The Communist Party’s State Administration of Market Supervision announced on April 10 that it had imposed a penalty of 18.228 billion yuan ($2.8 billion) on Alibaba for its “two-for-one” monopolistic practices. Foreign media reported that the Chinese Communist Party authorities may require Alibaba to sell its media assets, including the South China Morning Post. Who actually controls the South China Morning Post? Why has it frequently made verbal attacks on Xi Jinping and his cronies, and why did it manage to get top secrets at the 19th Communist Party Congress? The Chinese Communist Party recently interviewed the Ant Group, a secret list of the powerful coterie behind the Ant Group, and Xi Jinping was very angry when he read it. Jiang Zemin family funds, 2 years ago has been quietly transferred to Singapore. Xi Jinping crackdown on Alibaba, the deeper reason is to deter Jiang Zemin and Zeng Qinghong, for the layout of the 20th National Congress?
Huge Fines
On April 10, the Communist Party’s State Administration of Market Supervision announced that it had fined Alibaba 18.228 billion yuan (US$2.8 billion) for monopolizing the market for online retail platform services in China. The boots have finally fallen!
It started last year when Jack Ma sharply criticized the Chinese Communist Party’s financial regulatory system when he attended China’s second Bund Financial Summit on October 24, when, in addition to Ma, top Chinese Communist Party officials, including Vice President Wang Qishan, Central Bank Governor Yi Gang, former Central Bank Governor Zhou Xiaochuan and SFC Vice Chairman Fang Xinghai, attended the summit.
On November 2, 2020, the website of the China Securities Regulatory Commission (CSRC) released the news: “Today, the People’s Bank of China, China Banking and Insurance Regulatory Commission, China Securities Regulatory Commission, and State Administration of Foreign Exchange conducted regulatory interviews with Ant Group’s de facto controller Jack Ma, Chairman Jing Xiandong, and President Hu Xiaoming.” That night, the news spread throughout China’s financial and media circles, quickly sparking heated debate.
On November 3, 2020, the SSE sent a notice to Ant Group, calling a halt to Ant Group’s listing plans.
Now, some Ali executives are breathing a sigh of relief after Beijing offered a hefty penalty to Alibaba. They believe that the fine will instead give the company a temporary respite amid the regulatory uncertainty and low morale among its employees. However, that doesn’t seem to be the end of it.
The South China Morning Post
Bloomberg 9 reported concerns about whether Chinese Communist authorities will next require Alibaba to sell its media assets. Chinese regulators are said to be concerned about Alibaba’s ability to sway public discourse and want the company to sell some of its media assets, including Hong Kong’s leading English-language newspaper, the South China Morning Post.
In mid-March, the Wall Street Journal cited sources familiar with the matter as saying that Beijing authorities wanted Alibaba to sell its media assets, including the South China Morning Post.
The paper said Beijing authorities expressed concerns about Alibaba’s media business during several meetings last year, particularly its influence on Chinese social media and its role in online scandals.
Alibaba and Jack Ma personally now control media assets including online forums, news media, production companies, social media and advertising assets. Ali holds a majority stake in Weibo, as well as the South China Morning Post, Alibaba Pictures and online video platform Youku.
Beijing authorities began discussions last year to ask Ali to sell the South China Morning Post, and although no buyer has been confirmed, it is expected to be bought by a Chinese company, people familiar with the matter said.
Who is the real owner of the South China Morning Post?
Founded in 1903, the South China Morning Post was the oldest and most important English-language newspaper in Hong Kong during British colonial rule. With the relative lack of freedom elsewhere in China, the South China Morning Post has traditionally been a bastion of press freedom, with a readership of diplomats, bankers and foreigners living in Hong Kong.
In 1993, wealthy Malaysian businessman Kwok Hak Nin bought a controlling stake in the South China Morning Post from Australian media mogul Meadow for HK$2.92 billion, a 73.99 percent stake.
The Financial Times has described the Kwok He-nian family as disenchanted with the South China Morning Post business and the South China Morning Post Group as insignificant in its business empire. According to the article, “Guo He-nian’s family bought the South China Morning Post from Meadow in 1993 at the behest of Beijing at the time. ……”
After the June 4 Incident in 1989, the Western world sanctioned the Chinese Communist Party and foreign investors abandoned the Chinese market, while Guo He-nian increased his projects and investments. According to China Economic Weekly, in August of that year, Jiang Zemin, then general secretary of the CCP, invited Guo He-nian’s family to a dinner at the Diaoyutai State Guest to express his gratitude.
