Patrick Collinson finds film stars, dissidents and animal experimenters in China … but most of all, billionaires
I thought leasehold was a quaint British invention exported to parts of the empire but abandoned by most and well past its sell-by date here. But in China, leasehold is everywhere; one of the last relics of the communist system is that all property remains in public hands. Proudhon would be proud. But in a room of potential British property investors, the gasps were audible. Er, what? Do you expect us to invest in a property company that doesn't actually own any freeholds? It turns out the Chinese government grants leases of only 40 years on commercial properties, and 70 years on residential homes. Some of the early leases granted soon after the "open door" to the west now have less than 20 years to run. After that, it all reverts to the Chinese state, the world's biggest freeholder. But our hosts were unfazed. The Party, they assure us, will at some point change the law and you'll be allowed to keep your property, maybe with a small extra tax. Given that one of our hosts is a senior apparatchik in the Chinese Communist party, we should probably take his word for it. It's the fact that he's also a managing director of Morgan Stanley, that most blue-blooded and waspish of Wall Street investment banks, that is perhaps more puzzling.
• BXL is on everyone's lips. Or B.X.L. or B...X...L. It stands for Bo Xilai, and it's how Chinese people skirt the censors to talk and report news on Weibo, the Twitter-meets-Facebook app that dominates social media in China. Censorship has turned into a cat and mouse game: the colossal machinery of state repression that still exists in China has run up against the 300 million users of Weibo. The site is less than three years old and is probably the biggest and fastest-growing internet sensation in the world. Ultimately the state can simply switch Weibo off, so the company itself is as keen as the censors to keep BXL off the site. But a consequence of the one-child-only policy is that young Chinese are addicted to social media. When no one has a brother or sister, Weibo fills the gap. Switch Weibo off and you're guaranteed to provoke a riot – as the infuriated Chinese authorities are already keenly aware.
• It's Yao Chen v Lady Gaga. In the English-speaking world, Lady Gaga has the most followers on Twitter, at 25 million. In the Chinese-speaking world, it's Yao Chen, with 16 million followers (on Weibo), but growing faster. The 32-year-old actress was first spotted by Chinese studio bosses in An Lian Tao Hua Yuan (Secret Love in Peach Blossom Land) and was, I guess, unmissable in Culinary School Story. Given China's population of 1.4 billion, she's probably the most famous person on the planet. Hu Jintao, China's president, is concerned that the country's social and cultural power doesn't match its economic might. Expect to hear more from the likes of Ms Chen.
• In 25 years of financial journalism I have lunched two, possibly three, dollar billionaires (they never taste good). There are believed to be 33 in the UK and 115 in China, but my guess is that it's a lot higher. In Beijing and Shanghai I met four in four days. One even served me lunch, thankfully not spotting the noodle soup I spilt on her Bottega Veneta bag. Pan Wei started Ajisen, a Japanese-themed budget restaurant chain in Hong Kong 18 years ago. Now she has 670 restaurants, and like all the billionaires I met, still retains nearly 50% ownership of her company. The winner-takes-all capitalism that funnels the rewards of globalisation up to the 1% is as demented in China as it is in the west. But unlike Russia's billionaires, whose fortunes were pocketed largely through the theft of state assets, many of China's are entrepreneurial. Strikingly, they are also female. In Beijing I met Zhang Xin, a self-made billionairess – she started as a factory worker in a garment sweatshop in Hong Kong at the age of 15 – who is to China what Richard Branson is to Britain. You might wonder why these global billionaires were queuing up to dine with the editor of a personal finance section. They weren't. It had more to do with who sat next to them at lunch; not me, but Anthony Bolton, president, investments, of Fidelity International (the world's biggest investment management group), who invited us hacks to China. Like the rich everywhere, it's money they talk to, not the Money section.
• In public, Chinese policymakers have put tackling corruption at the top of the agenda. In private, it remains endemic. Often the form it takes is called guanxi, which roughly translates as "connections" and "relationships". I met one woman who owned a large factory in the interior. To obtain the required building permissions and grants, she pays for the daughter of the city's mayor to attend a private school in Australia. This form of petty corruption is, I'm told, so widespread in the country it's barely seen as worth reporting on.
• Is China a place where the west hides what it no longer wants closer to home? The road from Tianjin to its airport is unforgiving in its industrial desolation. A flat, grey, horrifically polluted landscape of giant factories. One of the biggest? With cruel irony, it's a Vestas plant, assembling wind turbines and blades that we in the west think will tackle climate change. Meanwhile, on the edge of Shanghai is the global centre of animal testing. The boss of Wuxi Pharma Tech almost gleefully tells us of the thousands of dogs and monkeys it slaughters in the name of drug research. All the major western pharmaceutical companies now outsource testing to Wuxi ("We do it 50% cheaper than the UK!" he exclaims), which probably wasn't the outcome protesters against Huntingdon Life Sciences had in mind. The boss laughs about protestors. "If you do that here, I'm putting you in jail right now."
Patrick Collinson was a guest on a trip organised by Fidelity Investments. Fidelity's China Special Situations investment trust is a holder of shares in Ping An, Master Kong and Wu Mart.