"Our Family Should Have Made It": One Family's Wealth and Opportunities Over 30 Years | Shenzhen at 40, Part 2

It has to do with all of Shenzhen and with reform and opening-up — or more precisely, it is a parallel world running alongside Shenzhen's development.

Huang Honghong has lived in Shenzhen for 31 years. She arrived in 1987, the eighth year since the Shenzhen Special Economic Zone was established and the ninth since the Shekou Industrial Zone appeared. Huawei was founded that same year. Three years later, the Shenzhen Stock Exchange opened. She has played the stock market — in 1991 — and the property market — in 1991, 1994 and 2003. Her husband was Huawei's 54th employee.

As her son, Pan Zexing, puts it: "Our family should have made it."

Historical narratives are usually grand. They like to sum up one generation as the beneficiaries of a demographic dividend, another as blessed with rare opportunity. But come down to a specific person, and at every turning point there seems to be a parallel world waiting for him.

This is most people's life.

Pan Zexing thinks it's a bit of a shame.

1

Huang Honghong was standing in line at Jinzhuyuan, No. 20 Sihai Road. The line wasn't long, but she suddenly felt embarrassed. The spot was close to the factory, and she worried a coworker might walk past, recognize her at a glance, and decide she'd gone mad with the urge to get rich. This woman, not yet twenty, worked the assembly line at an electronics factory in Shenzhen's Shekou Industrial Zone. She liked money, but some things mattered more to her than money — what other people thought of her, for instance. Two years earlier, that same instinct had cost her a chance outside Shenzhen Development Bank. She spent the 200-odd yuan she had — more than half a month's wages — and, given the choice between a share of stock and a skirt, took the skirt.

Back then hardly anyone actually knew what a stock was. Even in the special economic zone of Shenzhen, that was true. A handful of old shares — Shenzhen Development Bank, Shenzhen Vanke — had only just gone on sale, and the Shenzhen Stock Exchange had begun trial operations in December 1990. In a financial management class at the Shekou training center, the visiting instructor mentioned "stocks." The workers remembered it afterward, but none of them found it exciting at the time.

At this stock subscription in the Shekou Industrial Zone in November 1991, stocks were still a novelty. Almost no one in the factory planned to subscribe. Huang Honghong was eager enough to stand in line, but she knew very little about stocks, and she even suspected, as some people said, that this might be ill-gotten money. It left her feeling conflicted.

Huang Honghong decided to leave Jinzhuyuan as fast as she could. There was another line near the China Merchants Building. She hadn't been standing there long before she used five ID cards to collect five forms, and two of them ended up winning the lottery for "Shenzhen Zhonghua," ticker code 000017. Each winning form meant a subscription of 2,000 shares, priced at 3.75 yuan a share at the IPO. She asked her family for a sizable sum of money.

Not long after this fashionable investment, Shenzhen's stock market was overwhelmed in 1992 by a sudden flood of buyers, in what people called a "stock market crash." On August 7, the Shenzhen branches of the People's Bank of China, the Administration for Industry and Commerce, the Public Security Bureau and the Supervision Bureau announced the sale of 5 million new-share subscription lottery forms, purchasable with an ID card, with a 10 percent winning rate. Before the sale on August 10, the city's 300 sales points were packed. At some of them, the forms sold out in under half an hour, and angry buyers smashed and burned police cars.

Huang Honghong didn't join this belated buying frenzy. The Shenzhen Zhonghua shares she'd won went public on March 31, 1992, opening at 11 yuan a share that day and rising steadily afterward, breaking 21 yuan by May 6. An easy, handsome win for an early bird.

