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I lived in china as well and they do have a race problem.

The ad is racist because of the context of the chinese attitudes to black people (Which they don't hide much). Anyone with dark skin in china is deemed bad, very unattractive, criminal, and poor.

It's normal for chinese people too say, 'I'm not racist I just don't like black people'. I've had conversations where people have seen photos where I'm eating with a black person and said, 'ewww, a black guy.' with extreme disgust and not realising there anything remotely wrong with acting that way.

Many people there don't have a very well developed sense of what racism is in most of the country. It's normalised and they don't question it. There's bigotry in china between chinese people of slightly different skin tones. Actual black people make them crazy.

The ad it ripped off was comparing a white slob to a black body builder in a culture where white people are the norm and made for a largely white audience. This compared a scruffy black guy in a culture that often overtly dislikes black people to a pale skinned chinese guy.