The Nongfu [Farmer’s Mountain] Spring Water incident, apart from illustrating that the Chinese Communist Party does not trust private enterprises, also reflects that the authorities are still accustomed to inciting populism to achieve their own objectives.
On 25 February 2024, Zong Qinghou, founder of Wahaha Group and a well-known Chinese entrepreneur, died at the age of 79. Unexpectedly, the tribute to Zong Qinghou gradually turned into a public opinion dispute between the two beverage giants, Wahaha and Nongfu [Farmer’s Mountain] Spring Water. Nongfu [Farmer’s Mountain] Spring Water’s founder, Zhong Shanshan, became the target of many netizens’ criticisms. At first, some netizens wrote that Zhong Shanshan had failed in starting his own business, and Zong Qinghou had taken him under his wing. Zhong used Wahaha’s corporate resources to make his first bucket of gold, and then founded Nongfu [Farmer’s Mountain] Spring Water to compete with Wahaha, which is simply ungrateful. Nongfu [Farmer’s Mountain] Spring Water later issued a clarification, but it was unable to quell the public opinion, which led to a short-term plunge in its sales volume and share price. Afterwards, the public opinion storm intensified, rising to nationalistic criticism, accusing Nongfu [Farmer’s Mountain] Spring Water products of pandering to the Japanese, that Zhong Shanshan’s son is an American national, etc., and calls for boycotts were heard in waves. How did all this public opinion surrounding Nongfu [Farmer’s Mountain] Spring Water come about? What is reflected behind the incident? I think there are three main points.
First, as we all know, in China, all public opinion is controlled by the Communist Party of China. Any large-scale public opinion incident does not arise for no reason, and behind it, there is guidance and manipulation by the propaganda department. Therefore, it is absolutely impossible that this public opinion storm involving Nongfu [Farmer’s Mountain] Spring Water is a spontaneous act of netizens. Since China is not a lawless society, conflicts and struggles always take the form of public criticisms and political movements. As to why the authorities targeted Nongfu [Farmer’s Mountain] Spring Water this time, we do not know the exact reason due to the black-box system of the Communist Party. However, based on our understanding of the Chinese Communist Party’s ruling style, it is reasonable to guess that this public opinion attack on Nongfu [Farmer’s Mountain] Spring Water may have something to do with the fact that Zhong Shanshan has been ranked as the richest man in China for several years in a row.
In China, being the richest man in the country is not a good thing. The Communist Party of China has always been suspicious of private forces it cannot fully control, and has always feared that private entrepreneurs, after accumulating a large amount of wealth, would turn their money into power and threaten its rule, so it could not help but suppress those who love to seek the limelight. In the distant past, Huang Guangyu, the former Chairman of GOME Group, which was the largest consumer electronics retailer in China, was sentenced to 14 years in prison for stock manipulation. And in the recent past, Alibaba founder Jack Ma was forced to leave China for Japan. The suppression of Nongfu [Farmer’s Mountain] Spring Water may be a signal from the authorities to Zhong Shanshan, who was ranked as China’s richest man for the third consecutive year. But once the Xi Jinping regime starts cracking down on private enterprises, things will get out of hand, and the already weak Chinese economy will get even worse. Even if he wants to change course and favour the private sector in the future, I am afraid it will be too late for him to fully control the development of the situation. This is how dictatorships are often killed by their own reactionary decisions.
Second, apart from illustrating that the Chinese Communist Party does not trust private enterprises, the Nongfu [Farmer’s Mountain] Spring Water incident also reflects that the authorities are still accustomed to inciting populism to achieve their own objectives. However, water can float a boat and it can also sink it. Inciting public opinion has always been a double-edged sword, and if one is not careful, one may lift a stone and smash it on one’s own feet. For the time being, the Chinese Communist Party is not ready to break with the West as Russia and Iran have done, and it still needs to maintain a certain degree of friendly relationship with the international community in the near future. Xi Jinping’s visit to the United States and his meeting with Joe Biden in November last year is a good example of this, and during the visit the volume of anti-American propaganda in the country was lowered, so the authorities seem to be confident that they can completely manipulate the public’s sentiment. But it is not well known that there is a certain degree of inertia in human cognition. Negative publicity has reached a certain level that crosses the tipping point, and once a stereotype is formed, it can never be reversed. When China needs to be flexible in its diplomacy, this kind of Boxer Uprising*-like public opinion toward the United States, Japan, and the Western societies will become a great obstacle, and will probably eventually tie the authorities down to the dangerous path of confrontation with the international community. Therefore, the Chinese Communist Party will sooner or later cut itself by wielding the double-edged sword of populism.
Finally, in 2023, foreign direct investment in China dropped to a 30-year low. China’s economy is in urgent need of foreign capital inflows, but if things like the Nongfu [Farmer’s Mountain] Spring Water incident keep happening, it will only scare away foreign capital. This proves once again that outsiders cannot just look at China’s economic problems from an economic perspective. There are no purely economic problems in China. All economic problems are fundamentally political governance problems.
* The Boxer Rebellion, also known as the Boxer Uprising, the Boxer Insurrection, or the Yihetuan Movement, was an anti-foreign, anti-imperialist, and anti-Christian uprising in North China between 1899 and 1901, toward the end of the Qing dynasty, by the Society of Righteous and Harmonious Fists, a group known as the “Boxers” in English due to many of its members having practised Chinese martial arts, which at the time were referred to as “Chinese boxing.” It was defeated by the Eight-Nation Alliance of foreign powers.
Wang Dan is a well-known Chinese dissident and leader of the Chinese democracy movement. He is director of the Dialogue China think tank.
Translated from Chinese by Scott Savitt.