2

Huang Honghong came to Shekou in 1987. Like most assembly-line workers who traveled a long way to get there, she had confused Shekou with the Shenzhen Special Economic Zone before she set out. The Shenzhen Special Economic Zone was established in 1980, and its area was small, covering only what are now Futian, Luohu, Nanshan and Yantian districts. Around it, areas that had once belonged to the same Bao'an County were not part of the zone; most of the time, people called them Shenzhen's "outside the checkpoints." And in the lower-left corner, the Shekou Industrial Zone had been established even earlier — it was the first to bring in foreign-funded and joint-venture factories, and the first to recruit assembly-line workers at scale, from Guangdong province and from across the country. But by around 1987 the confusion no longer mattered. As factories moved in and multiplied, all of Shenzhen had more or less become a city with a heavy industrial character — though some of these "factories" might be just a few floors rented inside a residential building.

In Shekou, recruitment was often tightly planned: one township would supply workers to one factory over the long term, until the labor left in that township could no longer keep up with the factory's expansion. That was the case with Pingyuan County, Guangdong, in 1997, when the county could no longer meet the hiring quota of Japan's Sanyo factory in Shekou.

Until she was 16, Huang Honghong lived in Shuikou, a small town in the northeastern corner of Guangdong province, less than 400 kilometers from Shenzhen. A vocational high school had opened there a few years earlier, and Huang Honghong was in its first graduating class. Her father had originally arranged an assembly-line job for her at a large cotton mill. The mill was in the county seat of Xingning, 29 kilometers from Shuikou.

The factory that came recruiting in Shuikou on the ninth day of the first lunar month in 1987 was called Xinan Electronics — "xinan" means southwest, and as the name suggested, its owner was from Sichuan. It later renamed itself Shenwei Electronics and became a China-U.S.-Japan joint venture. The factory sat in the Shekou Industrial Zone and mainly made circuit boards. IBM was one of its major clients — in the 1980s, this American company's contract manufacturers were everywhere. Its other clients included two of Japan's big camera makers, Canon and Ricoh.

The factory gave Huang Honghong a temporary residence permit and a border defense pass, which let her move freely throughout Shenzhen. This was a privilege. In 1990, Shenzhen's permanent population was 690,000 and its temporary population 1.33 million, but only just over 40,000 people lived inside the Special Zone itself. Starting in 1982, the inside and the outside of the Special Zone were separated by barbed wire and checkpoints, known as the "second line" (to distinguish it from the "first line," the checkpoint between Hong Kong and Shenzhen); entering the zone required a border defense pass. Later, after Huang Honghong left the factory and moved outside the checkpoints, this freedom of movement became extremely hard to come by — so much so that her only memories of Hong Kong's 1997 handover come from photos taken by her husband and son. "They (inside the checkpoint) took a lot of photos. I (outside the checkpoint) didn't have a border defense pass."

In Shekou, the roads were clean and free of dust, the factory was clean, and the assembly line for electronic components was tidier than the one at the cotton mill. The factory's automatic glass doors were clean too — when her father came to visit her, he walked straight into one. But the mood on the assembly line could turn tense; in 1986, women workers had a dispute with the factory over not having time to use the bathroom.

The workers lived eight to a dormitory room, and several rows of dormitory buildings made up the "Sihai" (Four Seas) compound — the name taken from the phrase "the five lakes and the four seas," meaning all corners of the world. In the evenings it absorbed a stream of cyclists arriving from one direction. Shekou's nightlife did include a cluster of bars reminiscent of Hong Kong's Lan Kwai Fong, but those belonged mostly to the "foreign devils" sent over by the foreign-invested firms. Most people passed the time in boredom, in the dorms or on the street; they had no appetite for town-hall-style salons and weren't excited by any fresh air of freedom. The open-air theater in the Sihai compound was where they went most often.

Huang Honghong's aspirations ran a little higher than theirs. Rather than the open-air theater, she preferred the cinema, where you had to buy a ticket. Sometimes she'd go to Huaguoshan to buy vegetables — Huaguoshan was Shekou's villa district, where the produce was more varied. She enrolled in six courses at the Shekou Industrial Zone training center, all of them on finance, meeting Tuesday, Thursday and Saturday evenings, and earned a diploma after two years. It was in that class that Huang Honghong first heard the word "stock." Accounting was a decent job back then, but in the end she never used that financial knowledge again.

