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May 12, 2015

How Tiens Group makes its money in Africa

Li Jinyuan, the 'generous' billionaire who just paid for 6,400 of his employees to visit Paris.

Li Jinyuan, the 'generous' billionaire who just paid for 6,400 of his employees to visit Paris.

The first result in a Google search I did for "Chinese billionaire" is a Forbes entry, "China Rich List." The rest of the results – excluding a Wikipedia entry, "List of Chinese by net worth" – both news and regular, are about the trending Chinese billionaire who paid for a France vacation for 6400 of his workers. Scanning  the entries, he is called "generous" by the UK's Independent,  while the New York Times says his company "may just have created a new kind of mass tourism-cum-business event with Chinese characteristics."

The billionaire in question is Li Jinyuan, 57, the founder of Tiens Group, a "direct sales company in China" according to the New York Times. Mr Li is said to be worth about $5.8 billion, accruing from the operations of his company which "says it reaches consumers in 190 countries and deals mostly in health food, health care appliances, skin care applications and household products."

One of those countries is Uganda. Last year we published a report from one of our grant recipients, James Wan, about Tiens Group's operations in Uganda. Tiens has stores all over the country selling products it claims are 'medicinal.' Its employees claim they can test for various illnesses with equipment such as a 'blood circulation massager,' 'face pain remover,' 'blood pressure reducer,' and a 'necklace that removes radiation.'

Its operations go beyond that, however: it also recruits people to buy and market its products to other people who then buy and market those products. Like a recruiter puts it, "TIENS only cares how many products you buy and how many people you recruit."

Tiens’ website says it has over 200,000 subscribers in Uganda. Not bad for a company whose medical schemes are doubtful. The question is, did those 200,000 Ugandans help pay for the France tour?

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