China is undergoing yet another big phenomenon, sometimes both economic and grotesque. National lotteries have not only successfully emerged, but they’ve gained great popularity as the country’s ‘game fever’ grows steadily. Sales of tickets increased 26% yoy, reaching 80 billion Rmb last month. A new record was set one year after October 27, 2009, which marked the country’s highest lotto prize worth a significant 360 million Rmb. This sum stands about equal to the salary of an average Chinese – over the course of 9,600 years.
Even more curios, was the jackpots’withdrawal process, characterized by general excitement and skepticism regarding the winner’s fortune. Unlike most other winners, however, this one collected his fortune at the cost of his identity. He arrived at the Ministry of Finance to collect his treasury, hooded and shaded with dark attire and sunglasses. After the pick-up, the mystery man donated 10 million Yuan to charity, gave-up his 20% portion to pay the prize’s personal windfall income taxes, and returned, regularly, to his home in Anyang, Henan – one of the country’s agricultural cores.
Still, the event stirred-up a feeling of curiosity among the general public, and reaffirmed the already widespread belief that the gambling mentality’ is the fastest route to prosperity. The government, too, benefits enormously from lottery innings, as they make-up a substantial part of national revenue.
Both the general increase in lotto playing throughout the country, as well as the establishment of related enterprises further prove this point. Currently, the two most renowned betting companies are the China Welfare Lottery founded in 1987, and the China Sport Lottery born in 1994. Profits made from the gambling and betting are split into three ways. Half of the revenue goes towards the prize itself, another 35% towards social welfare, and the rest is used to cover cost and expenses.
In the last decade alone, lottery-related incomes have grown –and keep growing– fast. Moreover, the growth of China’s illegal lottery business is juxtaposed to the legal one, and enjoys popularity especially in rural areas. The entirety of this shifting scenario is brought by two main economic and cultural reasons. Within the last thirty years of China’s incredible economic growth, its national and individual income have grown considerably, allowing expenditures like playing the lottery and gambling to gain greater public attention. Needs like shelter and hunger are no longer national necessities, which means society is more prone to feeding their personal interests or passions.
Gambling has traditionally been an integral part of Chinese entertainment, even — and especially — in times of crises when hopes for a quick economic fix are particularly high. This is, after all, the same mentality behind savers who choose not to spend their money, by investing it in the stock market instead. The constant shuffling between buying and selling shares is comparable to gambling, even behaviorally.
In fact, the speed with which wealth is achieved — commonly seen in China — prevails over the caution and thoroughness behind the financial decision-making process that comes along accurate analytical studies.
The government, however, is increasingly tolerant towards these economic tendencies and practices. After Mao’ rigorous era, it is now pushing towards more liberal economic policies, where seconding market investments seems more profitable than restraining them. They ensure a better economic flow enabled by citizens’ investments, thus alleviating from State’s budget the burden of pensions from a now aging population who depends heavily on its national welfare.