Dateline: Kuala Lumpur, Malaysia
New York is no longer home to the most billionaires in the world; and while it only fell to second place, the new ranking is a signal of a shifting world economy.
One that is making a clear shift to the East.
According to the Global Rich List compiled by the Hurun firm, Beijing, China is now the billionaire capital of the world with 100 billionaires — having added 32 new billionaires in 2015 alone.
China had a total of five cities among the top ten cities for billionaires, including Beijing, Hong Kong, Shanghai, Shenzhen and Hangzhou. Since 2013, China has increased its number of billionaires by 80%.
In fact, despite volatility in the Chinese stock market and the country’s “slowing” economy, China now has more billionaires than any other country in the world. There are now 568 billionaires in China, while the US has a total of 535 — with 95 residing in New York.
Coming in third place among countries was India with 111 billionaires, followed by Germany and the UK (tied for fourth with 82) and Russia (80).
Another revealing find in the report is just what has made these billionaires so rich. For the third year in a row, technology tops the list as the key source of wealth. Other top sources include real estate, manufacturing, and investments.
Why the shift to the East?
So why are places like China and India doing so well, and especially in just the past few years?
For one, they have large populations with a growing middle class. Secondly, there is an ever-growing interest in the internet in these countries. And, especially in the case of China, there is a healthy drive to become as strong as (and even replace) the US as the world’s economic leader.
Most importantly, these countries have created environments open to starting a business.
In many ways, China’s drive and specific brand of capitalism has worked very well for the country. As its financial center, Hong Kong is increasingly off-limits to foreigners, especially Americans, and they’re still doing well. In fact, the more they focus on their Chinese audience, the better they do.
They are doing so well that Hong Kong no longer needs to cater to people who fly in from the Uk or the US for just a weekend. The average Chinese person who goes to Hong Kong to do business has much more money and is an easier fit. Which is why it’s becoming more and more difficult to do business in China as a foreigner.
Is there a place for the West in the East?
However, that does not mean that you cannot take advantage of the strong, growing markets in China, India or any other emerging country.
In the book, “The 10 Trillion Dollar Prize”, the authors discuss the growing middle class in the East and analyze the mistakes western companies make when they go to China or India. One of the biggest mistakes is simply failing to understand their cultures, especially in China, and adapting accordingly.
I’ve told the story before of Nabisco’s efforts to sell Oreos in China when they decided to sell the cookies in the same packages used in the US. For the Chinese, the package was too big and too expensive, and the cookies were too sweet. However, the problem wasn’t entirely with the product, Nabisco just needed to adapt.
China is certainly not off-limits to westerners willing to adapt as needed. In reality, China’s success doesn’t come from innovation. Their economic model is based on taking what has worked elsewhere — mainly the West — and copying it. That is the trend in China for creating successful businesses and, obviously, it has worked for them so far.
We’ve discussed before that one of the simplest strategies for creating a billion-dollar company in Southeast Asia is to copy already successful businesses from the West. So don’t think that because you’re a foreigner you can’t take advantage of the incredible growth of Asia’s economies. What you have to offer may be exactly what they want.
Two lessons from the billionaire capital
Lesson Number One
Wealth and the global economy, in general, are shifting to the East because there is more room for growth there, creating more opportunities.
Western or otherwise, businesses in these emerging markets are growing faster than your business for reasons as simple as rising demand.
Also, realize that China may be the new billionaire capital of the world, but it is not your only option. Don’t worry if it is not the best fit for you in terms of culture or other factors. There are plenty of countries to choose from. The lesson to be learned is that in these countries where people are following a Western model, businesses are becoming more and more successful.
That’s the kind of direction the world is taking and you can take advantage of it.
Lesson Number Two
Don’t make excuses about the situation in “your country”. Countries may have borders, but you don’t.
I often talk to people who feel restrained by their circumstances, whether they include the business atmosphere in their home country, their government, family or cultural obligations, or any number of limitations.
The majority of these people recognize that there may be something better for them in another country. And they’re right. Not only can you remove yourself from many of the limitations you are facing by going beyond your borders, but you also open yourself up to greater opportunities and new cultures that can teach you a better business mindset.
In an age of globalization, there’s no reason to make excuses. The biggest limitations to attaining greater wealth are the excuses you tell yourself. The number of billionaires in the world increased by 50% between 2013 and 2016, clearly, the opportunities are still out there.
If you are ready to capitalize on those opportunities, apply here for a consultation and we can design a blueprint that will ensure your future success.