On Dec. 11, 2015, Alibaba Group announced an agreement with the South China Morning Post (SCMP) Group to acquire SCMP and the other media assets of the SCMP Group.
In September 2016, the Chinese website of the South China Morning Post, which had previously reported continuously on some of the Chinese Communist Party’s shady practices and infighting, suddenly ceased operations without warning, leaving only the English version.
On July 21, 2017, Dr. Cheng Xiaonong, a political and economic scholar, said in an interview on the Voice of America’s Focus on Dialogue program that although Ma was a contributor to the purchase of the South China Morning Post by the Chinese Communist Party, the right to operate and control the paper was in the hands of the Communist Party’s Hong Kong and Macau Working Committee, whose de facto controller is Zeng Qinghong.
Cheng Xiaonong said, “Jack Ma is this investor who came out of this acquisition of the South China Morning Post, but Jack Ma is not the editor-in-chief of this newspaper, he doesn’t look at the big sample, and he doesn’t care about the editorial business, he’s far away in Beijing.”
- the South China Morning Post and Xi Jinping
In recent years, the South China Morning Post seems to have paid extra attention to Xi Jinping and his cronies, which seems to be very different from the treatment of Jiang Zemin and Zeng Qinghong.
On July 19, 2017, as the 19th Communist Party Congress raged on, the South China Morning Post “published a rare article suggesting that the family of Xi Jinping’s top internal butler, Li Zhanshu, had amassed wealth”; at the juncture of the internal strife in Zhongnanhai, it pointed the finger at Xi’s right-hand man, Li Zhanshu.
The report said that the mysterious Singaporean tycoon Cai Huabo has a registered address at 6 Stanley Beach Road, a luxury residential area in Stanley, Hong Kong, and another person named Li Qianxin who lives there with him.
The report also said that, according to official documents from the Hong Kong registry, the name “Li Qianxin” is exactly the same as the name of the daughter of Li Zhanshu, director of the Communist Party’s Central Office and head of the Central State Security Commission Office.
The following day, the South China Morning Post stated that the article was published in the comment section and was not an investigative journalism report, and that it was withdrawn because of unverifiable innuendo.
On July 21, Dr. Cheng Xiaonong said on a Voice of America talk show, “The South China Morning Post is actually controlled by the Hong Kong and Macau Workers Committee… I believe that the South China Morning Post published the article under the operation of some people from the Hong Kong and Macau Working Committee, which we all know is the turf operated by Zeng Qinghong for many years, and he has all kinds of forces under the table that continue to operate, so it can be said that this is a trick under the table of the anti-Xi and anti-Wang forces.”
On October 21, 2017, Wang Xiangwei, former editor-in-chief of the South China Morning Post, published an article in the South China Morning Post a few days before the end of the 19th National Congress, naming in advance the new list of the seven Standing Committee members: Xi Jinping, Li Keqiang, Wang Yang, Wang Huning, Zhao Leji, Han Zheng and Li Zhanshu, which is not different from the list of the Politburo Standing Committee announced only a few days later after the announcement of the 1st Plenary Session of the 19th Central Committee. To the surprise of the outside world.
On Dec. 2, 2017, Wang Xiangwei again published an op-ed in the South China Morning Post, saying that Wang Qishan, the No. 2 figure in the CCP, although he retired to the second line at the 19th CPC National Congress held in October, he actually still influences the operation of the top level of CCP decision-making. Wang Xiangwei also made a prediction that Wang Qishan would become vice president of the country in March 2018. Sure enough, on March 17, 2018, Wang Qishan, 69, was elected vice president of the country, replacing Li Yuanchao, 67, and was then officially sworn in.
Photo: Wang Xiangwei
On December 5, 2017, the South China Morning Post published a commentary titled “Xi Jinping did not make history, history made him,” accompanied by a cartoon showing Xi Jinping smugly atop a raised dragon’s tail.
