Tycoons in emerging economies had greatly increased since 2004 from 20 percent of the billionaires in Forbes magazines annual survey to 43 percent in 2014. The truly rich entrepreneurs—the self-made ones rather than those who inherited their wealth—had also increased between 2001 and 2014 from 56 percent to 79 percent of the billionaires in emerging economies, overtaking those in the rich world, where their number had remained stable at about 60 percent during the same period (source: The Economist dated April 2, 2016 Tycoonomics).
The emerging economies include China, Taiwan, India, the Philippines among some, where there are several entrepreneurs who started out with relatively small capital but with innovative spirits that have driven their businesses to grow into mega firms. And personally I think, and I agree with the article above, that the rise of these people to the top in emerging economies did not result in a further widening of the gap between rich and poor. It is because they—ordinary people who became rich—responded in innovative ways to a world growing at such a fast pace.
The study that was included in The Economist article mentioned above, conducted by Caroline Freud, entitled “Rich people, Poor Countries: The Rise of Emerging-Market Tycoons and their Mega Firms” mentioned policy challenges that every country needs to tackle to minimize, if not to totally eliminate, the burgeoning rich-and-poor inequality. But I agree with the observation that inequality is more apparent in rich countries where the poor get poorer rather than in emerging economies.
Let me clarify my statement—a person who sees an opportunity and responds to this opportunity by creating something that will cater to the needs of a growing environment is likely to be be successful. A typical example is Zhou Qunfel, who, prior to starting her own business, was a factory worker in Guangdong. Eventually she started setting up her own business, Lens Technology, a manufacturer of touchscreens. She was born in 1970 to a poor family in Hunan province in China and became a migrant worker in Shenzhen, where she also studied. From making watch parts as a factory worker, she developed touchscreens that later, in 2001, won for her company a contract to make mobile phone screens.
Hers is a real rags-to-riches story that is based on hard work, and most importantly, sensitivity to the needs of an emerging economy and a global environment spurred on by rapid developments in technology. She is one of the young billionaires who account for the amazing increase in the number of billionaires from emerging economies that made it to the Forbes list.
The increase in their numbers should excite us. The stories behind their success show one common factor: innovativeness. When their economies started growing, they responded by creating innovate products that catered to people’s needs. Who would ever imagine in those days that touchscreens would become popular, or online purchases such as through Alibaba would prove to be more convenient for many consumers?
Not only did the owners of these dynamic companies become rich; their executives also gained wealth along with them. And it is heartening to know that they became truly rich not because they inherited a fortune from somebody, or they had strong connections in politics that helped them accumulate vast amounts of money, but because they actually responded to an existing need in the market and competed with other entrepreneurs to gain their rightful share by investing their time, talent and even their whole life to remain at the top of their game. And now they seem to be enjoying the fruits of their hard-earned success. The money may have become a secondary driving force, though it certainly remains a strong motivator, too.
Wilma Miranda is the Chairperson of the Media Affairs Committee of FINEX, Managing Partner of Inventor, Miranda & Associates, CPAs and Treasurer of KPS Outsourcing, Inc. The opinions expressed herein are the views of the writer and do not necessarily reflect the views and opinions of these institutions.