i haven't been reporting in such a long time here. But I'd hate to come back on board and report news about our favorite trade that's bad. But I must say that things are quite serious right now.

As you have all heard of the recent raids going on in DG where they deployed more than 6500 cops to raid all of the five townships in DG to set an example after Beijing's CCTV underground reporters blew the whistle on DG's rampant sex industry. It's strange to me that CP, the real sex capital of DG was not mentioned in all of the articles. Instead all of the surrounding places like Sheraton in Houjie and Crown Prince of Huangjiang was singled out in this raid.

regardless, CP is feeling the real affects of these raids. Basically it has spooked the whole entire town. In my years of mongering in CP, I have rarely seen such a raid that has put CP on a complete standstill. All KTVs and Saunas are closed. Even regular KTVs with no girl's sitting with you like Sing Party and Dragon KTV by Liang Bang is closed. To top it off all footie establishments that do not even sell sex like pozilim footie has temporarily closed down for it's second day in a row. In addition, Taxi Drivers have lowered their rates down to 10 RMB from the usual 15RMB. To top it off, taxi drivers are really feeling the pinch as they have absolutely no customers during the night time at all.

You still see that there will be a complete ripple effect felt throughout the region, especially DG area. There are already estimates that more than 200,000 jobs ( WG not included in this figure) will be lost as a result to the complete shut down of these sex trade industries. This includes jobs related or indirectly related to this industry such as to the manager who books your room, to the housekeeper who cleans your bed, to the waitress that use to serve you food at restaurants and more. Businesses will start to shut down that use to thrive on mongers coming into town to spend and WG who use their disposable income to spend and help circulate their money into the local economy.

It's really never been this bad. In the past Yanda (yearly raids) always occur; however, never at this strict and extreme of a shut down of all mongering venues. In the past you could still go to saunas from the backdoors, and KTV's would still be operating. However, this raid was even worst than the raid in 2012. This raid has spooked everyone! Sauna Managers who use to post up pictures of their Sauna girls have taken all of their wechat moment posts down and some have just quit and went back to their home town for the the next 6 months or so. KTVs which when you think about the overall scope of things is the one venue that employs the most amount of WG, even more so than Saunas and BBS, even they are all shut down.This raid has been announced to last for 3 months. In addition, the timing of this raid is also the worst! Just when all the WG spent all their money back home for CNY, they come back to CP or DG with no job and no prospect of earning money. There is an air of desperation right now in CP. I've had 5 girls on wechat who are desperate for money asking where I am and if I can come take them out of CP and just travel and get away from the tense atmosphere of CP. The police has been knocking doors down at random hotel rooms in DG and questioning couples if they really know each other or is one party a WG. There was a news article where a real local DG couple was arrested and taken to the police station for questioning and they were both later on released when the police realized that they were in fact a real couple and not a John trying to be with a prostitute. So this will have a deep impact to the mongering landscape of DG for the months to come. Even if there were some places still open (which there is not) most mongers would think twice about coming to DG where there is no place, even your hotel room to be able to have sex in.

I am not looking forward to how this will impact DG in the coming months. As all i see if, if this raid does blow over, it'll be harder to recruit girls, and as a result prices will rise yet again to attract new talent to town. I don't think the world's oldest profession will ever go away, it might just be more underground for the time being.

My advice is to stay away for a while. At least until this event and news starts to die down. Now that it has been made viral and into a national debate, there's just too much heat in DG at this point. As I have always said, Happy Mongering, but stay safe.


AsnDragon

I think it could have been a lot worst. Just think if the raids happened just 2 month later or early.  Lucky most girls around 80% went home for CNY. I would expect most will now stay home a little longer.  I am sure most place were on a hoilday staff for CNY and have not returned back to work.

Taxis back to 10 rmb. If the situation doesn't improve, hotel might start having speicals lower prices.

If anyone have numbers call them, wechat, qq, email etc. I am sure the girls are happy to hear from you. I think most will even give you a discount or you can bargain  

Any information on what cities police were knocking on doors ?

edit for typos

[ Last edited by  Weelock at 13-2-2014 16:02 ]

The economy of CP seems very dependant on prostitution, but the rest of DG is a little less so.  It is still mostly a factory town.

