The rich lives of coal bosses

Just the thing for an energy magnate.

The Top Essence luxury goods show was held in Beijing over three days at the end of September. Borrison, the organizer of this and similar luxury expos in Shanghai and Guangzhou, invited guests from Beijing and surrounding areas.

According to a report in the Mirror, many of the guests were not what you'd expect:

Wiesmann sales manager Mr. Zhu was surprised: over three days he received a number clients who had Tangshan accents and who were interested in purchasing a 2.98 million RMB (US$400,000) Weismann automobile. They all seemed to be rich and powerful. In the minds of many people, Tangshan is at most a third-tier city. "How could Tangshan have so many rich people?"

[Borrison representative] Sheng Lei explained that eighty percent of the target consumer group for these luxury items came from Beijing; twenty percent came from four cities around Beijing: Shenyang, Dalian, Taiyuan, and Tangshan.

"I invited the guests from Tangshan. They're primarily in the energy industry," Sheng Lei said....He explained that he had expressly invited guests from Taiyuan and Tangzhan because those two areas have many private "magnates" in energy sectors (such as coal), and they have considerable purchasing power. Moreover, they live close to Beijing and like to come to Beijing to shop. On the eve of the expo, the sponsors chose Tangshan and Taiyuan for special media promotions in the hopes of attracting their target consumer group.

"They are enthusiastic buyers of luxury items, and they're potential purchasers of fine cars, high-end watches, jewelry, and real estate. Every year, at least thirty percent of Beijing's high-end luxury items are carried off to those four areas," said Sheng Lei. He explained that this was an estimate according to sales feedback.

On 21 September, an individual with an exclusive club in Changping, Beijing, said that even when faced with a US$200,000 entry fee, many Shanxi coal bosses still had a strong interest in joining. "I rejected them all. Money isn't enough! Members here have station and position."

Perhaps it's not so surprising in light of a report a few years ago that coal mine privatization in Shanxi was giving owners astronomical returns on small, government-assisted initial investments.

The expo itself was criticized for encouraging conspicuous consumption and for violating Hu Jintao's 8th Shame: wallowing in luxury.

Xia Yaozhou's planned community.

Far off in Tangtang, Yunnan, another rich mining boss has been in the news recently. Rather than spending his millions on luxury imports, Xia Yaozhou is trying to enrich the people of his village by providing them with jobs and homes.

Xia got his start working a carpenter while trying to get his mining business off the ground; he is now worth around 100 million yuan. He's invested 30 million so far in development projects for the village, including a pig farm in which all villagers are shareholders.

His goodwill is not universally accepted, however. According to reporters from Yunnan's Metropolitan Times, many people suspect that he has ulterior motives for building houses for the villagers and providing them with 10,000 yuan each in annual income. His business associates think there must be a profit motive somewhere; Xia protests that he just wants to bring wealth to his village:

When speaking of others' confusion over his decision, Xia Yaozhou says with a twinge of self-mockery, "They say I'm stupid, they say I'm an idiot! But I still think that I'm just a bit smarter than them!" When he says that last sentence, he is full of self-confidence.

"How can everyone can be well-off in developed countries, while in China, in Tangtang, we cannot achieve that? No matter what people think, I want the people in my hometown to make lots of money and live happy lives!" Such stirring words brought forth objections from a bystander: "This is completely at odds with the instincts of a businessman. Businessmen should take care of business. They don't even bother getting up if there's no profit in it!"

Indulgence in luxury is criticized as overly ostentatious, but generosity is distrusted. What's a coal boss to do?