In Sihai, Huang Honghong changed dorm rooms several times. The factory was always hiring, and people were always leaving too — quitting to run a small business elsewhere in Shenzhen, or simply going back to their hometowns. But Shekou always left Huang Honghong with a good impression. "Shekou is the most beautiful." Developers there later coined the slogan "the most livable place for humankind," and everyone knew it referred to the villa district where only a few people lived — a place where the sky really was blue, the clouds white, the coconut trees and their shadows lovely.

Shekou had already tried monetizing housing reform in the 1980s: besides renting welfare housing cheaply, people could also buy on credit. In 1987, a 66-square-meter apartment at Shekou's Rose Garden cost 13,000 yuan in total, under 200 yuan per square meter (Shekou housing today runs around 100,000 yuan per square meter) — though at the wage levels of the time, it still took several years to pay off the loan.

This reform was hailed as a landmark at the time and for years afterward, but no one Huang Honghong knew became a property owner in Shekou in the 1980s. The people who did become property owners were someone else entirely.

None of that changed her verdict on Shekou. About a decade later, Huang Honghong spent two years in Guangzhou. She disliked it completely, calling it an old city "full of people, nothing but people." Every time she traveled from Shenzhen and arrived at Guangzhou Railway Station, she felt annoyed. Back in Shenzhen, she'd buy clothes at the busiest mall in the old Dongmen district — "that's a mess too," she said.

"Shekou is the most beautiful. Even the city center of Shenzhen doesn't strike me as beautiful, let alone outside the checkpoints."

3

In 2018, Huang Honghong is 47 and lives "outside the checkpoints."

Earlier this year the State Council agreed to abolish the "second line," hoping all of Shenzhen could be "planned and built as one"; the second-line checkpoints had already begun coming down in 2015, and border defense passes stopped being issued in 2008. But everyone knows this is just a quick change of wording. Shenzhen people understand the difference between "inside the checkpoints" and "outside the checkpoints."

Of course, of all the areas "outside the checkpoints," Longhua is the best.

Huang Honghong lives in Longhua, in a self-built, three-and-a-half-story building. The gap between buildings is so narrow that neighbors can shake hands across it, so people often call them "handshake buildings." In the early years, when villagers were racing to put up buildings, these newly sprouted housing clusters were called "new villages"; now they're called "urban villages." After radical urbanization, Shenzhen is a city with no rural administrative units left. These "villages," though they sit inside the city, clearly stick out. The government is welcoming developers to renovate and redevelop them, which every so often sets off disputes like the one between Vanke and Foxconn workers.

Huang Honghong, her husband and their son, then not yet two years old, moved into Longhua for the first time on April 1, 1995. "Sometimes you just remember the date you moved, very clearly."

Her son Pan Zexing is now a filmmaker in his early twenties who shoots commercials and documentaries. He has plenty of opinions about Shenzhen, most of them not flattering. He thinks people in this city tend to be snobbish, recognizing only efficiency and money, moving fast but lacking any larger goal. These criticisms aren't new — they were already common when his mother first arrived in Shenzhen. He stood at the intersection of Meilin Road and Zhongkang Road; the old Meilin checkpoint used to be not far from there. From Longhua, that checkpoint was the main route into the city center of Shenzhen. "Back then I'd hear people say 'going to Shenzhen,' and I found it strange — wasn't I already living in Shenzhen?"

The good side is that you can survive in this city on very little money. Urban villages make it possible for newcomers to Shenzhen to rent a single room for less than 1,000 yuan a month. True, they rarely feel the sense of privilege Huang Honghong and her peers felt when they first arrived in Shekou, but considering that back then six or eight people were crammed into a dorm of just over 40 square meters, urban villages aren't bad either. Huang Honghong rents out the ground-floor shopfront and the second-floor rooms; a room goes for 750 yuan a month.

