Chinese business wave expected in five years

China may be more than seven thousand kilometres from Luxembourg but in five years the gap looks set to shrink.

According to Rupert Hoogewerf, author of the Hurun report listing China's 1,000 wealthiest people, a wave of Chinese private sector businesses is expected to flock to central Europe.

Speaking at a Chinese-Luxembourg Chamber of Commerce (ChinaLux) event on Thursday, he said: “The Chinese private sector hasn't yet come to Europe. They won't come for another five years but when they do they will come big time, that's what everyone is expecting. We've got five years in which to prepare and understand the market. That's worth bearing in mind.”

Mr Hoogewerf's speech, entitled China's Richest and their Connection with Europe, painted a fascinating picture of the changing face of wealth in China and the growing interest in Europe.

He explained that China now has more than 500 US dollar billionaires, of which 99 per cent are thought to be self-made.

“When we started the first Hurun list 12 years ago in 1999 most people imagined the top wealthiest Chinese would follow the power,” explained Mr Hoogewerf, adding: “But, what's happened during the last ten years people have changed their thinking a lot. There's a lot of successful entrepreneurs in their own right. There are no longer guys who got power from their parents, they're actually people who are canny and clever and are worth knowing more about.”

While a substantial shift in businesses from China to Luxembourg is not expected until around 2017, there are already a number of Chinese billionaires conducting business in Europe. In Luxembourg, the most well-known include Chen Rong of Zhonglu, who made motorcycle engine parts, and Guo Guangchang of Fosou, who now owns Luxembourg-based Club Med.

Business connections aside, for the majority of China's billionaires Europe is a popular destination for its luxury goods and education, explained Mr Hoogewerf. The UK remains the number one choice for billionaires sending their children to study in secondary schools abroad. UK universities are also a popular choice. France, meanwhile, is the first choice for Chinese billionaires shopping for luxury goods and gifts. Among their top five preferred brands mentioned in a survey by the Hurun Report, the first four were French.

Rupert Hoogewerf is a British national who grew up in Luxembourg and studied Chinese and Japanese in the UK. He now lives in China where he is well-known for founding the Hurun Report. His father, Francis Hoogewerf, is president of ChinaLux.

The speech was given at a dinner hosted at the Grand Ducal golf course on January 19.