SEATTLE — A flourishing economy has brought success and wealth to China in recent years, yet historically the country has fallen painfully short in areas of charitable donations and philanthropy. Over the past few years, however, non-profit work and an increase in Chinese philanthropy have sparked a new trend in giving that has the potential to significantly improve development efforts in the region.
By the end of 2015, China was home to the second largest population of billionaires in the world, ranking just behind the U.S. As the Chinese economy has experienced rapid growth, the number of well-off individuals within China has risen dramatically. Just ten years ago, there were no billionaires living in China and in the past year alone the number of billionaires in the country has risen 38 percent.
Despite this rapid increase in wealth, China has consistently ranked among the lowest in the world in terms of philanthropic efforts. In its World Giving Index, Charities Aid Foundation ranks countries by the average percentage of people in each country who donate. In 2015, China ranked 144th out of the 145 countries included in the index. While 12 percent of U.S. GDP goes towards charity, just 0.17 percent of China’s GDP is donated.
Recently, however, an increase in Chinese philanthropy has been seen across the country as a shift in attitude towards charitable donations helps to bring the country into a more altruistic place. In the past five years, the number of non-profit organizations and charitable foundations has increased by more than 60 percent.
Increasingly, companies and private individuals alike are expressing a willingness to contribute to national as well as international initiatives particularly in areas that have been historically politically sensitive in China, such as public health and environmental protection.
Much of the shift has been attributed to a generational change within China. Most of the country’s billionaires are now in their 40s or early 50s and have made their money in the young, booming tech industry.
“With a new generation of Chinese who feel grateful for the opportunities the country’s growth has provided, social consciousness is rising, contributing to a growing urge to give back in innovative ways and to contribute to the nation’s future and to the betterment of our society” says Zhang Xin the co-founder and chief executive of SOHO China, the largest prime office real estate developer in China.
The government is also stepping up to encourage this increase in Chinese philanthropy. In March, it passed a new Charity Law which promotes transparency within the non-profit sector and makes it much easier for companies and individuals to donate since historically a maze of bureaucracy and red tape has kept philanthropic efforts from being what they could be. The new law, the first of its kind in China, is expected to significantly improve charitable donations.
As one of the world’s largest and fastest growing economies, China is in a position to make a considerable difference in development assistance particularly as the country becomes more inclined to donate to a variety of causes.
Currently, much of the increase in Chinese philanthropy has gone towards helping the less fortunate within the country itself. This has the potential to have a positive effect far beyond China’s borders. The number of impoverished people in the country is reduced and thereby we see a different outlook on extreme poverty. The market of consumers looking to buy goods from all around the world has increased as well.
As non-profit work becomes a global enterprise the opportunity arises to make a concentrated, globally reaching difference in ending poverty and improving the world.
– Sara Christensen