These tenants probably start their day the same way Pan Zexing does — taking the subway to work. But because so few subway lines run out to the areas outside the checkpoints, sometimes you have to let three packed trains go by before you can squeeze into a carriage. And the subway relieves only part of the morning rush out there. A taxi driver said he would absolutely never drive toward Longhua in the morning; that would be foolish, and there's only one possible outcome, a traffic jam from 7 to 10.

Pan Zexing also has opinions about his parents' history of striving. "Our family shouldn't be this ordinary." "We should have made it." This young man, born in Shenzhen, pulled out his ID card at a pizza place in a shopping mall — it listed his registered address as Building 16, Zone A, Nanyou Building. That was Huawei's office address before the company grew to any real scale.

When he was born, this family had before it a road that only a lucky few would ever encounter.

Huang Honghong moved out of Shekou in 1991 along with her second employer, a factory in Nanshan District. Nearby she met a man who was good at repairing telephone switches — he was Huawei's 54th employee. Later they married and had a child. Huang Honghong quit her job in 1993 after getting pregnant; before she left, she was a mid-level manager at the factory. Given that working at Huawei was "like having two civil servants in the family," plus the dividends and stock options, she chose to set aside her resentment at seeing her own career cut short.

Every time Huawei grew a bit bigger, the company would relocate. Huang Honghong began moving her whole family along with Huawei. When Huawei was in Nanyou, Huang Honghong lived in a rental in Xiangnan Village. That area belongs to what is now the fastest-developing Nanshan District; over the past few years, the developers Evergrande, Excellence and Vanke have all signed old-city redevelopment projects in Xiangnan Village.

In 1994, Huawei moved to Xixiang. As in Shekou, Shenzhen was by then rolling out commercial housing. In Xixiang, apartments were going for 70,000 or 80,000 yuan a unit, but Huang Honghong had no plans to buy — she thought the apartments were too small. As in her Shekou days, she didn't seem to be part of the target population for these housing policies; she didn't have enough savings. Huang Honghong rented a 60-square-meter house in the Chentian Industrial Zone for 550 yuan. The house had been built by local farmers themselves, and it was reasonably big. There was nothing much around it. Huang Honghong had to carry her newborn on her back and walk a stretch of desolate dirt road just to buy vegetables, or to reach the door of a small securities exchange.

By 1995, Huang Honghong heard Huawei was going to move to Bantian. Not wanting to move house again, she bought her first home nearby, in a reasonably lively part of Longhua called Niudipu. Bantian is in the north-central part of Shenzhen, a subdistrict under Longgang District — though some people who study Shenzhen's regional economy consider Bantian more a part of Longhua.

This house cost 100,000 yuan, and it too had been built by farmers themselves. Around the time of the official large-scale rural urbanization campaign in 1992, people took advantage of the government returning land to them and began racing to build houses, a boom that lasted more than a decade. Huang Honghong had a similar idea: buy a plot, build a house, collect rent. "That was just how I felt inside — I was afraid my job wasn't stable enough, afraid of losing it, so I wanted some kind of security." But even these houses, which didn't look especially well planned, usually cost 800,000 to 900,000 yuan to build.

Huang Honghong had pinned her hopes on her husband's job at Huawei — buying property near Huawei made that clear. The hope was dashed soon enough. Unable to bear Huawei's high-intensity work pace and strict performance reviews, her husband quit at the end of 1997. Huang Honghong pretty much gave up on the idea of saving to build a house. For more than a month, she believed her life in Shenzhen would never improve again, and she had no appetite for food.

Before he left, her husband's monthly salary was 5,000 or 6,000 yuan, plus a quarterly bonus. He'd been posted to Shanghai in 1993, and based on his tenure and posting record, he also held varying amounts of dividends and shares. But he left Huawei.

After he finished the resignation paperwork, more than 100,000 yuan appeared in his payroll account — his shares had been cashed out in one lump sum. That meant Huang Honghong's family no longer had any stake in a company that would go on to grow beyond imagination. In 2017, Huawei's revenue was $78.51 billion, ranking 83rd on the Fortune Global 500 list.

