An investigation into Airbnb rentals in China

Transcript

NIALA BOODHOO: Good morning! Welcome to Axios Today!

It’s Tuesday November 30th. I’m Niala Boodhoo.

Here’s what you need to know today: the new lure of buy now, pay later online. Plus, on this Giving Tuesday - how one CEO views philanthropy.

But first, today’s One Big Thing: an Axios investigation into AirBnb rentals in China.

Airbnb is the latest company walking a tightrope when it comes to doing business in China and US sanctions against human rights violations there. Axios has found Airbnb has more than a dozen homes available for rent in China’s Xinjiang region on land owned by the Xinjiang Production and Construction Corps, an organization that's been sanctioned by the U.S. for its complicity in the genocide and forced labor of the minority Muslim Uighyr population. Bethany Allen-Ebrahimian is the Axios China reporter behind this exclusive. Hi Bethany.

BETHANY ALLEN-EBRAHIMIAN: Hi Niala.

NIALA: I think we should start with explaining the sanctions the U.S. government has in place in Western China right now. Can you tell us what's allowed and what isn’t?

BETHANY: This particular sanction against the XPCC, that's the Xinjiang Production and Construction Corps, prohibits financial transactions that relate to that organization and, prohibits transactions with any property or interests in property of that organization. So Airbnb has around 300 listings in Xinjiang. Of those, we have found that 14 are on land that is owned by the XPCC.

NIALA: What did Airbnb say to you about all of this?

BETHANY: Airbnb's position is that these listings are fine and are not violations of U.S. sanctions because this sanction only applies to the people that they are transacting with directly so this would be the host and none of the hosts as registered on Airbnb are the XPCC.

NIALA: And this XPCC, why have they been sanctioned by the U.S. government?

BETHANY: So the XPCC helps run some mass internment camps where a million or more Uighyrs are currently being detained and have been detained for several years. Uighyrs are being coerced to work in agricultural production and the XPCC is implementing that.

NIALA: Americans might be surprised to learn that in this Chinese region where there are also these forced labor camps, are there also tourists? Like there's a need for Airbnb?

BETHANY: Oh, totally. Yes, so Xinjiang has long been a pretty popular destination for domestic Chinese tourists. It has these beautiful desert landscapes. It also is a sort of a mishmash of different cultures, Uighyr culture, Kazakh Tajik, all these Muslim majority ethnic cultures. And so that's really popular among Chinese tourists to come and kind of experience these sort of different cultures.

What's happening though, is that the Chinese government is actively promoting and boosting tourism and Xinjiang is like an apartheid state almost. Han Chinese tourists, so people who are the members of the, you know, the overwhelming majority ethnic group in China can travel in Xinjiang pretty freely. They can go to tourist sites. They can book hotels. They can enjoy life there but Uighyrs mostly can't.

At least 10% of the population is currently held in mass internment camps. Of people who aren't, a lot of them are restricted to their cities. They can't leave their city without permission. Some of them are restricted to their neighborhoods. They are the subject of a surveillance state and for Airbnb to be operating there, you know, they are participating in, even if passively in an economy that purposefully shuts out Uighyrs because of who they are.

NIALA: I feel like we cannot end without talking about the winter Olympics because there has been discussion whether or not the U.S. would have a diplomatic boycott. I know that this, that earlier this year, a coalition of human rights organizations asked Airbnb to drop their sponsorship because of these violations. What has their reaction been to that?

BETHANY: Well, Airbnb certainly has not dropped their sponsorship. They also have not publicly criticized the Chinese government's human rights policies in Xinjiang as Airbnb has been asked to do by these human rights groups. But here's the situation that Airbnb is facing: Airbnb is kind of between a rock and a hard place because if they continue to operate in Xinjiang, which is certainly what the Chinese government wants, Airbnb is going to continue to face high regulatory risk from a U.S. legal perspective, and they're also gonna have a high reputational and moral risk. However, if they pull out of Xinjiang, it's really possible that the Chinese government and even the Chinese populace might react very harshly to that and they will, you know, face revenue loss.

NIALA: Bethany Allen-Ebrahimian is a China reporter at Axios, and she's got all of this reporting online as well. Go to axios.com to read that. Thank you, Bethany.

BETHANY: Thanks so much. Niala.

NIALA: One disclosure for our listeners: An Airbnb executive is a member of Axios' board of directors.

In 15 seconds, the new online retail layaway.

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NIALA: Welcome back to Axios Today! I’m Niala Boodhoo.

If you did any online shopping yesterday for Cyber Monday, you may have seen the “buy now, pay later” option that lets you spread out purchases over a long period of time without needing a credit card. Axios business reporter Erica Pandey has been writing about these new virtual IOUs and is here to fill us in. Erica, this is a big trend now in online shopping, are a lot of people using it?

ERICA: I was seeing the option everywhere as I was online shopping. And then, I realized that it's a huge trend because Adobe Analytics just has new data out that shows that the number of purchases Americans made using those “buy now, pay later'' options increased 438% between November, 2019 and November, 2021. So this thing is really exploding.

NIALA: So, is this like the layaways I used to see in department stores when I was a kid, which did have some downsides? Right?

ERICA: Right, the big number one downside being that it can encourage people to finance purchases that they can't afford. A lending tree survey recently found that two-thirds of Americans said that they spent more money using “buy now, pay later” apps and they would have other.

NIALA: But to be fair, you're also not paying interest on these. Right?

ERICA: Exactly. And that's why they've gained so much popularity. It’s because you're just paying the same price in four installments.

NIALA: Happy shopping, Erica!

ERICA: Happy shopping, Niala.

NIALA: Ok, it is actually though Giving Tuesday - a day meant to be an antidote to all that shopping. Brett Shulman is the co-founder and CEO of the fast casual restaurant chain CAVA. He told me: philanthropy is how the company introduces itself to the communities they’re in.

BRETT SHULMAN: We've donated over $150,000 this year and served over 50,000 free meals to the communities we've opened. We, we now operate in 160 communities and as you noted, it's growing by the week, to make an impact at a grassroots level with our food and with our service. We like to talk about our spirit of generosity and, really in a, in a world with a lot of uncertainty, the ability to come in and engage with our team and for our team to deliver some positivity and kindness can make a really big impact. We like to say it doesn't cost anything to be kind.

NIALA: But it does cost, um, things to be, as you’re talking about donating food or your employees’ time, that is part of your bottom line. How do you weigh that cost, especially when you think about how tight the margins are in your industry and how tough economic conditions are right now?

BRETT: Yeah, I don't think giving should be looked at as an expense or a tax deduction. Right? It's an investment in, in our team, in our guests, in positive emotions, in gratitude and in building relationships and strengthening those relationships because what you give gives back to you and then some.

NIALA: You can hear the whole conversation as part of An Axios Event I’m doing this afternoon for Giving Tuesday. I’ll tweet out the link, and we’ll include information in our show notes if you want to tune in online.

That’s all we’ve got for you today!

I’m Niala Boodhoo - thanks for listening - stay safe and we’ll see you back here tomorrow morning.