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Stay In Spain

Despite Eurozone worries, Chinese immigrants thrive


The 2008 financial crisis hit Europe hard—with Spain bearing the brunt more than many Western European countries. A grossly inflated housing bubble, creative accounting by Spanish banks, and a decline in the tourist industry were among the multitude of issues tangled around its throat.

And as the economy sank, immigration to the country—which had seen the foreign population of Spain almost double from 6.24 percent in 2003 to 11.3 percent in 2008— began to slow down. By 2012, aided by a government offer of €10,000 for immigrants willing to repatriate and not return for three years, Spain’s population had begun to fall.

One immigrant group, however, not only stayed, but flourished: the Chinese.

As of April 2016 there were 93,810 Chinese nationals registered on Spain’s social security system, of whom 48,107—51.8 percent—were self-employed. That’s more than twice as many as there were before the financial crisis, and a percentage that dramatically outstrips Spaniards (of all ethnicities) at 18.1 percent. It also comfortably beats Spain’s next-biggest self-employed groups: Danes (39.6 percent), the Dutch (37.5 percent) and Germans (36.8 percent).

And many of those self-employed people are entrepreneurs, says Joaquín Beltrán Antolín, Professor of EastAsian Studies at the Autonomous University of Barcelona. In fact, he says, “The Chinese own more businesses than any other foreign community in Spain.”

Why? For Professor Antolín, the explanation is cultural: a combination of expectations, connections, and social mores that give Chinese in Spain an advantage over the opposition. One key facet, he says, is that unlike other foreign groups, Chinese migrate to Spain expecting to own a family-run business.

“[They expect to] be the owners of the means of production so that all of their family members will profit from the business, instead of expecting them to only make money through wage labor. By contrast, the white Spanish population and most other groups of foreign immigrants in Spain do not have as great an expectation… This is the key difference.”

It’s not the only one, however: family ties bind the Chinese business community together stronger than those of other ethnic communities in Spain. “Most are small family businesses where all family members work together, which allows them to save money on wages,” says Professor Antolín. “They can also use networks of relatives, acquaintances and friends to finance their businesses if necessary—so no need to go to a bank to borrow money, since the Chinese community will lend without commission.”

For immigrants that have come to Spain with limited funds and no credit history, this element of the complex social networking system of guanxi immediately puts would-be Chinese entrepreneurs ahead of those from other countries. It also means that emerging Chinese businessmen were insulated from the fractious post-2008 financial industry in Spain that saw banks foundering and access to loans and mortgages diminished.

Having familial and friendly relationships at the core of a business plan has led to one surprising statistic: most of the Chinese people living in Spain are from the same place— namely Qingtian, a 963-square-mile county of Zhejiang Province. Hard numbers are tough to come by, but in 2012 Chinese newspaper Changjiang Daily estimated that of the 160,000 Chinese immigrants in Spain that year, 90,000 were from the mountainous, sparsely populated county. For a little perspective, that’s 25 percent of the 361,062 people who were living there in 2010.

New Chinese immigrants to Spain follow in the footsteps of their more experienced peers both literally and metaphorically; many who move there work for a while in a particular type of business run by another Chinese immigrant before borrowing the money necessary to open their own within the same industry. So restaurants beget more restaurants; stores beget more stores. But, Professor Antolín says, Chinese entrepreneurs are quick to move to other sectors when the one they are in reaches saturation. He believes this fluid and pragmatic attitude towards business helped protect them from the crisis. “Most Chinese businesses are small and the crisis has not affected them, especially because if a type of business is not successful then they will open another in a different industry. [The entrepreneurial culture] is flexible and can quickly adapt to the possibilities and opportunities.”

That’s how Chinese industry in Spain has expanded from the ubiquitous restaurants, “one dollar shops”, and convenience stores—the latter so common they’re colloquially known as chinos in some areas—to encompass media firms, fashion studios, import-export houses and other high-end businesses.

Ivana Casaburi, an Associate Professor at the Marketing Department of Barcelona’s ESADE University with a focus on SinoSpanish trade, says: “The Chinese business community is increasingly entering market sectors that combine quality and keen pricing—it is not a question of offering cheap products that consumers may see as shoddy.” She explains that small-to-medium Chinese enterprises in Spain are mostly focusing on quality retail and catering, investing in urban areas with many offices and middle-toupper-class Spaniards. “To these, one can add second-generation Chinese entrepreneurs trained at top business schools… whose business is in technology and other emerging sectors such as services and exports to China.”

Professor Antolín agrees—though he notes that the incredible influx of Chinese into Spain is diminishing. “In recent years, as quality of life has improved in China—particularly in Qingtian—the pressure to go abroad to do business has subsided, since there’s plenty of opportunities to thrive in China now,” he says. “Arrivals are slowing down.”

“However, the number of Chinese kids born in Spain keeps growing, and so does the number of members of that second generation that reach university. Their expectations after college are different from their parents, and they will open businesses with higher added value.”

“Stay In Spain” is a story from our newest issue, “Farming”. To read the whole piece, become a subscriber and receive the full magazine. Alternatively, you can purchase the digital version from the iTunes Store.

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