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China and Covid19

Resisting the Rat Race: From China’s Buddhist Youth to Lying Flat Movement

Supporters of China’s ‘lying flat’ movement says it is a form of collective emotional catharsis, but state media suggest it goes against the Chinese Dream.

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‘Lying flat’, tǎng píng , became a hot social trend in China in 2021. It received a lot of attention since, with some media calling it an “act of resistance.” Recently, especially in the light of China’s fight against Covid-19, there seems to be more resistance against this movement, with official media claiming that China’s dedicated, patriotic youth should never choose to ‘lie flat.’



This article was commissioned and produced by the Goethe-Institut for the Standstill Magazine: www.goethe.de/stillstand“. For a German-language version of this article, please see “Keine Lust auf das Hamsterrad.”

 

In March of 2022, the term tǎng píng (躺平), ‘lying flat’, was trending on Chinese social media. Since the word became popular online and was selected as a 2021 buzzword of the year, it has become part of everyday internet language in China and often pops up in online discussions.

By now, ‘lying flat’ has been adapted by Chinese state media and is painted in a different light from how it initially emerged when it was used by young people to address their views on life.

What actually is ‘lying flat’? How has its meaning shifted, and what does it have to do with Covid19, a ‘Buddhist-like mindset’, and the problem of so-called ‘involution’? Here, we will explore these terms and zoom in on discussions surrounding China’s ‘Lying Flat’ movement.

 

“Buddhist Youth” and Other Tribes

 

Every year, the Chinese language magazine Yǎo Wén Jiáo Zì (咬文嚼字) selects the most popular new words and expressions that often reveal trends among young people and also shed light on China’s rapidly changing society.

One of the Chinese top ‘buzzwords’ of 2018 was fó xì (佛系), a term from Japanese that started to be used in China to describe a “Buddha-like mindset.” In Japan, the term emerged in the media in 2014 to describe a specific type of male, “Buddhist men” (佛系男子), who are solely focused on their own hobbies and interests and self-indulgence without wasting any time on dating or love. The term also became popular among Chinese web users in late 2017 after a viral essay1 by WeChat account Xin Shixiang (新世相) used it to describe the lifestyle and mindset of many Chinese born in the 1990s (Sun 2017; Wu & Ren 2018, 15).

In the Chinese context, fó xì youth (佛系青年) mainly refers to people in their twenties or thirties who are pursuing a peaceful lifestyle in a fast-paced society. Despite being labeled as a “Buddhist mindset,” the term does not have a lot to do with Buddhist traditions. Instead, it refers to a laissez-faire attitude where one does not take on any responsibility and just goes ‘with the flow’ in order not to waste any time on trivial things.

According to an analysis by Hongjuan Wu and Ren Ying (2018), the term is not a ‘positive’ one per se, but more one of anxiety and negativity where people are merely divulging in their own interests due to a lack of motivation and loss of willingness to interact with others and function in a highly competitive environment. The authors claim that China’s “Buddhist youth” are looking for ways to escape the pressures they face in an everyday life where so much is expected of them, while they still struggle to pay for housing, medical care, and education – even if they work very hard.

Buddhist youth adheres to three principles: everything’s alright, it’s all ok, it doesn’t matter (image via QQ.com).

Instead of joining the urban struggle and striving for a better everything (better housing, better jobs, better education), they just accept their reality as it comes: it doesn’t matter if you win, if doesn’t matter if you lose, it doesn’t matter if you’re happy, it doesn’t matter if you’re sad. The 2018 popularity of the somewhat self-deprecating term ‘Buddhist youth’ reflects a collective feeling of a certain helplessness among China’s post-90 generation urban dwellers who are trying to take back control by letting go.

The internet age has made these kinds of social sentiments and movements more visible than ever before, and some buzzwords spread so rapidly that they can turn into subcultures within a matter of weeks. Some specific terms and memes resonate with millions of people who identify with them, and they are also a way for people to connect to each other and create a sense of belonging. That sense of having some shared identity is underlined by the fact that these terms are often described as modern-day ‘tribes’ or ‘clans’ (族).

When the Chinese housing market experienced surging house prices over a decade ago, the term ‘Ant tribe’ (蚁族) first saw the light – a neologism to describe a huge group of low-income, urban graduates who are hoping to find a job and settle down but end up living in poorer, crowded communities on the outskirts of the city where the rent is cheap (Michels 2014, 31).