In 1998, they went to Guangzhou for a while, repairing a Huawei switch model that was about to be phased out. Business went quiet in 2000, and they returned to Shenzhen.

Huawei didn't actually move to the long-rumored Bantian until 2000. Bantian got a 241,000-square-meter Huawei campus. Huang Honghong passed by it in 2002 — "of course it was beautiful." She knew Huawei had even built its own road, leading straight to the Bantian campus.

"Huawei was our biggest loss," Huang Honghong summed up this past June. "We got out exactly when Huawei was about to take off. If we hadn't left, who knows how many hundred million we'd have now — our dividend in a single year would have bought I don't know how many BMWs. It's maddening just to think about it."

Two of Huang Honghong's friends from the Shekou factory joined Huawei in 1991 and never left. Both died of cancer last year. Huang Honghong spoke of this hesitantly — she wasn't sure how directly the two things were connected. But the pressure was real: before the cluster of Foxconn worker suicides in 2010, it was the unnatural deaths of Huawei employees that were better known.

4

Outside the checkpoints, Huang Honghong had some very bad experiences. Once she came home to find the door wide open and a dagger sitting on the coffee table. Another time she was knocked unconscious on the street and needed a few stitches in her head. For a long stretch, the area outside Shenzhen's checkpoints wasn't safe. A Taiwanese businessman living in Overseas Chinese Town said that after they came to Shenzhen, they didn't dare venture into the surrounding areas and just stayed put in Overseas Chinese Town. China's earliest private security companies appeared in Shenzhen.

So in 2003, Huang Honghong lost several nights' sleep over whether to move inside the checkpoints.

Since moving out of Shekou, every move had taken her farther from Shenzhen's city center. She'd also made a few unwise deals, including disposing of the 2,000 shares that had risen sixfold in 1992 — she sold them to a relative at a discount in exchange for a shopfront near Shawan in Longgang, which she could then rent back to the same relative for 800 yuan a month. That was twice her salary. "I made a lot of money."

The shopfront was in a farmers' market, with clothes sold on the second floor and pork on the first. That kind of market was common at the time, but before long there were signs it was on its way out. The Shenzhen Commercial Network Plan (2006–2010) listed farmers' markets as a retail format barred from further development in municipal- and sub-municipal-level commercial districts. "Existing farmers' markets (meat and vegetable markets) are to be upgraded and renovated; in principle, no new farmers' markets are to be built within the Special Zone."

In 2000, Huang Honghong started running a postal agency. She spent 90,000 yuan pulling strings to get a storefront in an industrial park. Inside the park stood a 23-story apartment building housing nearly 10,000 workers. Before cell phones became common, Huang Honghong installed eight telephones in her shop, and the workers still lined up to use them. She'd stock 1,000 phone cards at a time. On payday, more than 200 people would come in a single day to wire money home. At her busiest, Huang Honghong employed four staff.

After saving up some money, Huang Honghong got another chance in 2003 to move inside the checkpoints.

"Should I choose Longhua, or go into the city? Buying in Longhua, it was around 3,100 yuan a square meter; in the city, the layouts weren't even as good, and it was still under 5,000 yuan a square meter. Buy bigger here, or smaller there. Four bedrooms in Longhua, three bedrooms in the city."

She rode on the back of her agent's motorbike to view the property. This residential complex in Longhua had just been completed; it was called "365 Garden." There was a fountain at the entrance, but the surroundings were still desolate. Still, there was a bus stop right at the gate — as long as you got off the bus and walked straight into the garden, you didn't have to worry about safety.

"Garden" carries a special meaning in Shenzhen. In 1987, Overseas Chinese Town Real Estate launched its first commercial housing project, Oriental Garden, with great fanfare; it was hailed at the time as "Shenzhen's best villa district." After that, all kinds of "gardens" gushed out everywhere. There was no one who didn't want to live in a garden — it was practically a prerequisite for settling down and living well in Shenzhen.

