Chinese Economy of scales

 

Red dragon fish have become popular in China, partly because of their excellent feng shui. Courtesy of IIKP China

Forget gold bars, marquee cars and fancy houses. Red dragon fish are the ultimate status symbols for a growing number of wealthy Chinese. The endangered species is traded legally and fetches up to 800,000 yuan ($117,000) for a perfect specimen.

And to prove their worth, unlike most commodities, they have doubled in value since the global economic crisis bit in September last year.

According to their owners, red dragon fish have excellent feng shui as they emanate strong yang vibrations to balance the yin of water, which attracts qi, or energy.

Beijing architect Liu Baohe, for example, has kept fish since he was young, raising various dragon fish varieties before investing in the red.

"It benefits my job and life by making me relaxed and happy," he says. "And I believe kindness to others results in good fortune."

Celebrities and high-profile investment bankers are among the growing circle of red dragon fish owners.

They are attracted by the fish's likeness to the dragon, a traditional symbol of China, with its elongated body, large eyes and mouth, metallic scales, and barbels on the chin that look like dragon tendrils.

"Their spirit and arrogance when swimming is just like a Chinese dragon," says Beijing civil servant Zhang Zhengqiang, who keeps fish ranging in price from 10,000 ($1,460) to 30,000 yuan.

The red dragon fish is close to extinction and listed by CITES (Convention on International Trade in Endangered Species of Wild Fauna and Flora) as an Appendix 1 animal, the highest classification.

There are virtually no wild fish left and a captive stock of 8,000 "breeders" are mostly held in farms by the Kapuas River in West Kalimantan, Indonesia, the only place they are native to.

They are notoriously difficult to breed anywhere else and this adds to the species' mystique.

The sale of Appendix 1 animals is usually prohibited but this convention was lifted in the case of the red dragon fish because it is bred in captivity and can therefore be sold, subject to restrictions.First generation breeders cannot be traded, but second filial generation (F2) fish can.

Each fish has a birth certificate and microchip implanted in its side so it can be identified.
For a sale to be legal in China seven ministries must give their approval and the process takes about four months.

One of the largest red dragon fish farms in the world outside Indonesia is in the sleepy Beijing backwater of Jinzhan town, which has tanks for 2,000 specimens, though its inventory is usually about 600.

Large, solid iron gates keep out unwanted visitors, while CCTV cameras, guards and some ferocious Tibetan mastiffs provide 24-hour security for the VIP fish.

IIKP China general manager Tom Chiu is a former journalist who admits he is in the fish business for money, but is also keen to safeguard the species' survival by farming.

On a tour of his facility, part of the Indonesian group PT INTI Kapuas International, Chiu points out a tank in the VIP viewing room. There are nine fish, sold as an "emperor set" for 500,000 yuan ($73,150).

In another aquarium, beside a comfortable sofa, there is a single fish, a 50 cm, 2-year-old "Treasure red dragon" specimen that Chiu says is "perfect", the best of its breed in China and retails for a staggering 800,000 yuan.

Though IIKP China deals with mainly high-end clients, red dragons aren't cheap elsewhere. At Nuren Street market in Beijing's city center, there are a number of stores selling aquarium products and dragon fish.

While the silver variety can be bought for as little as 60 yuan, the reds are on offer for 6,500 yuan ($950) to 60,000 yuan ($8,800), depending on their age and condition.

"Three to four years ago sales in China were negligible," Chiu says. "It now comprises around 60 percent of the world's sales. It's a trend. China loves dragons."

It was not always thus. Though the red dragon fish was considered to be a gift from heaven by locals in Kalimantan, it was salted, dried and eaten.

Chiu says that although Chinese-Indonesians may have been the first group of aquarists interested in red dragon fish, it was the Japanese who introduced them to the wider world, following their occupation of Indonesia in 1942.

Over the following decades demand among collectors increased while stocks decreased, partially because of damage to the fish's habitat, and this led to its CITES listing in 1975.

Even so, smuggling was rife as locals and collectors emptied the Kapuas River of fish, finding a market in areas with large ethnic Chinese populations like Taiwan as well as Singapore and Malaysia.

Meanwhile, commercial farms increased the captive population of fish so that in 1989, CITES allowed trading.

Chiu says the fish is marketed as a status symbol but this does not fully explain its attraction to ardent fans.

(China Daily 07/07/2009)

source: http://www.chinadaily.com.cn/bizchina/2009-07/07/content_8385902.htm

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