Similarly, the same period saw the emergence of the ‘Moonlight tribe’ (月光族), those younger workers who always spend their entire monthly salary on material things and having fun, enjoying the moment and not worrying about the future. You also had the ‘Flea tribe’ (跳蚤族) (job hoppers who are always looking for the next opportunity), the ‘Latte tribe’ (urban dwellers doing things at their own pace), and many more different subcultures or social buzzwords.

“Out of money” – the ‘Moonlight clan’ referred to those young people would immediately spend all of their wages, leaving them completely broke before the end of the month (image via Doutu).

There was also a major group of Chinese internet users who started labeling themselves as diǎosī (屌丝), basically meaning “losers”, using self-mockery and satire as a form of humoristic self-medication to deal with the hardships of everyday life and growing social inequality in contemporary China. The term diaosi became one of the most popular Internet memes of 2012, signaling a growing disillusionment among (low-income) Chinese youths about being able to climb the social ladder (Szablewicz 2014, 259 -260).

 

Involution and Lying Flat

 

Over the past decade, the Chinese internet has seen more and more memes and buzzwords relating to the ‘rat race’ of modern-day China. Two of the most prominent one are ‘involution’ and ‘lying flat,’ which were also both selected for the annual buzzword lists of Yǎo Wén Jiáo Zì for 2020 and 2021 respectively.

The concept of nèijuǎn (内卷), “involution,” describes the economic situation in which as the population grows, per capita wealth decreases. The term originally comes from a 1963 work by the American anthropologist Clifford Geertz describing the dynamics of an Indonesian fast-growing population caught up in high-labor intensive wet-rice cultivation without making real progress (Koetse 2021).

The term ‘involution’ comes from this book by Geertz, published in 1963.

In the Chinese context, the term has come to be used to represent the competitive circumstances in academic and professional settings where individuals are compelled to overwork because of the standard raised by their peers who appear to be even more hardworking. In a work and education environment where people continuously work harder and longer, increased work efforts become the new normal without becoming more rewarding.

One scene from the popular Chinese television drama A Love for Dilemma went trending on social media in 2021 because many netizens thought it perfectly captured the essence of ‘involution.’ In the scene, two fathers discuss the Chinese education system, comparing it to a crowded movie theater where everyone is trying to watch the show together, until one person stands up to see more, forcing others behind them to also stand up to be able to see the screen. Then people stand on their seats, or even bring in ladders, so that they can rise above the rest. Consequently, the others are also scrambling to get higher up, but in the end, nobody is comfortable. The entire audience is stressed out and they all experience difficulties in watching the movie, while they could have just comfortably watched together if they would have remained in their seats (Koetse 2021).

One photo that has come to represent the concept of involution shows the ‘Tsinghua Volution King’ (清华卷王), which is the nickname of a student who is cycling at the campus of Tsinghua, one of China’s top universities, while simultaneously working on his laptop – not wasting a single moment to stay ahead of his peers.

The Tsinghua Volution King (image via QQ.com)

The generation that is most affected by a sense of being stuck in a ‘rat race’ of socioeconomic stagnation is the post-90 generation. In 2020, a record-high of 8.74 million university graduates entered the Chinese job market while many industries recruited fewer people than before in an employment market that was already competitive before the pandemic. These young adults end up in a pressure cooker where they are stressed when they do not have that top job, afraid of missing the train, and where they are also stressed when they do have that top job, afraid of falling off the train (Koetse 2021).

Closely related to the concept of involution, offering an alternative to the rat race, is the social trend of ‘Lying Flat’ (躺平), also known as ‘Lying Flatism’ (躺平主义, 躺平学) or ‘the Lying Flat Clan’ (躺平族). Young people who believe in ‘lying flat’ are fed up with ‘involution,’ do not buy into social expectations about marriage and children and refuse to participate in the competitive struggle that starts at early as kindergarten and is all about the upcoming exam, the best result, the top school, the promising job, the longest hours, the next promotion. By ‘lying flat,’ Chinese young adults from middle and lower classes basically refuse to sweat over climbing higher up the social and economic ladder. They will only do the bare minimum and believe that upward social mobility has become an unattainable goal (Gong & Liu 2021, 2).