My WG contacts in CP are currently on holiday (having worked Spring Festival), but I will see if the managers have told them anything about returning.

I do feel bad about all the support workers (maids, taxi drivers, etc.) but most of them have been through versions of this before.  It might all blow over or it might not.  Since there is nothing any of us can do about it, it just seems silly to proclaim the death of DG ater just a couple of days.

I would be interested in knowing how this is affecting the rest of GD.  Guangzhou and Zhuhai are so dry already that I doubt there will be much impact, but what about SZ?

What about big KTV join such as Eurasia, Mayflower? Any bros in CP ATM can confirm if they still operates and if yes does the crackdown change their operation? Eg: lot less girls on line up?

The prices in cp may finally come down cuz of this. It may come out to be good for mongers but we will have to wait n see

Side effect is that HK and Macau will be flooded with girls?

Actually the opposite will likely occur. As WGs and mongering establishments become scarce, prices increase. Look at SZ and ZH.

It's already happening in DG with touts quoting inflated prices.

Was here in Shenzhen all week.  Beginning of this week, things were normal, clubs, sauna, massage places, KTV, all working as normal.  After Thursday, this place is dead at night, most places are closed like KTV here.  Any massage places you go to (I went to 2 in last 2 days), both say, no special service.  Only massage, the window can't be covered in private rooms.  Everyone scared for raid at any moment.  Even during work and visiting supplier this week, people that I never talked to about "night life" bring this up and companies have posted warnings about getting caught and getting fired if they are.  Many say this has never happened to this level here, fearing the worst in the economy and the ripple effect mentioned...

A friend of mine in Dongchen just mentioned that the bar street is closed for 3 months.  This street is fairly famous for bars, clubs, and restaurants, but there has never been any action available there.  So it's very strange it is shut down.  It's hard to believe they are targeting regular bars.

http://www.youtube.com/watch?v=PhY-VzOcIL0

According to this video, the main reason for this action is to destroy the factions that support Zhou Yong Kang who was BXL's mentor. Perhaps after the umbrellas that report up to ZYK are disbanded the new umbrellas that support the CORRECT government bodies will come into play

Bro Kaleu,

Perhaps these bars were closed as they may have connections to people the LE are after? I am only assuming this though...

Obe

It's possible.  However this bar street is located just outside the gates of an expat community called New World Gardens.  It's mostly a foreigner hang out area including 3-4 dance clubs, maybe 6 bars, and a bunch of foreign restaurants.  For example, it has the only Mexican restaurant I know of in DG.  Now I'm not sure if the restaurants were closed.

So it is a very high profile thing to do (in that community).

But, staying with the topic of this thread, these guys are loosing 1/4 of their anual revenue (plus the bar staff, cooks, dishwashers, suppliers...) and they didn't really participate in this "vice."  They still have to pay for rent, loan payments, insurance (maybe)...

It's going to be very bad for the economy.

Obe-- anything on DS? Well two of my DS regular Sauna girls are in hiding. One is even considering on going overseas on student visa as there is no sauna open in DS for them to work at. DS economy has been on the downturn ever since last year as business has been hit quite bad with anti prostitution campaigns all over the place. DS is also another place that is heavily reliant on the sex industry.



AsnDragon

I wonder if this is to the level of something worth shorting some stocks over...I'm not sure which sectors would be best. Any finance bros out there?

Like I said many times before, China doesn't want to be known as a sex capital or attactiion to the world.

WAS there just one reporter from CCTV that did ALL this damage ?  There might be a contract on his life from the traids now.

==========================================================================

http://www.scmp.com/news/china/a ... -crackdown-analysts

Prostitution clampdown on Dongguan may knock 50 billion yuan off its economy

The crackdown on Dongguan's vice trade may cost city businesses, including hotels, shops and restaurants, at least 50 billion yuan (HK$63.5 billion) - or one-tenth of the local economy - analysts said.

The raids were also seen as a warning from the central government to provincial authorities to put a higher priority on tackling corruption and upholding moral standards after decades of economic development.

