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Charity gives way to scepticism in China


THE feeding frenzy for the pandas comes at nightfall. People furtively approach them, pouring bags of old clothes down their gullets. By day, the trucks arrive to clean the bears out, leaving them empty for the next big meal. The pandas are plastic. They are large, bear-shaped receptacles, designed to entice people to donate their unwanted garments to those in need. First deployed in 2012, there are now hundreds around Shanghai, often placed by entrances to apartment buildings. They swallowed about a million items of clothing last year.


The procession of donors feeding trousers to pandas is impressive. But they usually do so under cover of darkness. Charitable giving is not yet a middle-class habit. Many people still feel awkward about it, despite their growing prosperity. China's GDP per person is about one-seventh of America's. But in 2014 Chinese gave 104 billion yuan ($16 billion) to charity, about one-hundredth of what Americans donated per person.


The middle classes have worries too—that giving large amounts to charity may draw unwanted attention to their wealth. They do not want to fuel the envy of the have-nots or encourage tax collectors to pay them closer attention. The top 100 philanthropists in China gave $3.2 billion last year, according to Hurun Report, a wealth-research firm based in Shanghai. That was less than the amount given by the top three in America.



For Yang Yinghong, general manager of Yuan Yuan, this con was just the latest in a series of challenges. Lest people be tempted to put their refuse in the donation boxes, he came up with the panda design and made the animals translucent so that passers-by could see that clothes were piling up inside them. The pandas' eye-catching visibility has had an unfortunate side-effect, however. Mr Yang says people prefer to drop off their donations at night because others may think badly of them for giving away perfectly wearable clothes.


The China Philanthropy Research Institute estimates that fully 80% of donations by the wealthiest Chinese go to overseas charities. Many may well prefer to give to local causes, but regulations have hindered the development of philanthropy at home. To function as a not-for-profit organisation, charities must have a government partner, which entails the loss of their autonomy. It is also difficult for them to obtain tax breaks for their donors.


But this will soon change. The government published a draft law on charities in late October. Under discussion for a decade, it defines charities broadly, and acknowledges that they can help improve everyone's quality of life. The law promises to allow charities to register directly, rather than work through an official partner. They may also enjoy tax exemptions. Zhu Jiangang of Sun Yat-sen University in Guangzhou says the law should help reduce the influence of government, and thus encourage charities to flourish. It is expected to be approved soon.



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