Although lying flat became a popular buzzword in China in 2021 after an online article titled “Lying Flat is Justice”2 went viral, it was already used by netizens long before that time.

“I was chatting with my colleague after work,” one Weibo user wrote in November of 2018: “We were talking about how unfortunate it is that if you don’t work, you don’t have money, and that if you work, you still don’t have money. You might as well stop working and lie flat. No pain, no feelings, no involution.”

Although the term ‘lying flat’ seems to indicate that the movement is all about passivity and weakness, it is actually more about social skepticism and taking matters into your own hands. One WeChat article by blogger Mao Talk (2021) compared the lying flat movement to the views held by the Greek philosopher Diogenes who believed society placed too much value on status, wealth, and material possessions, and was determined to live a simple life. He did not work and never married.

The ‘Lying Flat’ cat (image via Zhihu).

The Chinese originator of ‘lying flat,’ according to Mao Talk, is the philosopher Zhuangzi, who advocated that the best form of being is without a “sense of self” (“no-self”) and “to go with the flow” instead of being driven by social intercourse and power structures. 

In an article published by the Guangming Daily in 2021, author Sun Xiaoting (孙小婷) also explained the Lying Flat movement in a similar light:

“Indeed, nowadays, people are able to look more dialectically at the various norms set by society and other people, and have a more multidimensional, tolerant viewpoint and wide-ranging definition of what constitutes ‘success’ and who is considered a ‘winner.’ They are also able to rationalize or even reject the values instilled by consumerism, success philosophy, and inspirational quotes, and they are brave enough to choose the lifestyle they believe is more comfortable. In fact, these young people who believe in ‘Lying Flat’ are not entirely like ‘salted fish’, and they are also different from the ‘Ge You Slouching’ and ‘Funeral Culture’ that appeared online a few years ago.3 Many of them have their own views on the meaning of life. They just do not want to be drawn into a social system where the order is already set up for them; they do not wish to get into this fast and crowded process in which people are traditionally pursuing the realization of “promotion and salary increase” and “buy a house and a car” through overtime work and other achievements. They are choosing to voluntarily withdraw from the pursuit of success and happiness within this social system, and the inner acceptance of the state of self is the preferred standard they are considering. This also explains why some young people quit their positions in big Internet companies and state-owned enterprises and choose to return to third- or fourth-tier cities to become ordinary coffee shop assistants or delivery riders, which means they take control of their personal time and regain more determinacy and leadership.”

Although the Lying Flat movement resembles the Buddhist Youth mentality and some other subcultures emerging over the past decade, there are clear differences.

Buddhist Youth mentality seems to come from a more negative mindset of anxiety and frustration, with people trying to find some sense of stability by adapting an ‘anything-goes’ attitude toward their life to protect themselves from disappointment and failure while they are perhaps still pursuing a path laid out for them by others. Those who believe in ‘lying flat,’ on the other hand, have readjusted their desires and goals for the future and decided to follow their own path.

 

Going Against the China Dream

 

Chinese official media tried to put an end to the diaosi trend after it first emerged by urging China’s young people to adopt a positive mindset, with state media outlet People’s Daily publishing an article titled “The Belitting of Oneself, Can We Give it a Rest?” (Zhou 2017, 243). Ever since the Lying Flat movement became an online trend, Chinese official media have also been condemning it.

In May of 2021, one commentary published by state media outlet Xinhua called the Lying Flat movement a “disgrace.” Although the article acknowledged the pressured faced by Chinese youth today, it stressed the necessity to uphold a confident and positive attitude. In 2022, ‘lying flat’ is still presented by Chinese officials and media as the road not to take.

In a recent interview with National People’s Congress representative Li Nannan (李楠楠) that was promoted on Weibo, the young delegate shared his take on involution and Lying Flat, urging Chinese youth to embrace competition and choose ‘involution’ over’ ‘lying flat’, since the latter is supposedly only about giving up and spreading “a negative atmosphere.” Another state media news report focused on Chinese under the age of 27 (post-95 and post-00 generations), their positive outlook on their career possibilities and their refusal to ‘lie flat.’

