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Beijing (Failed) Protests Over Collapse of China’s Peer-to-Peer (P2P) Industry

A P2P Crisis: investors who have lost their savings tried to take their grievances to the street.

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Image via Tech Sina (http://tech.sina.com.cn/i/special/forefront/p2ppl/).

The regulatory crackdown on Chinese online lenders caused a climate of heightened tension in Beijing today, where investors who have lost their savings were trying to take their grievances to the street.

Recent crackdowns on China’s online lending industry have caused some unrest in Beijing today, where planned gatherings by victims who were trying to draw attention to their misfortune were immediately shut down by authorities.

Companies they’ve invested in were either closed down, or the directory boards have simply abandoned their business and have taken off (跑路).

Today, WeChat and Weibo have been buzzing with rumors of people being victimized by the P2P crackdown attempting to gather and protest in various places – one of them being in Beijing.

But local authorities and security guards have been quick to shut down protests, allegedly even barring some travelers from entering the city.

P2P Chaos

China’s P2P industry has seen a quick rise and fall over the past year, causing some panic and chaos.

Earlier this week, China’s New Fortune magazine reported of one case where an investor had just invested 360,000 RMB (±US$52,700) into P2P platform Guojinbao (国金宝), when they discovered the platform was already abandoned the day before, and there was no way to get their money back. It is just one among many recent cases.

Peer-to-peer (P2P) lending (defined asa method of debt financing that enables individuals to borrow and lend money without the use of an official financial institution as an intermediary“) has experienced unprecedented growth in China over the last 10 years; hundreds of microloan lenders have sprouted up, in place of traditional state-owned banks, to provide funding and capital to everything from companies to individuals.

For many Chinese investors, P2P lending is an apparent attractive alternative investment. Especially because, according to a 2015 case study by the Associate of Chartered Certified Accountants (ACCA), only 9.6% of Chinese people are able to get proper bank loans.

Since China’s mushrooming online lending companies were largely unregulated before, the rise of P2P in China has also given way to a great number of ‘troubled’ companies and lending scams.

(Note: to understand more about the rise and fall of China’s online P2P lending, read this insightful overview by Jiefei Liu at Technode. Also check out our background article “The “Wild West” of Banking in China: Andrew Collier on China’s Shadow Banking” here“.)

As of this year, China’s central government has enacted stricter rules to protect against these kinds of shady business dealings, which have already affected hundreds of thousands of investors.

Stricter monetary policies and renewed regulations have led to a wave of closures this year.

On August 2, TechNode already reported about responses to the crackdown, with people protesting in front of police stations, organizing online investor rights groups, and making collective efforts to pressure authorities to get their money back.

P2P Protests

These responses now seem to intensify. The overseas Chinese community website Boxun reported about a planned protest march in Beijing on August 6, among others near Ritan park, which was cracked down by local authorities.

Alleged bystander videos showed how people were forcefully taken away by police (video and video and video) or how people were questioned on the train to Beijing (video) (NB! We have not been able to verify if these videos were indeed recorded today, we just know that the people posting them on WeChat/YouTube claim they are).

There were also reports of people being taken away on public buses. “Have truly never seen anything like this in Beijing. We counted 120+ buses at site of the (failed) protest against P2P lending fraud, stretching far as the eye can see – all the way to Diaoyutai. Cops nap, wait in each. Petitioners rounded up, shipped off inside. The SCALE..!,” Becky Davis (@rebeccaludavis), China Correspondent for Agence France-Presse, tweeted on her timeline.

A Twitter account named “P2P China Right” (@P2Pweiquan) posted: “As a result of the government’s powerful police force and strict guard, hundreds of buses are waiting at the gate of the CBRC, About 10000 people were forced to take the bus. Announcing: the 8/6 event failed!”

Although today was an especially charged day, it is not the first time Chinese authorities are cracking down on P2P platforms. In October 2015, Chinese authorities already introduced new regulations to reduce lending fraud.