Huang Honghong worked this out. She put down a 300-yuan deposit, confirmed that the home would solve the problem of Pan Zexing going to a nearby school, and on the third night she finally slept. In the years that followed, because the postal agency was doing well, she often came home late at night, and Pan Zexing would wait for her by the fountain at the garden's entrance. But Huang Honghong still wanted to build a house — "somewhere a little out of the way, in Longhua; if you have the money you can put up a dozen-plus stories all at once, and you don't have to work, there's plenty of rent," "rent it out and collect the rent, and live in the garden yourself in the meantime." In 1999, she finally spent 60,000 yuan on a plot of land in Longhua and more than 200,000 yuan building a three-and-a-half-story house. She didn't have the capital to build higher.

Among the parents of Pan Zexing's friends are some who succeeded in putting up high-rises. This second-generation Shenzhener says that, more than collecting rent, they now hope for demolition and redevelopment, and to be worth tens of millions — or even more than a hundred million yuan — overnight. The mother of one of his friends, a woman who came to Shenzhen in 1992, said that after losing five or six million yuan investing in a vineyard, "right now I'm just waiting for the urban village to be demolished. The compensation could come to more than 400 square meters."

Such stories aren't rare. In 2010, when the urban villages of Gangxia and Dachong were demolished for redevelopment, dozens of landlords got rich overnight.

Like his mother, Pan Zexing believes that most successful people in Shenzhen are, to some degree, "property tycoons." He used a term that would otherwise only fit someone like Li Ka-shing.

His family miscalculated exactly here. When 365 Garden rose in value to 1.58 million yuan, Huang Honghong's husband insisted on selling it; he never understood her enthusiasm for property. Today that apartment is worth around 6 million yuan.

They moved back into that self-built handshake building in Longhua. It is a house with limited property rights — a "small property rights" house — which can't be used to apply for a loan, can't be made to breed more money. "It has no financial properties," Huang Honghong remarked, as if she were talking about someone else's life.

Relocation in this city has never stopped either. The industrial park where Huang Honghong's postal agency stood began coming down last year, which isn't anything to feel wronged about. The postal agency's business had been in decline for a long time, as infrastructure grew more and more convenient. Across all of Shenzhen, fewer than 200 postal agencies remain, most of them barely keeping a not-very-fast delivery service alive.

Once the industrial park is gone, a 60-story commercial center will be built on the site. This area belongs to Futian, Shenzhen's city center, and it is no longer responsible for adding to Shenzhen's industrial character. The factories are moving instead to Humen town in Dongguan and Huiyang in Huizhou. Over the past few years, Dongguan and Huizhou have absorbed a large number of factories relocating out of Shenzhen.

Still, huge numbers of people keep pouring into Shenzhen; its permanent population is growing faster now than in the 1980s. Official statistics put Shenzhen's population in 2017 at 12.53 million, but some researchers say the number of people actually living here has already passed 23 million. Some say Shenzhen could hold 40 million with no trouble.

High-rises under construction are everywhere you look. The busiest part of the city has shifted from Luohu to Futian, and is now shifting from Futian to Nanshan. Driving from Futian to Nanshan along the impossibly wide Binhai Boulevard feels like driving through a futuristic video-game scene.

Huang Honghong hadn't been back to Nanshan District in more than a decade. Now it is home to Tencent's headquarters. Tencent's new headquarters building sits right on Binhai Boulevard, its two towers linked by three skybridges at different heights. "The last time I came here with Pan Zexing, I thought, how did this get so amazing. I told him, back when I was a young woman I lived here for a long time too — when I was pregnant with you, I was right here."

She seemed to share in the glory of it, and at the same time seemed like a visitor arriving from a parallel world.

Cover image from Visual China Group (cropped), Nikita Andreev on Unsplash, Sarah White on Unsplash