One reason why official channels label the ‘Lie Flat’ movement as such a negative one is because it goes against the ideals of the Chinese dream. The idea of the ‘China Dream’ has been ubiquitous in Chinese official media since Xi Jinping became president in 2013. The concept refers to a form of ‘national rejuvenation’ and a revival of the Chinese nation. At the National People’s Congress in March of 2013, Xi stated that, in order to achieve the Chinese dream “(..) we must spread the Chinese spirit, which combines the spirit of the nation with patriotism as the core and the spirit of the time with reform and innovation as the core.” He also stressed:

“In face of the mighty trend of the times and earnest expectations of the people for a better life, we cannot have the slightest complacency, or get the slightest slack at work.”

In the context of China’s road to rejuvenation, Chinese youth and young adults are seen as the “builders of socialism” who are supposed to contribute to the realization of the Chinese dream by having clear goals, strong ideals, and by working hard and actively start businesses and raise families. Youth subcultures such as the “Diaosi,” “Buddhist Youth” or “Lying Flat” are seen as having a negative impact on Chinese society since they allegedly do not contribute to a Chinese common ideal of socialism and reject the kind of lifestyle that is propagated by the Party (Wu & Ren 2018, 17).

Lately, the term ‘lying flat’ has also been used by official media in the context of China’s approach to fighting Covid19, following a surge in local outbreaks. While many other countries around the world are letting go of Covid19 measures, China is still adhering to its strict ‘zero Covid’ strategy, with millions of people facing yet another lockdown. It has triggered online discussions on whether the aggressive measures taken to prevent further spread of the virus are really the way forward for China’s Covid approach. But after the renowned Chinese doctor Zhang Wenhong stated that China cannot “lie flat” at this point of the Covid19 outbreak due to the potential death toll it might cause, a related hashtag went trending on social media platform Weibo (“Zhang Wenhong Does Not Agree with Lying Flat” #张文宏不同意躺平#).

The term was previously used in a similar way by the Communist Youth League, which published a post on social media titled “Modern-day Youth Should Never Choose to Lie Flat” (“当代年轻人从未选择躺平”). In their post, the League honored China’s young frontline health workers, soldiers, scientists, and those defending the motherland with their lives, writing:

“They have faith, they have dreams, they face the struggle, they are dedicated – they never choose to ‘lie flat’!”

“Contemporary youth [should] never choose to “lie flat”” online poster by Communist Youth League.

By construing a clear distinction between those fighting for the nation and those “lying flat,” Chinese media suggest that ‘lying flat’ is an unpatriotic act, a type of behavior that shows a lack of devotion to one’s country.

While those ‘lying flat’ are criticized, those ‘going against the tide’ are praised; nìxíngzhě (逆行者) is another buzzword from 2020 often used by state media to describe frontline workers and others as the ‘people going backward’, referring to those who dare to go back and face problems when everyone else is turning away.

‘Nìxíngzhě’ is a buzzword to describe the heroes going ‘backward’, facing the problems that others are turning away from.

The state media message that ‘lying flat’ is counterproductive seems to resonate with many online commenters. Although the movement was previously described as an “act of resistance” by Washington  Post and other media, there now seems to be more resistance against this form of resistance.

Nevertheless, there is still a huge group of netizens supporting the ‘lying flat’ movement for the ideas it represents. One Weibo user says that the ‘Lie Flat’ movement should be viewed as an online “collective emotional catharsis” that helps people pull through their everyday life. Another post by one popular blogger that recently gained some traction online said:

“The post-1990 generation has seen the Foxconn Suicides, they saw the tragedy behind the [Bytedance] worker who collapsed, they’ve seen the world and have now discovered, the most important thing is to live (..). The capitalist exploitation has forced young people on the road of a ‘Buddhist mindset’. Are they resisting capital or are they forced to ‘lie flat’? That’s the essence of the problem.”

One commenter responded: “We are living in a socialist country, but judging the way in which workers are treated it might as well be a capitalist society.”

Ironically, not too long after tǎng píng or ‘lying flat’ became a buzzword, news came out that Chinese tech giant Alibaba had applied for trademark registration of tǎng píng to create an e-commerce app by that very same name.

Many people mocked the move. One person wrote: “You are shameless.” Another comment said: “The implied meaning behind ‘lying flat’ is about wanting less and reducing consumerism, but you capitalists really seize every opportunity, you are even willing to squeeze the last bit of values out of young people.”

Despite the changing meaning and different views on the Lie Flat trend in China’s online environment, one Chinese news article on the issue recently captured a common ground: “We need to find a balance in between ‘involution’ and ‘lying flat,’ so that life can be full of colors while also leaving blank spaces, because you can only find your best life when you can find the balance between tension and relaxation.”

