Huaxi, a town of two thousand people, is know as China's richest village. Those inside the gates have villas, cars and glamour. Outside, life's harder.


in HUAXI, Jiangsu, China

Party Secretary Wu Xie En (49) was a bit too generous. ,,When we finished building this hotel, we offered all residents of Huaxi a free night'', he says, sitting in a comfortable leather chair in one of the hotel's lounges. ,,That was taking it a bridge too far. These people from outside, they didn't know how to behave themselves in a five star hotel. They smoked in areas where it's not allowed, threw their cigarette stubs on the brand new carpet and took stuff home from the hotel rooms. Oh well, they cannot help themselves. Nobody ever told them about the proper conduct in luxurious hotels. We will have to teach them. Until then, we only allow people from inside the village into the hotel.''


Everything in Huaxi, a town at a hundred and eighty kilometers to the northwest of Shanghai, is about those from inside and those from outside the village.

The two thousand residents of the original Huaxi are the insiders. Their town core is fenced off from the expansions on the outside. Guards stand at each entrance. These insiders have the luck to live in China's richest village. Each family owns at least one villa and drives around in expensive sedans.

The outsiders are the 35 thousand people who live within the administrative borders of Huaxi but who do not share in the town's wealth. Twenty thousand of them are migrants from other parts of the country who are now working in the factories of Huaxi. The other 15 thousand are original residents of the towns in the area which have been incorporated by the affluent Huaxi and have been renamed as Huaxi 2, Huaxi 3 and Huaxi 4.

Zhou Li (34) gets out of her white Audi Q5 2 liter, straightens her hip Dolce & Gabbana sunglasses and takes a moment to think. Then the local Communist Party official starts to talk.

,,Yes, in Huaxi we also have to deal with an income gap just like the rest of China. Only here it is not a gap between rich and poor, but between just wealthy and super wealthy.''

Zhou is referring solely to the people living on the inside of the village fence. ,,The spirit of Huaxi is one of collectivism'', she digs up a line from her memory. ,,We share the wealth of the village among ourselves.''

And there's a lot to go around. Wu Renbao (85), the former Huaxi Party Secretary, founded the town's first factory in 1964. He made each villager a shareholder in the factory, which produced tools.

The local government then divided the factory's profits. A small part of it was given out in cash, the rest was spent on free goods for the villagers. Each family was provided with free homes and food throughout the year.


That system is still in place today, only on a larger scale. Currently the Huaxi Group owns sixty companies, ranging from steel factories to financial institutions. Last year, these companies had a combined revenue of 55 billion yuan. Total profits added up to five billion yuan.

It appears the town has trouble figuring out what to do with all that money. After all, all the insider residents have already been provided with villa's and cars, free education and health care and good pensions.

,,A few years ago we made a four billion yuan profit after taxes'', says the old Wu Renbao. Even though he passed on his position as Party Secretary to his son, Wu senior is still being honored by everyone in the village as their leader, the man who made them rich.

Wu: ,,If we just keep on buying expensive hand bags, wines and cars with our money, we are mainly helping European producers. It's better if we invest the money locally. That's why a few years ago we decided to build a 328 meters tall skyscraper.''

The building opened last year: a monument to Huaxi's wealth that can be seen from far away. And just in case someone still wonders how rich Huaxi is after seeing the skyscraper, there is a solid gold statue of a bull on the sixtieth floor of the tower.

,,The value of that bull alone has already increased by a hundred million yuan since we bought it'', Wu says proudly. ,,See how we are helping ourselves?''

Zhouling Du (60) works in the garden in front of her villa. ,,The home next door is also ours'', she makes sure to point out. ,,We paid five million yuan for it. Cash.''

She walks over to a tree on the lawn. Not to show how pretty it is, but to report how much it cost. ,,Thirty thousand yuan!''

This part of town looks as much like an American suburb as it doesn't look like a typical Chinese village. No dusty roads, shabby homes and old diesels crowding the streets, but large stand alone houses lining roads covered with perfect asphalt. Each villa has a garage for the BMWs, Mercedeses or Audi's. ,,My husband used to work in the plastics factory'', says Zhouling. ,,We are never leaving this place: life is improving each year. The old boss Wu takes good care of us.''

Money is what matters for everyone and everything in Huaxi. Wu's son, current Party Secretary Wu Xie En, tells proudly of the contest he organized. If anyone from anywhere in the world could show him a better town than Huaxi, he would award that person with ten million US dollars.


To remove any doubt about what the accepted definition is of being better than Huaxi, Wu adds: 'That means a town where each resident is richer than the people of Huaxi.'

Down the road from Zhouling lives 72-year old Sun Weihua. He used to work as a clerk in the municipal archives and can now afford to live in a villa. He sits smiling on the big leather couch in the big bright living room of his home. Behind him stands a classic phone with golden sides. In front of him, attached to the wall, a flatscreen tv that due to its enormous size cannot be missed.

