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China scandals call for more regulation of tech companies

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STEVE INSKEEP, HTE:

A lot of Americans wonder if big tech companies are too powerful, and it turns out people are asking a similar question in China. Just like in the United States, technology companies in China are essential to economic growth. But in China, recent scandals have changed that. This is NPR’s Emily Feng.

EMILY FENG, BYLINE: January weather in Beijing steadily drops to sub-zero temperatures. That doesn’t stop dozens of angry homeowners lining up in front of this Beijing office every day. Here is one of them.

UNIDENTIFIED OWNER # 1: (Via an interpreter) This problem between owners and tenants, we are at the end of the roll.

FENG: These owners line up outside the offices of Danke, one of China’s largest rental startups. It has rented more than 400,000 apartments, mainly around Beijing. Danke is aimed at young tenants looking for inexpensive housing. He even gave them loans online if they couldn’t pay their rent up front. But this winter, Danke went bankrupt. It took the money from the rent but stopped paying the landlords, who then evicted their tenants. Here is another owner. They wanted to remain anonymous because they always ask Danke for money.

UNIDENTIFIED OWNER # 2: (Via interpreter) Frankly speaking, the state did a bad job of regulating, and Danke put this tenancy dispute on our shoulders.

FENG: Allen Wang moved to the Shenzhen Technology Hub after graduating from college. When Danke went bankrupt, his landlord confronted him outside the apartment.

ALLEN WANG: (via interpreter) The guy she brought with her was a locksmith. It was the first time we met the owner.

FENG: They managed to compromise that day, but Wang had to move out early and lost almost a year of rent – and his naivety.

WANG: (via interpreter) I now have a much deeper understanding of capitalism. The evils of capitalism, the disorderly growth of these companies, cost ordinary people dearly.

FENG: Dissatisfaction with the rampant version of capitalism in China is also why many are supporting regulatory action against Ant Group. Ant is headed by Jack Ma, China’s best-known entrepreneur, and the company has grown into one of the most powerful financial firms in the world. It processes billions of dollars in online payments per year. It contains huge amounts of consumer data. This led to accusations that he ousted competitors and granted predatory loans to consumers.

Ant was set to go public in Hong Kong and Shanghai last November and become the world’s largest IPO. Until…

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UNIDENTIFIED JOURNALIST: It all seems to be going up in smoke this morning.

FENG: Ant’s registration has been postponed indefinitely. As of this month, Alibaba, Jack Ma’s other company, has been the subject of an anti-monopoly investigation. And although it costs mom and pop investors, many people in China have gone online to express support for regulators, not Alibaba.

XU QINGDUO: I hope they can learn to compromise or find a balance between seeking profit and taking charge of their employees.

FENG: Xu Qingduo is a Beijing-based political analyst. He says a series of other e-commerce scandals have fueled social discontent. Among the scandals, a delivery man working for an Alibaba-owned company set himself on fire this month in protest over unpaid wages.

XU: There are labor laws to protect the interests of delivery drivers, but there seems to be a lack of proper implementation in real life.

FENG: Last January, an employee of Pinduoduo, a Chinese e-commerce startup, suddenly passed away after working 380 hours a month. His death and the company’s unapologetic attitude sparked a public outcry.

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UNIDENTIFIED PERSON: (Non-English language spoken).

FENG: This is another Pinduoduo employee who was fired after criticizing the company’s working conditions online. He, like many employees, says they have to work at least 300 hours a month.

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UNIDENTIFIED PERSON: (Non-English language spoken).

FENG: It’s an extreme version of 996, the Chinese term for working 9-9, six days a week. It’s a common schedule in tech companies, where more and more young graduates and migrant workers are employed.

Suji Yan is himself the founder of a tech startup. He is also an advocate for humane working conditions in technology. Two decades ago, smartphone and textile factories had the worst working conditions. But now it’s the tech companies.

SUJI YAN: People actually realize it’s not just about factory workers. In fact, it’s going to be linked to everyone.

FENG: Everyone, that is to say, it’s also time to take stock of the tech industry in China.

Emily Feng, NPR News, Beijing.

(SOUNDBITE OF PHILANTHROPE’S “RELIEF”) Transcript provided by NPR, Copyright NPR.

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