 

By Manya Koetse
Follow @whatsonweibo

Footnotes:

1 Title:  “The First Batch of the Post-90s Generation Has Taken the Cloth” (“第一批 90 后已经出家了”).

2 “躺平即是正义” (“Lying Flat is Justice”) was written by a blogger named “Kind-hearted Traveler” (好心的旅行家) on April 17, 2021. In the article, they described how they lead a minimalist lifestyle and explained the lying flat subculture as an alternative approach in life.

3 ‘Salted Fish Mentality,’ ‘Ge You-esque Slouching’ and ‘Funeral Culture’ are all buzzwords and online trends used by netizens since 2016 to express a sense of passivity and laziness in response to the ruthless job market and pressure to marry (also see Colville 2021).

References:

Colville, Alex. 2021. “Stop Trying to Make ‘Lying Flat’ Happen!” The World of Chinese, June 10 https://www.theworldofchinese.com/2021/06/stop-trying-to-make-lying-flat-happen/ [March 15, 2022].

Gong, Jing and Tingting Liu. 2021. “Decadence and Relational Freedom among China’s Gay Migrants: Subverting heteronormativity by ‘lying flat’.” China Information (December): 1-21.

Koetse, Manya. 2021. “The Concept of ‘Involution’ (Nèijuǎn) on Chinese Social Media.” What’s on Weibo, April 22 https://www.whatsonweibo.com/the-concept-of-involution-neijuan-on-chinese-social-media/ [March 13, 2022].

Mao Talk. 2021. “躺平主义:历史、现实、真相 [Lying Flat-ism: History, Reality, Truth.” WeChat, June 26 https://mp.weixin.qq.com/s?__biz=MzIxMDQ5NTQ3OA==&mid=2247483688&idx=1 &sn=9de2d27e74c354c91470436a9efe194c&chksm=9762f3b1a0157aa705ab15ca7f 4e6a7c8feaa8f8f448a4afae8a23db2c8009975a3b29fd2cee&scene=21#wechat_redirect [March 13, 2022].

Michels, Veronique. 2014. China Online: Netspeak and Wordplay used by over 700 million Chinese Internet Users. Tokyo: Tuttle Publishing.

Sun, Xiaoting. 2021. “拒绝’内卷’年轻人开始信奉’躺平学’了? [Refusing Involution, Are Young People Starting to Believe in ‘Lying Flatology’”?]” (In Chinese). Guangming Daily, May 15 https://mp.weixin.qq.com/s?__biz=MjM5NzM0MzQ4MQ==&mid=2654670779&idx =1&sn=f9e01056429a196c701a223580d2a1aa&chksm=bd14d62d8a635f3b42b2c6fe04175fd807d1017a6a0d030fbc7bc995cb8f36aaede7bfdf78f2&scene=0&xtrack=1#rd [March 14, 2022].

Sun, Jiahui. 2017. “How to Be a ‘Buddha-like Youth’.” ECNS, December 26 https://www.ecns.cn/learning-Chinese/2017/12-26/285916.shtml [March 12, 2022].

Szablewicz Marcella. 2014. “The ‘Losers’ of China’s Internet: Memes as ‘Structures of Feeling’ for Disillusioned Young Netizens.” China Information 28(2): 259-275.

Wu, Hongjuan and Ren Ying. 2018. “佛系青年”人生观误区及其引导 [A Brief Analysis on and Guidance for Fever in Buddha-like Youth]” (In Chinese). Journal of Wuhu Institute of Technology. 2018 (02): 15-18.

Zhou, Cao. 2017. “Internet Meme Songs in China and the “Diaosi” Identity of Youth Culture.” In: Ethnic and Cultural Identity in Music and Song Lyrics, Victor Kennedy and Michelle Gadpaille (eds), 241-249. Newcastle: Cambridge Scholars Publishing.

Any other sources not listed here are hyperlinked within the text.

Copyright: Goethe-Institut USA. Spotted a mistake or want to add something? Please let us know in comments below or email us. First-time commenters, please be patient – we will have to manually approve your comment before it appears.