In 2016, more P2P lending companies closed operations as a result of these new regulations. Most notably was Ezubo, a ponzi scheme disguised as a peer-to-peer lender, which allegedly defrauded more than 900,000 people.

By Manya Koetse, Miranda Barnes, and Ryan Gandolfo.

Spotted a mistake or want to add something? Please let us know in comments below or email us.

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Stories that are authored by the What's on Weibo Team are the stories that multiple authors contributed to. Please check the names at the end of the articles to see who the authors are.

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China Insight

“Chinese Spy Balloon” Versus “Chinese Civilian Airship” – The Chinese Words That Matter in the Balloon Incident

On Chinese social media, the Chinese balloon is seen as a weather device that ended up measuring the temperature of China-US relations.

Manya Koetse

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A day after the U.S. military shot down a Chinese balloon off the Carolina coast, the ‘balloon incident’ is a hot topic on Chinese social media, as official media are publishing about the incident and social media users are discussing it.

At 8:17 in the morning on Feb. 5, the Chinese Ministry of Foreign Affairs published its response to the shooting down of the Chinese balloon on Weibo.

They expressed “strong discontent and protest” over the American use of force to attack the “civilian unmanned airship” (民用无人飞艇) after Chinese officials recurringly informed the U.S. side that the balloon – described as a weather device, – had accidentally entered the U.S. and did not pose any threat to the U.S. whatsoever (#外交部就美方宣称击落中国无人飞艇发表声明#).

On Chinese social media, as also described in our earlier article on the incident, the balloon has come to be referred to as the “Wandering Balloon” (流浪气球) in the context of the box-office hit The Wandering Earth II.

At the same time, China celebrated the Lantern Festival (元宵节) which marks the first full moon of the Chinese New Year. It is tradition to eat glutinous rice balls and enjoy lanterns floating in the sky.

The balloon incident set the Chinese social media meme machine in motion, in which the balloon, The Wandering Earth II, and the Lantern Festival all came together in various images that circulated on Weibo and beyond.

The balloon, featured in ‘The Wandering Balloon’ movie produced by ‘US Government’, wishes everyone a happy Lanern Festival.

Another meme titled “Wandering Balloon” drawing comparisons between the ballloon and rice balls traditionally eaten during Lantern Festival.

The Weibo hashtags used to discuss the incident were mainly initiated by Chinese (state) media outlets, such as “The U.S. Side Claims to Have Shot Down Chinese Unmanned Airship” (#美方宣称击落中国无人飞艇#); “America Uses Military Force to Attack Civilian Unmanned Airship” (#美方宣称击落中国无人飞艇#); “The U.S. Side’s Insistence on Using Force Is Clearly an Overreaction” (#美方执意动用武力明显反应过度#).

“Is it a balloon or an airship? The American official and media side all claim it is a spying balloon; the Chinese side claims it is an civilian unmanned airship,” one blogger wrote, showing the different media contexts in which the incident is being discussed and emphasizing the importance of the vocabulary used.

Words matter, and at a time when there is a lot of speculation about the incident, the seemingly humorous way in which Chinese netizens have responded to the international dispute also relates to the language that is being used to describe the event.

On Chinese social media, the majority of commenters see the balloon as a weather device that went wandering and, unexpectedly, ended up measuring the temperature of Sino-American relations – which turned out to be icy cold.

Some examples of the kind of phrasing that matters in the Chinese media context:

Civilian Unmanned Airship
民用无人飞艇 Mínyòng Wúrén Fēitǐng

The balloon in question is described as a “civilian unmanned airship” in Chinese official and state media texts. The word ‘civilian’ (民用) is included in the clarification about the balloon being a civilian meteorological balloon, and thus not serving any military purposes (民用 ‘civilian’ versus 军用 ‘military’).

Attack [on] Civilian Unmanned Airship
袭击民用无人飞艇 Xíjí Mínyòng Wúrén Fēitǐng

The U.S. military shooting down the Chinese balloon is also phrased as an “attack” (袭击) in many Chinese media reports as well as in the official Foreign Ministry post.

