2012-03-19

China's miserable millionaires

You'd think with the economy growing at 8% or more and incomes rising, in a country where the poor are still by far the largest income group, the middle class would be happy. Instead there are articles such as "Sad millionaires" (悲催万元户), lamenting the high cost of homes and automobiles, including rising fuel prices. Just as the "Chinese dream" seemed within reach, it moved farther away on the back of rising prices.

By Chinese standards, ¥10,000 a month in salary places one firmly in the middle class, yet this can not even buy 1 square meter of property in the big cities. Rising fuel costs and taxes/restrictions make car ownership very difficult and fuel costs alone could easily eat up 10% of gross income. In the 1980s, this salary qualified one as a "millionaire" by Chinese standards, but today it means one feels as though they are just out of poverty. Only 5 years ago, this salary was enough to buy a nice house, but no more. Even though their salary is multiples of the ¥2,500 to 3,000 that minimum wage earners might pull in, they can't really afford that much more because rising inflation places homes and better education out of reach, while food and energy costs chew up their disposable income.

No comments:

Post a Comment