Manya Koetse is the founder and editor-in-chief of whatsonweibo.com. She is a writer, public speaker, and researcher (Sinologist, MPhil) on social trends, digital developments, and new media in an ever-changing China, with a focus on Chinese society, pop culture, and gender issues. She shares her love for hotpot on hotpotambassador.com. Contact at manya@whatsonweibo.com, or follow on Twitter.

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2 Comments

2 Comments

  1. confuciuscries

    May 26, 2022 at 5:39 am

    ahhhhh. the acceleration of Convergent Devolution and its infiltration into society at large are finally in play. a big salute from our advanced degenerate brethren of the west who LDAR (ie ‘lay down and rot’) and from the 三和大神 in longhua, shenzhen. wuts next??? when will we all finally transform into balding h0mosexual post-op cockroaches?

  2. charles baer

    May 29, 2022 at 4:10 am

    I enjoyed reading this article .

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China and Covid19

Confusion over Official Media Report on China’s “Next Five Years” of Zero Covid Policy

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‘The next five years’: four words that flooded Chinese social media today and caused commotion among netizens who interpreted this as written proof that China’s current Covid strategy would continue for at least five more years. But the Beijing Daily editor-in-chief has since responded to the issue, blaming reporters for getting it all mixed up.

On June 27th, after the start of the 13th Beijing Municipal Party Congress, Chinese state media outlet Beijing Daily (北京日报) published an online news article about a report delivered by Beijing’s Party chief Cai Qi (蔡奇).

The article zoomed in on what the report said about Beijing’s ongoing efforts in light of China’s zero-Covid policy, and introduced Beijing’s epidemic prevention strategy as relating to “the coming five years” (“未来五年”).

Those four words then flooded social media and caused commotion among netizens who interpreted this as a sign that China’s current Covid strategy would continue at least five more years. Many people wrote that the idea of living with the current measures for so many years shocked and scared them.

Soon after, the article suddenly changed, and the controversial “coming five years” was left out, which also led to speculation.

Beijing Times editor-in-chief Zhao Jingyun (赵靖云) then clarified the situation in a social media post, claiming that it was basically an error made due to the carelessness of reporters who already filled in information before actually receiving the report:

I can explain this with some authority: the four-word phrase “the next five years” was indeed not included in the report, but was added by our reporter[s] by mistake. Why did they add this by mistake? It’s funny, because in order to win some time, they dismantled the report’s key points and made a template in advance that “in the next five years” such and such will be done, putting it in paragraph by paragraph, and also putting in “insist on normalized epidemic prevention and control” without even thinking about it. This is indeed an operational error at the media level, and if you say that our people lack professionalism, I get it, but I just hope that people will stop magnifying this mistake by passing on the wrong information.”

Global Times commentator Hu Xijin (@胡锡进), who used to be the editor-in-chief and party secretary of the state media outlet, also weighed in on the incident in a social media post on Monday. He started his post by saying that the reporter who initially made the phrase ‘next five year’ go viral had a “lack of professionalism” which caused the overall misunderstanding.

Hu also added a photo of the relevant page within the original report that was delivered at the Congress, showing that the phrase ‘the coming five years’ was indeed not written before the segment on China’s battle against Covid, which detailed Beijing’s commitment to its strict epidemic prevention and control measures.

But Hu also added some nuance to the confusion and how it came about. The original report indeed generally focuses on Beijing developments of the past five years and the next five years, but adding the “in the next five years” phrase right before the segment was a confusing emphasis only added by the reporter, changing the meaning of the text.

Hu noted that the right way to interpret the report’s segment about China’s Covid battle is that it clarifies that the battle against the virus is not over and that China will continue to fight Covid – but that does not mean that Beijing will stick to its current zero Covid policy for the next five years to come, including its local lockdowns and restrictions on movement.

Hu Xijin wrote:

I really do not believe that the city of Beijing would allow the situation as it has been for the past two months or so go on for another five years. That would be unbearable for the people of Beijing, it would be too much for the city’s economy, and it would have a negative impact on the whole country. So it’s unlikely that Beijing would come up with such a negative plan now, and I’m convinced that those in charge of managing the city will plan and strive to achieve a more morale-boosting five years ahead.”

After the apparent error was set straight, netizens reflected on the online panic and confusion that had erupted over just four words. Some said that the general panic showed how sensitive and nervous people had become in times of Covid. Others were certain that the term “next five years” would be banned from Weibo. Many just said that they still needed time to recover from the shock they felt.