Dongguan, a city of 8.2 million that sits between Shenzhen and Guangzhou, has been in the spotlight since China Central Television aired an exposé on its thriving sex industry on Sunday. Afterwards, the city mobilised more than 6,000 police to raid nearly 2,000 entertainment venues.

Guan Qingyou , a senior economist for Minsheng Securities, said in a note to investors that about 50 billion yuan - or at least 10 per cent of the city's gross domestic product - could be wiped out due to the crackdown.

"The sex industry relates directly or indirectly to many industries including hotels, restaurants, cosmetics, daily necessaries, travel and so on," Guan said.

"Fifty billion yuan is a general estimate by many research institutes of the volume of Dongguan's sex trade."

Lin Jiang, dean of the finance and taxation department at Lingnan College at Sun Yat-sen University and also a consultant to the Dongguan city government, said the figure was credible.

"It's a reasonable estimate, but I'm afraid the actual figure could be even higher," said Lin. "It will have a serious impact on the local economy. The crackdown will also hurt investors' confidence and weaken the city's long-term economic growth."

Guan also warned the crackdown on the sex industry might be echoed nationwide.

"Some people might underestimate the resolution of the leadership, but we should take seriously the impact of the Dongguan case on the larger economy. We may see the impact in national economic statistics as early as March," he said.

Other observers have expressed doubts about how far the campaign against prostitution will spread.

"With so many police officers and government officials deeply involved in the industry, I doubt the crackdown will get all of them," said Xiao Gongjun, a former researcher at Shenzhen University and a factory owner in Dongguan.

==============================================================================

http://www.chinadaily.com.cn/opi ... ontent_17277525.htm

Dongguan: “Sin City” and economic restructuring
Updated: 2014-02-11 17:36
By Xin Zhiming ( chinadaily.com.cn)


Despite its global status as a major hub for electronic manufacturing, Dongguan, a third-tier southern city, would still be unknown for many if not for the recent crackdown on the illegal sex trade in the city.

The underground industry reportedly accounts for a significant portion of the local GDP, although no authoritative figures are available. Some reports claimed the sector, together with related services, could account for 10 percent of local output. If the crackdown continues, local authorities urgently need to find a new growth path to ensure the economic stability of the city.

Actually, the city was once known more for its electronic manufacturing than the sex industry. From late 1990s to the eruption of the global financial crisis in 2008, the city was a major base for global manufacturing of IT products and electronic equipment, accommodating a large pool of manufacturers and industrial workers.

In the wake of the global financial crisis, the city suffered from slumping foreign demand. Rising domestic production costs have further reduced its corporate profit margin.

Like many other cities in the Pearl River Delta cities, Dongguan faced the challenge of economic restructuring, shaking off its past growth centered on low-end manufacturing and embarking on a new path built on high technology and managerial updating.

The region, including Dongguan, started restructuring as it fought fallout from the global financial crisis. In Dongguan, for example, there is increased investment that encourages corporate research and development to improve the competitiveness of the local enterprises.

The process is still going on and, given the difficulty of such a restructuring, could take many years to materialize. It is part of overall national economic restructuring, an endeavour that China has placed all its bets on.

The sex scandal has put the city in the spotlight. It will force the city — now a hub of vice in the eyes of many — to accelerate restructuring to shake off its public image as the “sex capital of China.”

[ Last edited by  Weelock at 15-2-2014 21:53 ]

Do people think this will result in more girls in HK? I am not so sure, seems that getting travel papers and passports can be difficult for many of the WGs in CP. Especially true of BBS girls who have no proper travel paper to allow them to travel to/from CP by China Rail.

What do others think?

