A 74-story five-star hotel was inaugurated Saturday in Huaxi, often referred to as the "No. 1 Village Under the Sky" in China. The hotel is part of the village's plan to boost its tourist industry. Photo: CFP

A massive 328-meter skyscraper was inaugurated Saturday in Huaxi village, Jiangyin in East China's Jiangsu Province, marking the 50th birthday of the richest village in the country and making Huaxi the only rural village in the world with its own skyscraper.

The five-star hotel cost 3 billion yuan ($0.47 billion) to construct. Two- thirds of the funds were raised from 200 families in the village, each giving 10 million yuan. The proudest feature of the hotel is a one-ton solid-gold bull on the 60th floor, valued at 300 million yuan.

The super-tower is the brainchild of 84-year-old Wu Renbao, former chief of the village. "Beijing built the 328-meter-tall China World Trade Center. Huaxi wants to maintain the same height with the Party Central Committee," he said.

A 74-story five-star hotel was inaugurated Saturday in Huaxi, often referred to as the "No. 1 Village Under the Sky" in China. The hotel is part of the village's plan to boost its tourist industry. Photo: CFP

Path to wealth

Founded in 1961 with only 667 residents, Huaxi was a typical farming community in China. Total assets of the village, excluding a debt of 15,000 yuan, amounted to only 25,000 yuan.

Wu secretly set up a 20-worker factory in the village in 1969, mainly manufacturing screws. Such enterprises were banned during the Cultural Revolution (1966-76). Wu would disband the factory when inspectors arrived, sending everyone back to work in the fields.

The day after Deng Xiaoping proclaimed "getting rich is glorious" in March of 1992, Wu summoned the villagers at 3 am and proposed a 20 million-yuan investment in raw materials like copper and aluminum. In the weeks that followed, the price of aluminum ingots tripled from 6,000 yuan to over 18,000 yuan. Huaxi had moved on it first.

After decades of development, Huaxi has since swallowed 13 adjacent villages, increasing its area from 0.92 to 3.5 square kilometers. The village has become a multibillion-dollar conglomerate, operating as the Jiangsu Huaxi Group, with interests in steel, tobacco, textiles, property and logistics.

The sales revenue of 60 companies under the Huaxi Group topped 51.2 billion yuan in 2010, one tenth of the provincial capital Nanjing's GDP.
  
Now, every family from the original Huaxi core village has at least one house, a car, 6 million yuan in the bank, while enjoying universal health care and free education, according to media reports.

Fresh challenges

However, Huaxi now faces a stern reality. The proportion of income from its pillar iron and steel industry has fallen from two thirds to less than a third, due to rising material costs and falling demand, the Nanjing-based newspaper Modern Express revealed.

Last October, Huaxi leaders decided to shift its priority from an extensive industrial center to developing its tourist industry. The 3-billion-yuan investment in the skyscraper is part of the plan to boost tourism in the village.

Another 10 projects aiming to transform the village's industries, including a new airline and a shipping company, kicked off the ceremony on Saturday.

Peng Weifeng, a professor with the China Institute of Industrial Relations, said the launching of the new projects draws the curtain on a new era of Huaxi's development, and its industrial restructuring is promising.

Yuan Yang, a reporter who wrote about the village in 1978, feels confident about its future. "I have been watching Huaxi for 40 years. There was a certain inevitability to Huaxi's success. With a lot of young talented people, the village will develop better," he said to the Jiangyin Daily.

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Town critics

Apparently not all observers are so optimistic about Huaxi's future.

The British newspaper the Guardian considers it is impossible that the village will reinvent itself as a real tourist center as the only attraction and legend of the village is the 84-year-old Wu Renbao. It also criticized Wu for turning the community into a family fiefdom, in which workers receive no holidays, while his relatives get the best posts.

According to the Chinese news portal Netease, residents of the original Huaxi village enjoy dividends from the village enterprises every year and they are assigned jobs, houses and cars, but residents from the nearby villages that have been absorbed by Huaxi along with migrant workers receive nothing.

There is also a clear gap between the original residents, residents in adjacent villages, and migrant workers. If one wants to get a residence permit (hukou) in the central village of Huaxi, they must be recommended by the enterprise he or she works for and is then reviewed by the Party committee of the village. The quota is only two or three a year, according to Netease.

Most of the village's wealth is owned by the 2,000 original families. Over 25,000 migrant workers, half of the village's population, earn monthly salaries but they do not share in the village's wealth. Even the villas and cars of the residents from the original Huaxi village are in fact collective, and villagers do not have property rights. Once a villager leaves, he or she loses everything, Netease added.

The skyscraper, which was invested in by only 200 families, turned public land into a profitable property project for a few rich people, Netease also said.

Inimitable example

Huaxi village sets a model of the "socialist new village" across the county. Every day about 2,000 tourists, mostly cadres and retired people, arrive to see the miracle for themselves, according to Xinhua. However, intellectuals argue that Huaxi's example cannot be copied.

"Huaxi is no longer a village. It is an enterprise and eager to show its wealth," columnist Han Haoyue was quoted by Xinhua as saying.  

Zheng Fengtian, a professor with the School of Agricultural Economics and Rural Development the Renmin University, partially agrees with Han. He said that Huaxi's experience is inimitable. "Huaxi accumulated original capital by opening industry at the beginning of China's Opening and Reform. It is impossible for other villages to do so nowadays when facing fierce competition from big cities."