“The peoples’ reactions today really show how fed up everyone is with the ‘disease prevention’ – if you want to know what the people think, this is what they think,” one Weibo user from Beijing wrote.

To read more about Covid-19 in China, check our articles here.

By Manya Koetse
With contributions by Miranda Barnes

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China and Covid19

The Curious Case of the Henan Bank Depositors and the Changing Health QR Codes

“It must be American hackers who did this, right?”, some Weibo commenters wrote in light of the miraculously changing Health Codes.

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Where can people turn to once their money seems to have gone up in flames? How could Health Codes randomly turn from green to red? And who will stand up for justice? These are the questions asked by Chinese netizens in the Henan bank depositors case that is making headlines this week.

This week, the story of a Henan banking scandal and depositors’ Health Codes suddenly turning red triggered online discussions in China and even made international headlines.

In between online deposit products, financial platforms, regional banks, and Health Code systems, the story is a bit messy. Here, we’ll explain the story and its latest developments.

 

DUPED DEPOSITORS

 

The story starts in April of this year when people discovered that they were unable to withdraw money they had invested in online deposit products offered by various smaller regional banks.

Some people had deposited money via the Baidu money app (Du Xiaoman Financial 度小满), others had used another third-party platform, intermediaries, or one of the mini-programs run by the banks themselves.

By early May, it had become clear that dozens of depositors who once thought they had invested their money wisely had actually been duped. Four of the banks involved are located in Henan province, namely: the Yuzhou Xinminsheng Village Bank (禹州新民生村镇银行), Shangcai Huimin County Bank (上蔡惠民村镇银行), Zhecheng Huanghuai Community Bank (柘城黄淮村镇银行), and the Kaifeng New Oriental Country Bank (开封新东方村镇银行).

But there are also other smaller banks involved, including Guzhen Xinhuaihe Rural Bank (固镇新淮河村镇银行) and Yixian Xinhuaihe Rural Bank (黟县新淮河村镇银行) in Anhui.

As reported by South China Morning Post by late May, multiple customers had confirmed that they had not been able to withdraw funds either online or in person.

The sudden apparent closure of their withdrawal channels set off a wave of panic among depositors, who then protested in the provincial capital of Zhengzhou on May 23rd, demanding the return of their money.

Yang Huajun (杨华军), deputy director of the Henan branch of China’s Banking and Insurance Regulatory Commission (CBIRC), arrived at the scene of the protests and – speaking through a megaphone – promised the demonstrators that as long as their funds were “legally” deposited, they would be protected by law.

Many depositers, however, were unsure of whether or not their deposits were actually made in a “legal” way and what the definition of “legal” entailed in this case.

Over the past years, Chinese smaller rural banks have partnered with online platforms, often offering relatively high returns, in order to boost their deposit-reliant funding base.

In December of 2020, platforms Alipay, Du Xiaoman Financial, JD.com and Tencent Wealth Management all suspended the sale of online deposit products via their financial apps in light of heightened scrutiny from regulators concerning funds raised by unstable smaller lenders.

The smaller banks that are now at the center of the recent financial scandal then (illegally) reached out to their existing customers directly after December 2020 and convinced them to download the banks’ apps in order to deposit even more money.

One of the persons duped is Mr. Sun from Shenzhen. As reported by Sina Finance, it was in 2020 when Sun came across a seemingly attractive online saving product via the Du Xiaoman Financial app. Although Sun was not familiar with the banks in question, namely the Yuzhou Xinminsheng Village Bank and Shangcai Huimin County Bank, he could not resist the deposit interest rate of 4.6%, which was much better than what the big banks were offering at the time.

In early 2021, Mr. Sun received a text message from Yuzhou Xinminsheng Village Bank saying that although the financial products had been taken offline, users would still be able to deposit through the bank’s own online application. Mr. Sun ended up depositing his entire savings into the Henan-based rural bank, thousands of miles away from his own home.

And then, earlier this year, Sun came across the news that Henan New Wealth Group, the primary shareholder of all banks involved, was under investigation for fraudulous practices. When he opened up his online financial application, there was nothing to see but a notice that the system was under maintenance. Sun could no longer access his funds. Hundreds of other customers were seeing the same empty screens.

According to media reports, the current suspected scam case affects some 400,000 customers of seven local banks and involves a money sum of 40 billion yuan ($5,6 billion).

