A Nongfu Spring store in Shanghai on March 13, 2024. Chinese beverage giant Nongfu Spring is the latest major brand to come under fire from the mainland’s online army of nationalist citizens, underscoring challenges for domestic firms navigating an increasingly patriotic environment. Photo: Bloomberg
Opinion
Lijia Zhang
Lijia Zhang
Why Nongfu Spring’s online attackers are no Chinese patriots
Claims of Nongfu Spring being pro-Japanese are risible and attacks on the drinks company and its founder Zhong Shanshan only damage the country and its economy
As a success story of Chinese private entrepreneurship, the company should be celebrated, not pilloried
Zhong Shanshan, China’s bottled water king, remains the richest man in China, according to the Hurun Global Rich List 2024. But few people in China, it seems, are in the mood for congratulations.
The rich list came out last month, right after Zhong, the founder of Nongfu Spring, found himself caught in the eye of an internet storm. A large number of nationalist internet users in China had attacked him, accusing his firm of, among other things, having pictures of Japanese religious buildings on its packaging. A boycott followed and the company’s Hong Kong-listed shares lost as much as 8 per cent last month, though have since recovered.
I am not surprised that few Chinese internet users are happy for Zhong; as some have put it, what has Zhong’s status as China’s richest man got to do with them? It is also understandable that, with China’s economy struggling, people find themselves unable to muster much sympathy for Zhong – his immense wealth is estimated at US$63 billion.
The rich are so widely despised in China that there is even a term chou fu – resenting or hating the rich – to describe the feeling. Many believe the rich obtain their wealth through unfair means, such as personal connections or corruption.
But I believe attacking Zhong or boycotting his products is unreasonable and unwise. It is a move that is bad for China’s economy and the attackers themselves.
Zhong Shanshan, China’s richest man and the founder of Nongfu Spring. Photo: Nongfu Spring
Zhong’s “rags to riches” story is inspiring. In 1996, he established his company, a private firm, in his hometown of Hangzhou. It slowly grew to be the largest bottled water company in China. In 2020, the company went public on the Hong Kong stock exchange, which suddenly made Zhong extremely rich.
The online denunciations of him have so far failed to produce any evidence of actual wrongdoing. If he has not violated any law, he should, at the very least, be left alone. What would those nationalist trolls hope to see? The collapse of his company? More than 20,000 employees losing their jobs?
For me, the Nongfu Spring saga points to the fraught relationship between China and its entrepreneurs. Let’s face it – the Communist Party has never had an easy relationship with private enterprise. Running one’s own business was illegal for many years under Mao Zedong.
After Deng Xiaoping gingerly introduced economic reforms, he allowed getihu – individual entrepreneurs – to set up their own businesses. “To get rich is glorious,” as the saying went. However, Chinese society was still unsure about such people. My mother thought she had degraded herself after she retired from a state-owned enterprise (SOE) in the early 1980s and started work as an administrator at a local market, collecting fees from getihu.
These private businesses started small, but gradually they grew and played an increasingly vital role in the economy, so much so that in 1999 China amended its constitution and acknowledged that the private sector was an important component of the economy rather than a mere complement to the public sector. To this day, however, private enterprises are subjected to discriminatory treatment in terms of taxation, market access and restrictions on bank loans. Banks in China prefer to lend money to SOEs.
Remarkably, private business rose out of this not-so-fertile ground and proliferated throughout the country. In a speech at the Private Enterprises Symposium in 2018, President Xi Jinping pledged support for entrepreneurs. By then, the private sector was providing more than 50 per cent of the tax revenue, 60 per cent of economic output and 80 per cent of employment in China.
Even so, the private sector is facing unprecedented challenges. While Beijing has promised to improve the operating environment for private businesses, few have benefited from it in recent years. In fact, the opposite seems true.
The share of China’s private sector among the country’s 100 largest listed companies has fallen from 55.4 per cent in mid-2021 to 36.8 per cent at the end of 2023, according to a study by the Peterson Institute for International Economics. The Covid-19 pandemic and the crackdown on the tech sector are likely drivers behind the fall.
Xi’s “common prosperity” strategy has also caused fears that the authorities could tighten control over the private sector. Already, large companies have been pressured to make “voluntary donations” towards Xi’s vision. Tencent and other tech companies have duly complied.
I believe the government’s ambivalent attitude towards private enterprise gives a lot of space to nationalist trolls. If Beijing is sincere about putting its weight behind the private sector to revive the economy, then it should stop the boycott against Nongfu Spring.
Trashing the business simply because it is successful is wrong. Nongfu Spring is one of the country’s most successful domestic brands. We should all cherish it, and any private enterprise that generates tax revenue and provides employment should be encouraged. How well the private sector fares has a direct impact on China’s economy and its stability.
I am pleased to see that some disagree with those nationalist trolls. They are appalled that the attack was carried out in the name of “patriotism” and said such behaviour was hindering China. A true patriot is someone who puts the national interest first. Attacking a home-grown brand for no good reason is not patriotic.
Lijia Zhang is a rocket-factory worker turned social commentator and the author of a novel, Lotus
