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How four generations of Chinese in Australia spend their wealth

By Barry Li - posted Monday, 31 July 2017


Being aware of the background of the four differing generations of Chinese immigrants in Australia helps to evaluate their different goals and desires, and thus informs of where each generations' purchasing interests may lie. When we talk about "Chinese consumers" or "Chinese investors" in Australia we are typically talking about buyers from the People's Republic of China, often referred to as "mainland" China. This is a distinction from Chinese people in Hong Kong or Taiwan, or early Chinese migrants to Australia.

The first generation of the "New Chinese" – the Chinese baby boomers – grew up experiencing harsh living conditions. The official statistics is that about 15 million Chinese died of food shortage during the early 1960s famine. This horrible childhood experience has resulted in most of this generation being economical and cost conscious. They've worked extremely hard during their life, but a healthy diet and regular exercise were not their top priorities. Many of the Chinese baby boomers, especially those from large cities, have accumulated tremendous monetary wealth while gaining a bigger health debt. They are therefore likely to spend a huge percentage of their savings on medical costs. Although most of them never have a chance to visit Australia in their life due to travel restrictions, they are now important consumers of Australian medicine and health food. If their child (most parents only have one due to the one-child policy) has migrated to Australia, parents won't hesitate to support them purchasing an Australian property with their lifetime savings.

While the Chinese Gen X were born during the Culture Revolution they grew up in the hopeful years. Those who received higher education either had a great career in China or travelled overseas to discover bigger opportunities. Gen X is considered a very lucky generation because when they went to university tuition was free. Moreover, when they graduated, there was no need to look for a job: back then the state guaranteed employment of all university graduates. Those who left China very early, however, missed out on the most significant growth in China, and therefore are generally not as wealthy as some of their peers who stayed in China until 2000. Because of age reasons, Chinese Gen X did not commonly come to Australia as students, but more likely as experienced professionals or investors. For them, spending their wealth on purchasing a property in Sydney is very easy. All they need to do is to sell one apartment in the centre of Beijing or Shanghai – last year worth about $2+ million Australian dollars.

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My generation of Chinese is called the 80-hou ("post-1980 born", equivalent of the first half of Gen Y in the western world). We had much better living conditions to the generations before and we witnessed massive change occurring in China throughout our childhood. In the cities, especially along the east coast of China, most children received a proper education, including a growing focus on learning the English language. We had lots of exposure to the Western popular culture along the way, such as Hollywood movies and KFC; so coming to Australia was still hard but not a completely unimaginable change. The amazing thing is, since my generation, more and more mid-class Chinese families are affording to send their children to study in expensive developed countries like Australia. International students have certainly contributed a noticeable fee to the Australian higher education department. Lots of private institutions (e.g. IELTS) have also benefited from the boom of the education demand that started with the 80-hou generation.

Last but not least, the 90-hou Chinese were born much wealthier than their parents' generation. To them, private motor vehicles and personal computers are normal household goods. They started using mobile phones and online shopping when they were very young, and while they might still be short in life experience they are not shy with disposable wealth. These new fancy restaurants in Sydney, serving the taste of the new Chinese around major campus areas, were not only developed for them but many of them are owned by them with funding from their wealthy parents. The 90-hou are much more business and technological savvy than the 80-hou generation, so a lot of them conduct side businesses being a daiguo while they study at university. As a daiguo they become a personal shopping agent for their family and friends – and normally with extension to all customers in China – for Australian made products like baby formula and fish oil. In this way, they not only consume Australian goods and services themselves, but they are also the bridge that links all Chinese consumers to Australia.

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About the Author

Barry Li was born in China a few years after the end of the Cultural Revolution, living there for 22 years before deciding to complete his higher education studies in Australia. Barry has a BA in Economics from the University of International Business and Economics (UIBE), Beijing, and a Master of Commerce degree from Macquarie University in Australia. He is the author of The New Chinese: How they are changing Australia.

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