 

IN THE RED

 

As thousands of depositors have been fighting to recover their savings over the past two months, they were duped a second time earlier this week. Dozens of affected depositors claimed they had seen their Health Codes turn red without any logical reason on June 13 or June 14 – the day of a planned protest.

In China’s Covid era, the Health Code system has become a pivotal tool in the country’s battle to contain the spread of the virus. The Health Code system is embedded in various apps, most importantly in Wechat and Alipay, and uses various data to assess an individual’s exposure risk. There is not one unified national Health Code application; they are developed by different actors and their management is different across Chinese provinces and cities.

If there is no detected risk, an individual is assigned a Green QR Code and is allowed access into any venue or location where a QR code scan is mandatory. With a Yellow Code, you should stay home for a week, and Red Code means you are high risk and need to quarantine for 14 days – this severely limits your freedom to move around and travel.

On June 13th, many affected investors saw their Health Code turn red when arriving in Zhengzhou, where they were allegedly coming to retrieve their savings and protest the injustice they suffered. The QR code color change was unexpected and strange, considering that there were no new reported Covid cases in their vicinity and also considering the fact that accompanying family members who made the exact same journey did not see their Health Codes change.

This raised suspicions that the duped depositors were specifically targeted, and that their Health Codes were being manipulated by authorities.

CNN reported that many distributors who had come to Zhengzhou were taken to a guarded quarantine hotel before being sent back to their hometowns via train the next day. According to a Chinese media report by Nanfang Daily, the depositors were not even asked to do nucleic acid testing and were told by local staff that they would get their Green Code back as soon as they left Henan.

Various media report that minimally 200 depositors saw their Health Code change from Green to Red earlier this week.

 

“OPERATION CODE RED”

 

The curious case of the Henan depositors scandal and the changing Health Code colors has become a trending topic on Chinese social media this week.

The topic of the duped depositors was also discussed online before this week, and it brought back memories of earlier financial scandals, such as the P2P chaos that occurred back in 2018.

But the topic of depositors’ Health Codes changing to Red is something that attracted much wider discussions on the apparent abuse of a system that has now become a part of everyday life for people in China’s Covid era.

The main proof for people that the Henan depositors were targeted in this apparent “Operation Code Red” is that, as mentioned before, the family members that were traveling together with the duped depositors never saw a change in their Health Code: those people who were listed on the affected regional banks’ depositors list were seemingly singled out and purposely targeted.

“Who is in charge of changing the Health Code colors?” became a much-asked question on Weibo, with many blaming local Henan authorities for abusing their powers to try and stop protesters from raising their voices in Zhengzhou. One Weibo post on this issue received over 1,6 million views. Meanwhile, Henan authorities still said they did “not understand” what had happened.

“It must be American hackers who did this, right?”, some Weibo commenters wrote, putting in a sarcastically smiling emoji, with others adding: “No, the aliens did this – it must have been the aliens!”

Others wrote that the situation at hand should be simple to figure out: “There is no way that this is an oversight or a data error. If you want to know who did this, look at who or which department has the authority to manage both epidemic prevention measures as well as finance affairs.”

Many comments also showed a sense of disillusionment with how China’s Covid management affects the people: “After seeing the chaos during the Shanghai lockdown, this does not even surprise me anymore,” one person wrote on Weibo: “All we can do is pray that it won’t happen to us.”

“Why is Henan’s “messy Red Code” incident so extremely vile and scary? Because once a person or institution holding public power looks at you in a bad light, they can give you a Red Code and take you away, in the name of legality. This is the evil that comes from unmonitored power,” one blogger from Anhui wrote.

Other people also worried about foreign media reporting on this issue, saying this incident is being used to cast China in a bad light while local authorities are to blame: “We should unify the Health Code system into a national system in order to avoid this from happening again.”

According to Chinese state media reports, the case has now been forwarded to the Health Commission of Henan Province for further investigation.

We will keep tracking upcoming developments. Meanwhile, check out our other reports on trending topics relating to China’s banking and finance here. For more about Covid-related trending topics, check here.

By Manya Koetse
With contributions by Miranda Barnes

Image via Weibo

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References (all other sources included in hyperlinks)

Lee, Amanda. 2022. “Rural Banks Freeze Customers’ Accounts.” South China Morning Post, May 31.

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