Photographer: Imaginechina

How Chili Sauce Spices Up One of China’s Best Economies

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China's best-selling chili sauce is “Lao Gan Ma,” which translates to old godmother. It's also helping one of the poorest provinces support some of the country's fastest economic growth.

The spicy sauce found in millions of kitchens is stocked in every store for about 10 yuan ($1.45). It's also carried abroad by Chinese, though it's increasingly available internationally, and on Amazon.com (for $9).

The chili magnate who has earned herself a loyal following is Tao Huabi, 69, from Guizhou Province, a poor, mountainous region in the southwest that's now one of the brightest spots in the nation’s economic slowdown.

Guizhou's 10.5 percent growth in the first three quarters this year is the second fastest of all provinces and far ahead of the 6.7 percent national rate. It's kept that lead since 2010.

 

 

Tao's company, Guiyang Nanming Laoganma Food Co. in the provincial capital of Guiyang, helps give the city a prop. It had sales of 3.72 billion yuan in 2013, according to a local paper, Guiyang Evening News. A spokesperson wouldn't confirm that or provide new numbers.

Another consumer-focused source of strength for Guizhou growth, and also is dominant in terms of domestic market share: Kweichow Moutai Co.

The producer of top-shelf 100-proof baijiu, China's signature grain liquor distilled from sorghum and wheat, has weathered an economic slowdown with strong sales. Shares of Renhuai-based Kweichow have soared 42 percent this year for the fourth best gain in the Shanghai Shenzhen CSI 300 Index.

Guizhou’s liquor exports surged 44 percent year-on-year to $2.18 billion in the first ten months this year, while shipments of chili sauce and other condiments jumped 16.5 percent to $7.43 million, according to a Guiyang Daily report.

That's welcome news when national exports have slumped for almost two straight years.

Guizhou, with a population of 35 million, is still relatively poor with per capita income about half the national average. 

 To be sure, chili isn't the only thing driving Guizhou's economy.  The province, aiming for high tech and big data, has pulled in investment from firms including chipmaker Qualcomm Inc., iPhone maker Foxconn Technology Group and local telecommunications giants China Mobile and China Unicom.

There's an old saying about subtropical Guizhou: Not three feet of flat land, not three days without rain, not a family with three silver coins. Now that's becoming outdated.

— With assistance by Miao Han

(Corrects value of liquor exports in eight paragraph)
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