Weelock--- Personally, I think the sex trade in DG is more than 10% of it's GDP. Sure there are places like Chang An and Houjie that have thriving factories of different tech and textile sectors. However, DG has the most amount of star hotels in the nation only behind Shanghai and Beijing. A third tier city to have that many hotels signifies that the sex trade is significant part of the economy. I believe the GDP numbers would be closer to 25%. I'm talking about Hotels, Restaurants, Clothing stores, foot massages, Saunas, Shopping Malls, Movie theaters, Supermarkets, taxi drivers and Real Estate in general all taking a significant hit! You take a look around DG towns, which I've been to 20 of the 26 or so towns and it is just pitiful! Shopping malls closing down, restaurants, movie theaters where movies are cancelled because there isn't enough customers to watch and they cancel it to save electricity and hardware stores all closing shop with empty apartments and retail fronts all over....and this is BEFORE this crackdown. Can you imagine how bad business would be overall after this crackdown?

Sure there is still a manufacturing sector in DG; however, you have to realize that many people came to DG to set up factory not just because of it's relatively easy logistics, but also because DG has a bustling sex industry. That's how DG was able to attract investors in the first place. It was so boring back 30 years ago that they needed to provide entertainment for business investors and factory owners to pass time and thus allowed all of this illicit sex industry to blossom. Otherwise there tons of other places in China where labor is cheaper and overhead is lower to set up your factory instead. For those of you who are in import export industry or manufacturing, you all know that zhejiang Yiwu has already outprices DG manufacturing sales prices by at least 10% or lower. Meaning you can get the same exact product in Yiwu as in DG and it's 10% and sometimes even 30% cheaper. Guangdong with it's high overhead and fix costs as well as high labor costs no longer has the competitive advantage to compete with other provinces. But people still come to DG to set up factories because sex is much more readily available. If you take this competitive advantage away then DG economy will crumble from the inside.

DanShui in Huizhou did the same tactic to try to attract investors to set up factories there by offering saunas in all the hotels there. They realized the easiest way to attract investors was to lure them in by sex. Thus you saw that there were up to 50 plus saunas a few years back. After this crackdown it'll hit DG an DS especially bad.

You have to realize there is no real reason to set up factories in DG. The factory rental and fixed costs are expensive and you can't even get factories to work for you for less than 2500 RMB these days and it's harder and harder to find workers. Whereas other provinces are relatively poor and wages are lower, and their local govt give you kick back and incentives to set up factories there and employee retention is higher because they aren't too far from home.

So as I see it, it's more of a domino effect. Factories owners buy up or rent real estate from local Dongguan people which help the economy have capital influx. Then they higher employees which also need to spend and thus help local stores nearby. Employees at factories want a better life and become a WG and it's easy to become one in DG. Increase in quantity of WG helps DG attract mongers to town which increase fix asset investment like Hotels and apartments and taxi drivers. Mongers bring money into town to spend and romance the WG which help with restaurants, footies, shopping malls and movie theaters. Monger wants to sponsor a WG and that helps with apartments and real estate and also rental rates. Mongers essentially put forth tons of money from outside DG or China to stimulate the local economy. Now..you take away the WG from the equation and then you see how it affects the whole dynamics. Raids=No WG= No MOngers= no money for restaurants and stores=making DG more like a ghost town and causing fear from immigrant works=no factory workers= increase in wages from factory owners to attract workers=factory owners closing down shop because they are not competitive= local DG people lose rental income from factory, store fronts, apartment buildings= financial catastrophe.


just my two RMB on this issue


AsnDragon

maybe it is time to explore other places in the world
check out angeles city or bangkok

Neither of those places are as good as CP IMO. They are not bad, but I think the quality of the girls, the range of services, the range of venues, the range of the quality of the venues (5* down to grubby BBS) makes CP THE best mongering spot on the planet. And, I don't even speak Chinese.

im going to have to disagree to a certain extent
u can go to a place like BKK and have as many options as CP
its just not as centralized as CP but close enough
but the main reason is language, value and travel
u can find a chinese, japanese, korea, and thai chicks in bkk
i doubt u get that much diveristy in CP and u need to speak chinese to realistically get what u want
u can eat, party, sleep, drink at a cheaper rate in bkk than CP
there are actually real things to do as far as tourism in bkk,
but going to CP has no cover story,

i had to cut out down my CP trip to half a day because i had so much fun in bkk and philippines
the best value  in  CP are the saunas

[ Last edited by  jsmithj88 at 16-2-2014 11:59 ]