For the 25th anniversary issue of the Forbes Billionaires List, I was fortunate to have the opportunity to interview one of the world’s greatest entrepreneurs and philanthropists of our time, Li Ka-shing. His first interview with a Western media in nearly five years took place atop his headquarters in Hong Kong. (Please click here for the full profile.) The conversation, mostly in Mandarin Chinese, covered everything from his thoughts on Europe to Hong Kong’s rising costs and advice for young entrepreneurs. Translated excerpts  follow.

Q. What’s ahead for the global economy?

A. I’m definitely concerned about the present state of the global economy. Both the U.S. and Europe are dealing with economic and political issues. Inevitably, every Western country and even some countries in the East are democracies with their leaders elected by popular vote. This is what our world values. Any political party that aspires to power as president or prime minister must take into account the will of the people, which means finding the means to provide excellent welfare benefits and shortened working hours. This results in a larger and larger deficit. This will make recovery more difficult and extend the timeframe for a full economic recovery. This will take a long time. Asia is faring better, but it will also be affected. The coming few years won’t be easy, with GDP growth slowing. Yet our group provides products and services for the masses, not luxury products.
Q. There has been a lot of controversy surrounding the euro. What’s ahead for Europe and its currency?

A. The countries that did not join the euro, such as Switzerland, Sweden, Denmark and Norway are still enjoying good economic growth. Germany is very strong, and France is doing all right. Their citizens are well off. Only the banks are in trouble. The Netherlands is also doing well. Quite a few countries are doing well, actually. But a few countries, such as Greece, Portugal, Italy, and Spain are facing many problems.

As I said before, a politician in power must first please its citizens, particularly in terms of more welfare benefits. It’s the same in the United States. I can’t say that’s wrong. Everyone likes good social benefits and shorter working hours. But now the government must implement austerity measures. Otherwise, it will go bankrupt. The people will be upset. There are many unforeseeable challenges.   As businessmen, we need a 360 degree perspective, and look at everything from all possible angles, such as economics and politics. Our Group has businesses in 53 countries. We have a good management. I would not be worried (about us).
Q. In the midst of tough times for Europe, you have made some big investments in the UK last year. Why are you optimistic about its economy?

A. Although the UK is part of Europe, the British pound remains separate from the Euro currency. The British currency is relatively stable. The UK has good law and order. I trust that this country has accountability, and we have confidence in our UK investments. The UK has greater flexibility, which is why I am not as concerned about the UK as I am about other European countries.
Q. There are a lot of worries about China’s economy. What’s your take?

A. I believe China can maintain GDP growth of at least 6% to 8%. The increase in wages for laborers outpaced inflation, which contributes to the stability of society. I believe Chinese leaders are pleased with the state of the economy. Purchasing power is also strengthening. Every year, about 10 million people are moving from rural areas to urban areas for employment. In ten years, it will be 100 million. Average wages in urban areas are higher than those in rural areas. I expect wages will continue to rise in double digits in the coming ten years. As for housing, the demand will still be there. Profit from property projects is not astronomical, but we can make a reasonable profit.
Q. So those talking about a hard landing are wrong?

A. It will be a soft landing. We will slow our pace of land acquisition in China, but we will continue to buy.
Q. What’s ahead for Hong Kong’s property market? A. Hong Kong’s property market is not doing badly, but no one seems to have noticed that in the past two to three years, construction costs have risen 30%. Besides rising costs of building materials, there is a shortage of construction workers. Many government projects will get underway, and Macau’s casinos have also attracted many workers. (So) Hong Kong is facing rising constructions costs of 20% per annum. This is a conservative estimate. It may be even up to 30%. Thirty years ago the sale price for one square foot in a commercial or residential property was only HK$500. Today, construction cost alone is already HK$2500 per square foot, which is five times the completed cost at the time. Construction costs are rising not just for luxury properties, but also for mass market properties. The good thing is even if the economy is not doing well, property prices will not fall quickly.
Q. Your investment in Facebook is paying off very well. Can you tell us how it about came about?

A. When we invested in Facebook, they hardly had any revenue. Initially it was a small investment of US$120 million, but I continued to acquire more shares. Everyone loves their Facebook as a new way to keep in touch and communicate with others. With their revenue set to rise further and further, I knew that it had good prospects. This was initially my personal investment. I injected the investment into the Foundation later on. I have never disclosed how many shares we own.
Q. Many of your technology investments mostly involve mobile technology. Is it because you are interested in how people live?

A. Yes. Artificial intelligence has a great future. AI has reached an inflection point. Combined with the high speed mobile network, disruption in several industries will be unavoidable. AI will lead a change. For example, like the finance industry. Now it is always speed trading. Will it, with the help of AI, morph into smart trading? This is one area. Will AI be important to education? Now the iPad is targeting the education market. That means that the method of learning will be closely knitted with your device. What will it mean to have so many people learning through a new methodology? What will the massive data tell us?

Q. Do you use an iPhone?
A. Yes, I send my own emails and SMS. When I was young I liked taking photographs. I have many interests.
Q. Your group is very diversified at a time when many investors favor specialization. Why do you believe that diversification is a good approach to business?

A. I have always been interested in learning what I can do the next day. I spend more time planning for tomorrow than I do on getting things done today. I started working in 1940 to 1949, and then I established my own company Cheung Kong Industries in 1950. For over 60 years our company has been expanding. Our diversified businesses in 53 countries and their synergies give me and my colleagues a great deal of confidence.
Q. What advice would you give a young entrepreneur about how to find success in life?

A. There are plenty of opportunities in mainland China. Starting a business is not easy. I started my business in 1950 with only HK$50,000 . It wasn’t a lot. You could buy a Cadillac or a Lincoln with it. For a young entrepreneur today, hard work is more important than opportunities. If you don’t work hard, opportunities will slip away.