Sudden Changes in `Major Possessions` of the Chinese

The first and second most treasured properties among the Chinese in the end of 1970s were bicycles. They were intimate means of transportation and also making a living, so the Chinese government even levied tax to bicycle owners. Watches and sewing machines were also regarded valuable possessions due to scarcity.

However, after 20 years since reformation and opening, the manners and customs changed entirely. ‘Fortune’ US reported that the Chinese peoples are getting more enthusiastic about mobile phones and cars with expansion of freedom to move and rapid elevation of income.

This trend comes into view vividly when you look at ‘100 listed companies in China’ that are selected by Nomura Securities Japan and the ‘Fortune’.

The 1st and 2nd in sales were revealed to be two major national enterprises ‘Sinopec Petrochemical Corporation (Sinopec Petroleum & Chemicals)’ and ‘Petro China (the largest affiliated company of Sinopec Petrochemical Corporation), but the following 3, 4, 5th were all communication service businesses. Among newly listed 13 companies, 8 of them are communication service or equipment related companies.

In particular, the rapid advance of ‘Chinese Mobile Communication’ that marked 3rd is the event that symbolizes change in ‘Chinese consumption’. The net profit of this increased 17% compared to the value last year, and earned 13% more in the first half of this year (2.1 billion dollars) compared to the same period last year.

The number of subscribers reported by the company last week was 130 million, end of June as standard. The sudden increase shows well in the figure, 1,141 more. Mobile phone using time in the first half of the year is 161.9 billion minutes also 33% higher than last year.

As for cars, the summary sheet by Fortune presented the largest listed company Chang An Vehicles was ranked no higher than 33rd. However, the statistics misses collaborated foreign companies that invest hundreds of millions of dollars every year such as GM, Volkswagen, Toyota, etc.

The car sales passed over 1 million for the first time, and the number of vehicles sold this year increased rapidly, 85% higher than the figure last year.

For example, the Chinese government is restricting vehicles passing in Shanghai by auctioning limited number of license number plate with explosive increase in number of cars that resulted in severe traffic jam.

Still, only 1 out of 100 Chinese owns a car, which means vehicles are still regarded an index of wealth in China.

Rae-Jeong Park ecopark@donga.com