computer games for China's 100 million-plus teenagers.

Shanda's shares, which trade on the Nasdaq, are worth US$24.06 but have lost 43 per cent this year.

The average wealth of the top 100 people on the list jumped 48 per cent to US$440 million, from US$297 million last year, the report said.

The combined wealth of the 400 people listed, expanded from 100 last year, was US$75 billion.

The 400 people on this year's list had average wealth of US$187 million.

- BLOOMBERG