Tuesday February 19, 2019
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Enter the dragon: Is China looking to colonize Kenya and rest of the East Africa?

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By Nitin Kesar

The way Chinese people are making inroads into Kenya, has a striking resemblance to how British paved their way into India during early 17 century.

With a promise of investing $5 billion in Kenya’s infrastructure, China has done exactly the same thing what East India company did then with India- show a false promise of prosperity and growth.

One of the reasons why China is so interested in Kenya is for its need of oil. As the dragon nation is set to become the world’s largest oil importer, the new oil discoveries in Kenya serve its purpose well.

It is estimated that the Kenya will be the first oil exporter in East Africa by 2016 — with deposits topping 10 billion barrels, or three times more than the United Kingdom’s remaining oil reserves.

Again, it is just like the way Britishers exploited Indian farmers for opium, cotton and spices.

The signs of this modern day colonization showed its horrific side on March 26 when a Chinese restaurant in Kenyan capital of Nairobi was shut down after it emerged that it was barring dark-skinned locals from entering its premises.

The case came into limelight after furious residents took to social media to denounce an apparently racist policy of not allowing African patrons to eat there after 5pm.

This is exactly what happened in India after Anglophone masters took control of the sub-continent and debarred the natives from entering restaurants. In fact, this was the time when Britishers used to put a board outside their so-called English eating joints which read- Dogs and Indians are not allowed.

Though Chinese investment at this moment seems like a good relief for Kenyans, it is going to have a great impact on the African nations sovereignty and autonomy.

A report conducted by Jomo Kenyatta University of Agriculture and Technology (JKUAT ), Nairobi, Kenya also suggested that the FDI from China can have adverse effects on employment, income distribution, and national sovereignty and autonomy.

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Chinese Police Catches Hold of $1.5 Billion Money in Online Lending Scandal

The internet has helped financial platforms attract money from financial novices with little knowledge of the risks involved.

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Chinese policemen watch as depositors from Ezubao gather outside the State Bureau for Letters and Calls Reception Division office in Beijing, Jan. 1, 2016. China's policy ministry says it investigated 380 online lenders following an avalanche of scandals. VOA

Chinese police have investigated 380 online lenders and frozen $1.5 billion in assets following an avalanche of scandals in the huge but lightly regulated industry, the government announced Monday.

Beijing allowed a private finance industry to flourish in order to supply credit to entrepreneurs and households that aren’t served by the state-run banking system. But that threatens to become a liability for the ruling Communist Party after bankruptcies and fraud cases prompted protests and complaints of official indifference to small investors.

The police ministry said it launched the investigation because person-to-person, or P2P, lending was increasingly risky and rife with complaints about fraud, mismanagement and waste.

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The police ministry said it launched the investigation because person-to-person, or P2P, lending was increasingly risky and rife with complaints about fraud, mismanagement and waste. Pixabay

The ministry gave no details of arrests but said more than 100 executives were being sought by investigators and some had fled abroad. It said authorities seized or froze 10 billion yuan ($1.5 billion) but gave no indication how much might be returned to depositors.

Police say some lenders and investment vehicles were brazenly fraudulent, while others collapsed after inexperienced founders failed to manage risk.

Monday’s statement said P2P lenders were investigated for complaints including wasting money, reporting phony investment plans and using illegal tactics to raise money.

Lending through online platforms grew by triple digits annually until 2017 when regulators tightened controls.

Depositors lent 1.9 trillion yuan ($280 billion) last year, but that was down by 50 percent from 2017, according to the Shenzhen Qiancheng Internet Finance Research Institute.

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The internet has helped financial platforms attract money from financial novices with little knowledge of the risks involved. Pixabay

The outstanding loan balance stood at 1.2 trillion yuan ($177 billion) at the end of 2018, down 25 percent from a year earlier, according to Diyi Wangdai, a web site that reports on the industry.

P2P lenders are part of a privately run Chinese finance industry the national bank regulator estimated in 2015 had grown to $1.5 trillion.

The internet has helped financial platforms attract money from financial novices with little knowledge of the risks involved.

Many lend to factories and retailers or invest in restaurants, car washes and other businesses. But inexperience and poor risk control means a downturn in business conditions can bankrupt them.

Also Read: Sales of Smart Feature Phones Expected To Be About $28 Billion Over Next Three Years

Finance as a whole has come under tougher scrutiny after a 2015 plunge in stock prices led to accusations of insider trading and other offenses.

In one of China’s biggest financial scams, authorities say depositors lost 50 billion yuan ($7.7 billion) in online lender Ezubo before it was seized by regulators in 2015.

The founder and his brother were sentenced to life in prison in 2017. (VOA)