On March 24, 2018, the South China Morning Post published an article by former editor-in-chief Wang Xiangwei titled “Worries Deepen Over Xi Jinping’s Cult of the Individual; China Should Weaken Official Media Propaganda,” which said that the Chinese Communist Party’s military began to compile and print “Quotations from President Xi,” which originally resembled Mao Zedong’s “Quotations from Chairman Mao” during the Cultural Revolution, and which criticized Xi for engaging in a cult of the individual.
Wang Xiangwei worked for China Daily, the English-language version of the Communist Party’s grand foreign propaganda, before becoming editor-in-chief of the South China Morning Post, and was a member of the Jilin Provincial Committee of the Chinese People’s Political Consultative Conference and a current member of the National Committee of the Chinese People’s Political Consultative Conference. Reportedly, has a Jiang system background.
Becker, the Beijing bureau chief of the South China Morning Post, said in 2012 that Wang Xiangwei often contacted officials of the Central Government of the Communist Party of China in Hong Kong to seek their advice on morning newspaper coverage.
Ant Group
- Multiple departments of the Chinese Communist Party interviewed Ant Group
Photo: Central Bank Vice Governor Pan Gongsheng
On April 12, the Communist Party of China’s Banking and Insurance Regulatory Commission, the central bank and other financial authorities jointly interviewed Ant Group again, putting forward a number of rectification requirements, including transforming the group into a financial holding company, divesting its financial products “debit” and “chant” from Alipay and integrating them into a consumer finance company. The group was divested from Alipay and incorporated into a consumer finance company so that it could be regulated accordingly.
The central bank, the banking and insurance regulator, the securities regulator, the foreign exchange bureau and other financial authorities jointly interviewed Ant Group again on Monday. At a press conference on the same day, Central Bank Vice Governor Pan Gongsheng said the interview was mainly about the “serious problems” in Ant Group’s financial business activities and the “seriousness” of rectifying them. The regulator has proposed five key directions for Ant Group’s rectification.
- The powerful coterie behind Ant Group
In a February 15 report, the Wall Street Journal quoted sources as saying that Chinese Communist Party officials halted Ant Group’s IPO last year “because of concerns about financial system risks and anger over Ma’s critical comments. behind layers of opaque investment vehicles is a coterie of widely connected powerful Chinese (Communist) state figures, some of whom have ties to political families that pose a potential challenge to Xi Jinping.”
According to the report, the authorities’ investigation into Ant Group’s shareholding structure found that Boyu Capital, founded by Jiang Zemin, the grandson of former Communist Party leader Jiang Zemin, holds a roundabout stake in Ant through a private equity fund, Beijing Capital Management; Li Botan, the son-in-law of former Politburo Standing Committee member Jia Qinglin, also holds a stake in Ant through Beijing Zhaodu Investment, which he controls. The report said that Ma’s close friend, Li Botan, also holds a stake in Ant through Beijing Zhaodu Investment. The report said Ma’s close friends also hold Ant Group in different investment vehicles, including Fosun Group Chairman Guo Guangchang, Giant Network Chairman Shi Yuzhu and China Pan Ocean Holdings Group Chairman and President Lu Zhiqiang.
The report mentions that Jiang, a Harvard graduate, has known Ma for a long time and helped him negotiate with Yahoo in 2012, helping him buy back half of Yahoo’s stake in Alibaba for $7.1 billion with his own Boyu Capital, together with China Investment Corporation, China Development Bank and CITIC Group. These companies have strong political connections, and in return, the consortium received nearly 5 percent of Alibaba’s equity, which led to a huge profit when Alibaba went public in the U.S. two years later.
Xi Jinping’s plan for the 20th National Congress to suppress the Jiang system
According to an analysis by Nikkei, it also seems to be the result of the internal political struggle of the Chinese Communist Party, which will replace its staff at the 20th National Congress in 2022.
The Nikkei quoted sources as saying Xi Jinping was furious when he saw the secret list of people with interests behind Ant Financial Services.
There is speculation that Xi is determined to continue his re-election after the 20th National Congress and that punishing Alibaba is his way of undermining the influence of the political figures behind the company.
In February, the Wall Street Journal cited sources familiar with the matter as saying that Jiang Zemin’s family’s Boyu Capital was moving to Singapore starting in 2019.
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