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Nov 29, 2021
For more than a decade, Jack Ma was more than a billionaire: he was a figurehead of communist China’s capitalist success, an icon whose stunning story, innovations and philanthropy turned him into a larger-than-life figure in the mold of Bill Gates. The former English teacher founded Alibaba in his apartment in Hangzhou in 1999 and by October 2020, the business had turned into an e-commerce behemoth with a value of $857 billion.
Then it all came crashing down. Ma disappeared for three months starting in October 2020 after publicly criticizing Chinese financial regulators who had stopped his fintech giant, Ant Group, from launching what at the time was expected to be the world’s largest IPO. Since then, Alibaba’s stock has crashed.
Today’s Daily Dose introduces you to the next entrepreneurs who could emerge as the face of Chinese business and how they’re adapting to Chinese President Xi Jinping’s broader crackdown on the country’s billionaires. Then, meet others around the world who have benefited from state capture . . . and those who have fallen like Ma has.
-Based on Reporting by Eromo Egbejule
1 - Liu Qiangdong
Over the past two decades, China has emerged as the world’s billionaire factory, minting the super-rich at a faster rate than any other country. In 2001, there was no entrepreneur from mainland China in the world’s top 100 billionaires. Today the list includes 20 Chinese billionaires. Just outside the top 100 is Liu Qiangdong, also known as Richard Liu, whose company JD.com is a direct competitor to Alibaba. But while Alibaba’s stocks have seemingly been in free fall, JD.com has seen its revenue steadily rise this year, marking a solid increase in the third quarter of 2021 compared with the same period the previous year. Yet Liu, whose net worth is just under $19 billion, has learned not to repeat Ma’s mistake.
In the beginning, her company was little more than a “garage band.” Today, Liu is the frontwoman of one of the Asia-Pacific region’s fastest-growing fintech firms, Airwallex, which in 2019 became the quickest company to reach unicorn status (achieving a valuation of $1 billion) in Australia. In the process, the 30-something China-born entrepreneur, who settled in New Zealand at the age of 12, has emerged as one of the most prominent faces of success among China’s vast expat community. Amid the pandemic, Liu has kept herself busy in the kitchen while dreaming of a Bali vacation. We wonder what’s cooking next.
State Capture “Experts”
1 - Iris Fontbona
The world’s 15th-richest woman, Fontbona heads a mining empire and also controls the majority stake of a Chilean national conglomerate that deals with beer, banking and manufacturing. She is worth an approximate $20 billion. But with fortune has also come scandal, and a lot of it. Over the years, her family, which controls Banco de Chile, has been accused of trying to influence top politicians — including former President Michelle Bachelet — in exchange for preferential treatment.
2 - Gautam Adani
Indian Prime Minister Narendra Modi came to power in 2014 promising acche din (good days). And he has certainly delivered them to 59-year-old Adani, a close corporate ally whose private jets Modi has used for political campaigning. In 2014, Adani was worth $7.1 billion and was India’s 11th-richest person. Seven years later, the college dropout is now worth $83.5 billion and is the world’s 24th-richest person (and India’s second-wealthiest). He’s been accused of receiving preferential treatment from the government, including an instance in which he was awarded the lease to operate six airports without having any relevant experience. That might explain why he’s flying high.
3 - Vincent Bolloré
The billionaire French industrialist holds interests in shipping, media and the oil sector across at least 10 African countries. The Bolloré Group has previously been accused of corruption, but things reached a crescendo three years ago. Its 69-year-old CEO was arrested and interrogated by French police over allegations that he had influenced elections a decade ago in favor of two longtime dictators in Togo and Guinea in exchange for business contracts. In March, a Paris court rejected a plea bargain agreement Bolloré had secured with French prosecutors under which he would only have had to pay a fine of $440,000.
4 - Aliko Dangote
Africa’s richest man — and the wealthiest Black man in the world — is building the world’s largest single-train oil refinery with a capacity of 650,000 barrels per day just outside Lagos, Nigeria’s commercial capital. It is the first foray into oil and gas for the billionaire, whose net worth of over $12 billion is derived from the conglomerate he founded, Dangote Group, which manufactures everything from sugar to spaghetti. But he isn’t new to greasing palms and lobbying, if critics are to be believed. A loan of $500,000 from his maternal uncle, a scion of one of West Africa’s richest families, got him started in business but since then, major help has often come in the form of tax waivers granted by the Nigerian government. In August, the state oil corporation announced it would invest $2.7 billion in Dangote’s new project.
Fallen From Favor
1 - Sergei Pugachev
He once owned a coal mine, shipyards and a multitude of other assets across the world. Pugachev was known as “Putin's banker,” a sobriquet he earned as a member of Russian President Vladimir Putin’s inner circle who had provided loans to the government. But things fell apart after Pugachev’s International Industrial Bank took a $1 billion loan from the Russian government amid the 2008 financial crisis. Since then, Pugachev’s assets have been frozen. The troubled billionaire now lives in exile in France, with both his Russian and French passports seized by a British judge and handed over to a law firm acting on behalf of the Kremlin.
2 - Xiao Jianhua
In what seemed like a scene from a movie, Xiao, one of the richest men in China, was taken from his Hong Kong hotel room in 2017 by men believed to be Chinese officials. Eyewitnesses say he was put in a wheelchair with his head covered. The Chinese-Canadian billionaire hasn't been seen in public since, even though a full-page ad appeared in a Hong Kong newspaper under Xiao’s name soon after, saying he was traveling for medical reasons. In the interim, multiple companies linked to him were taken over by Chinese regulators. Officially, the companies are being dismantled because they allegedly hid the identity of the owner using shell companies, prompting the crackdown. But could the real reason simply be that Xiao’s investment firms were becoming too big?
3 - Guo Guangchang
Six years ago, another Chinese billionaire also went missing — but just for four days. Guo, co-founder and chairman of Fosun International, which has investments in mining, tourism, football and other areas, had gone from a childhood in a poor fishing village to one of the country’s richest people. He even became a member of the Chinese Communist Party’s top advisory council, the Chinese People’s Political Consultative Conference. But in 2015, he was entangled in the party’s corruption crackdown campaign and was detained for investigations.
4 - Isabel dos Santos
For many years, the billionaire daughter of the former Angolan president was the richest woman in Africa, having made questionable fortunes from the country’s oil fields and by buying state assets. But then her father’s successor, João Manuel Gonçalves Lourenço, had apparently ordered an investigation into the dos Santos regime. Her assets were frozen, her Forbes billionaire status was quashed, and the entire family became pariahs. To add insult to injury, a court ruled earlier this year that she should return $500 million worth of shares in a Portuguese energy firm to Angolan coffers.
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