,,We also own another villa not too far from here'', Sun says as if that's completely normal for a retired city clerk. ,,Life is not bad here.''

His neighbor, 50-year old Cai Yunhi, says he is just a 'regular employee of the steel factory'. But he too lives in a villa. ,,We own two million shares of the Huaxi Group'', Cai says while he carries his 2-year old granddaughter around the house. ,,The return on those shares is two hundred thousand yuan a year, enough to pay for this home.''

,,I don't think we have any billionaires here'', says the old Wu Renbao. ,,Only people with several hundred million. We follow the strict guidance of the Communist Party, which teaches us to serve the people. Here we serve the people by making them rich collectively. It's socialism Huaxi style. Even the poorest resident of our town is a millionaire That makes me happy.''

It takes only a few minutes drive to get outside the gated community that is the core of Huaxi village. Here the bubble of socialism Huaxi style is quick to burst. Past the steel pipe factory and not far from the power plant, Liu Jing Guo (46) stands on the side of a dusty road.

He lights up a cigarette. Liu is, in the vocabulary of the Party Secretary, one of the outsiders. He was born outside the gate, so he doesn't share in the collective wealth of the town.

,,You know'', he says, ,,I don't even care much about that. Let them build these crazy things like that ugly hotel skyscraper or these ridiculous villas. I don't care about their expensive cars. All I ask is for the inside Huaxi people to be honest.''

Over the last few months, the outsiders have voiced their grievances about the lack of improvements in their lives as employees of the Huaxi Group. They tried to take to the streets, but each time the authorities stopped them.

,,Huaxi does not give us what we are entitled to'', Liu says. ,,The town has gotten money from the central government to pay a pension to all the people of Huaxi, not just to those inside the gates. But they don't give us our money.''


Another frustration of the outsiders is the meager compensation which Huaxi pays to the farmers who have to give up their land for construction of new factories and villas.

Liu: ,,Huaxi bought the land for 275 yuan per square meter. Then the authorities provide the farmers with new homes, for which they have to pay 750 yuan per square meter. So you loose your land and you have to pay for that privilege as well: that's Huaxi for you. But whenever you dare criticize the policies of old Wu, you'll be arrested.''

Fear of arrest keeps most of the outsiders from saying anything bad. Like the grandma who sits in front of a shabby house with her granddaughter. She came to Huaxi from the northern province of Hebei with her son and his wife, who both work at the steel factory. Grandma watches their daughter.

Their home, a grey two story cube, differs like night and day from the villas of the insiders down the road. The woman, who refrains from giving her name, says 'at least our situation here is better than in Hebei'.

The local government promises each migrant worker in the factories of Huaxi their own version of the American Dream: they will get rich and get a villa.

'That will never happen', the grandmother knows. She is surprised anyone would actually take that promise seriously. 'All I know that will happen is that our homes will be razed not too long from now, to create room for another set of villas which will not be ours.'

The division between the insiders and outsiders makes Huaxi a reflection of what is going on within China as a whole. The national leaders say the growing gap between the rich and the poor is the single biggest problem for China.

The former Huaxi Party Secretary Wu Renbao has met these leaders more than once. ,,As long as not all Chinese are rich, Huaxi is not rich'', he theorizes in the dressing room of the local theatre where an audience of hundreds is waiting for him to explain how Huaxi became so successful. They are tourists and authorities from other towns in China. Wu tells them Huaxi is rich because the town shared the wealth from the get go. ,,Socialism in one sentence is happiness for the regular people'', Wu tells them.

In the dressing room he throws in another theory of his: ,,The facts here in Huaxi prove that communism is a good system. It serves the people and grows an economy which serves people, not money.''


Behind the villas of Dongling Zhou lie the hills of Huaxi. Along the top is a ten kilometer life size replica of the Great Wall of China. Midway down the hill there's a copy of the Statue of Liberty on top of a crumbling copy of the US Capitol. At the foot of the hill, next to an actual fighter jet, there's the Arc de Triomphe, almost as big as the real thing in Paris.

Huaxi built copies of these monuments to broaden the horizon of its citizens, who had to work hard and had no time to travel.

But nowadays, the insiders of Huaxi do travel in their own chartered airplanes. They've already been to Southeast Asia and North America. Europe will follow soon. All expenses paid by the Huaxi Group.

The monumental replicas in Huaxi now serve to broaden the horizon of the outsiders who can only dream of money and travel.


,,I promise we will educate these rural folk, one step at a time'', says Party Secretary Wu Xie En, still in the town's new five star hotel. ,,The original residents of Huaxi already have their villas. Now we want to help the others to get one as well. That is the kind of socialism we dream of.''