Completely by Accident
完全是意外 Wánquán Shì Yìwài

The expressions “completely by accident” (完全是意外), “unexpected circumstances” (意外情况), and “force majeure” (不可抗力) are used in official Chinese media texts describing the balloon incident to underline that the circumstances in which the device floated into American skies was not only unrelated to military / government purposes, but that it was also unintentional.

Stay tuned for more updates.

By Manya Koetse 

 

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China Insight

Hot Air: Chinese Social Media Reactions to the Chinese Balloon Incident

The Chinese balloon incident is also referred to as the “Wandering Balloon” on social media at a time when ‘Wandering Earth II’ is trending.

Manya Koetse

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The 2023 “China balloon incident” has gotten so big over the past few days that it already has its very own Wikipedia page now.

On Feb. 2, 2023, it was announced that a Chinese “surveillance balloon” was traveling over the northern United States. Later, it was reported that a second Chinese balloon floated over Latin America.

As a consequence, U.S. Secretary of State Antony Blinken called off a scheduled visit to Beijing, calling the presence of the Chinese balloon “an irresponsible act.” The balloon has also been dubbed the “Chinese spy balloon.”

On Sunday morning after 4 AM China local time, news came out that the U.S. military had shot down the Chinese balloon off the Carolina coast after the coastal area of North and South Carolina had been closed for the national security operation.

In an earlier statement on Friday, Chinese officials referred to the balloon as a civilian “airship” (“飞艇”) used for weather monitoring and meteorological research that deviated from its original route due to the wind. The incident, therefore, is also described as the “Chinese Airship Incident” (“中国飞艇事件”) by Chinese media outlets.

On Chinese social media, the issue is referred to as “the balloon incident” (“气球事件”) or the “balloon problem” (“气球问题”), and many netizens think it is all about “making a big issue over nothing” (“小题大做”).

The balloon is also nicknamed “the wandering balloon” (流浪气球) in light of the current Chinese box office hit The Wandering Earth II. One of the hashtags used to discuss the events was “The Wandering Balloon II” (#流浪气球2#).

Chinese political commentator Hu Xijin, who frequently posts on social media, suggested earlier that the U.S. side allegedly is very well aware that the Chinese balloon – which accidentally went “wandering” – actually “poses no threat” and that ongoing reports about the balloon were purposely being used to create an anti-Chinese narrative.

Hu’s reasoning is similar to that of Chinese International Relations Professor Li Haidong (李海东), who claims that the balloon story is framed as a threat in order for the U.S. to gain an advantage in bilateral negotiations (#专家称美炒作气球事件对华施压#).

Following news reports about the Chinese balloon getting shot down, some Weibo commenters jokingly lamented that the “poor baby balloon” had been ruthlessly shot down without even getting the time to float around.

“Such a pity,” some wrote, with others suggesting it’s “just a stray balloon.”

One of the hastags used for online discussions of the balloon getting shot down was “The Wandering Balloon Is Shot Down” (#流浪气球被击落#) and “The ‘Wandering Balloon’ Gets Shot Down by American Military” (#流浪气球被击落#).

There are many online jokes about the incident, such as those saying that the Chinese people thought the sci-fi blockbuster Wandering Earth II was the current film hit and that they had not expected the ‘Wandering Balloon’ to be the actual hit of the moment.

The fact that the current Chinese balloon developments trigger so many online comparisons and memes related to the sci-fi film Wandering Earth II perhaps doesn’t come as a surprise, since the movie has been among the hottest trending topics of the past week, and considering its narrative is all about catastrophic events and the future of international society.

Others comment that since this is the time of the Chinese Lantern Festival (元宵节), celebrated on the fifteenth day of the first month of the Chinese New Year, the incident is just another way of wishing everyone a happy new year.

All jokes aside, there are also bloggers who see the incident as a more serious occurrence at a time of worsening Sino-American relations, suggesting the significance of this matter “can’t be underestimated.”

For more updates on this story, see this article.

By Manya Koetse 

 

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