Huaxi in east China, is a mysterious socialist town that once believed that the residents were entitled to extraordinary amenities, including free healthcare, education, luxurious homes, cars, and at least $250,000 in their bank accounts. The so-called richest village in China is now running into debt with villagers waiting in the rain to claim their money back from Huaxi. 

The village is administered by Jiangyin city in Jiangsu Province, a coastal region traditionally known for its abundant agricultural resources and beautiful landscapes.

The rural farming village was transformed into 10 steel, iron, and textiles corporations by Wu Renbao, the former secretary of the Huaxi Village Communist Party Committee.

He put Huaxi on China’s stock exchange in 1998. However, in 2008, business began to decline and fell into a state of oversupply. 

Corporation leaders looked for new opportunities in the financial industry, engaging in banking, securities, insurance, and stock. They also expanded to the internet such as game online and mobile services. None of that transition was successful. Investments and emerging industries cannot compensate for losses incurred in traditional industries but also increase operating costs. In 2017, Huaxi Group owed more than 40 billion yuan making shareholders’ dividends fall from 30% to 0.5%.

The actual value of Huaxi’s debt could be as high as 30 trillion yuan ($4.14 trillion) if you include debt from these local companies, which they use to raise capital.

Huaxi was famous for a 72-story skyscraper, helicopter taxis, and row upon row of lavish villas. It is also known for a hotel containing a $15,000-a-night presidential suite and an ox statue made of gold. However, some people have challenged its centralized system, suggesting its prosperity was a hoax. 

Business Insider posted an article showing some unusual things in Huaxi. It’s said that if you leave Huaxi, you lose everything. A lawyer named Yuan Yulai from the Zhejiang Zhixing law firm told AFP, “Even if villagers do get rich, they can’t take away their personal assets when leaving the village, so it’s doubtful whether the assets belong to the villagers.”

No matter where you are, Huaxi’s theme is hard to escape since the village song is broadcast everywhere over megaphones and loudspeakers, “The skies above Huaxi are the skies of the Communist Party, the land of Huaxi is the land of socialism.”

There are also a few clothing stores, some low-budget restaurants, and a few noodle houses. What’s strange is that in a village that brags about being the richest in all of China, there are very few stores that cater to the wealthy.

Chinese state media has used the village to prove the success of the leadership of the Communist Party but the truth is, it is exposing itself in the end.

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