2009 Report On Charitable Donations In China Finds Local Donations Up, Education Most Popular Sector

    Though some in China consider wealthy individuals like Chen Guangbiao "crazy" for spending their fortunes on charity, philanthropy is becoming not only a more accepted activity in China, it's becoming something of a status symbol and a way of life for the urban elite.
    Jing DailyAuthor
      Published   in Finance

    Total Amount Down 68.9% From 2008, Year Of Devastating Sichuan Earthquake#

    Despite being relatively new phenomena, attitudes toward philanthropy and charity work have changed quickly in China, particularly in the wake of the massive 2008 Sichuan earthquake. As Jing Daily recently pointed out, this year the first-ever China "Soul-Rich List" celebrated individuals who have made a positive impact on Chinese society. Among figures such as Yuan Longping, whose advancements in the development of hybrid rice has given him almost godlike status in China, was Chen Guangbiao, the philanthropist and president of Jiangsu Huangpu Renewable Resources Company who recently raised 43 million yuan (US$6.3 million) for poor families in Guizhou, Sichuan and Yunnan, Tibet and Xinjiang -- 3 million yuan coming from Chen and the other 40 million from 127 entrepreneurs. As the academic Wang Jian recently said, though some in China consider wealthy individuals like Chen "crazy" for spending their fortunes on charity rather than real estate or Rolexes (although they certainly do that as well), philanthropy is becoming not only a more accepted activity in China, it's becoming something of a status symbol and a way of life for the urban elite.

    This week, the China Charity and Donation Information Center released its 2009 Annual Report on Charitable Donations in China, looking at the total size of donations that came into the country, the percentage of overseas donations, the donations given to different charitable sectors, and the types of donors. According to the excellent China Philanthropy blog, although the donation total for the year decreased more than 68% from 2008 on account of that year's Sichuan earthquake, "Chinese are giving more than before and are even overtaking overseas giving." From China Philanthropy's analysis of the report:

    Total Donation Size Decreased 68.9% from 2008

    "...According to the report, the total size of donations given last year was US$4.87 billion, a decrease of 68.9%. This drop becomes less shocking, however, when we consider the giving in 2007, a year in which there were no significant disasters. Comparing 2007 and 2009, there is actually an 8.2% rise in donations, which shows that general giving has increased since 2007 and that the economic downturn did not significantly affect donations.

    Another interesting discovery in the report is that more than 60% of the donations were given in the second half of the year. Normally, there is no significant difference between giving in the first half of the year and the second. I think the main reason for this is the severe drought that hit Southern China in the fall of 2009 (and continues today), which stimulated local giving."

    Overseas Donations Only Accounted for 14.1% of the Total Donations

    "An important finding in our last post was the encouraging trend that local giving has begun to overtake overseas donations. The new data from the 2009 whole year report confirms the trend. Overseas giving in 2009 accounting for only 14.1% of the total donations in 2009 versus 28% in 2007. As the year progressed, overseas donations plummeted as the economic downturn took hold in the West."

    Local Donations: The Portion of Individual Donations Kept Rising

    "Another exciting finding in the report was that local individual donations were higher than at any other time in history and actually rose over the course of the year. Charitable donations from individuals in 2009 accounted for nearly one-third of the total local giving. Before 2008, this portion had never exceeded one-fifth of total donations...The question now is whether or not this positive trend will last and what it will take to keep the levels rising consistently..."

    Charity Sectors: Education Received the Most

    "The education sector received the most donations with 41.1% of the monitored funds followed by disaster relief (25.5%), poverty (12.1%), health care (9.2%), environment (2.3%), and science and arts (1.5%).

    "In conclusion, after the boom of charitable giving in 2008, the donations in 2009 went back to a normal level. Although the total donation size decreased significantly last year, I am excited to see that Chinese are giving more than before and are even overtaking overseas giving. As the weight of individual donations continues to rise, I believe we are looking towards a positive future in Chinese philanthropy."

    For additional resources helpful for anyone interested in philanthropy trends in China, keep an eye on the China Philanthropy blog and the Hurun Report Charity List. (Its 2010 list was released in April.)

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