The Wall Street Journal has reported that Jack Ma, the founder of Ant Group, has told regulators that he is willing to hand over part of his stake in Ant Group to the state in a bid to survive, after he realized he had angered Xi Jinping with his remarks. But the Chinese government refused to accept Ma’s olive branch and initiated tougher control measures. The recent Central Economic Conference targeted the platform economy again in the name of anti-raiding.
The Wall Street Journal, which first revealed that Xi had blocked Ant Group’s plans to go public, reported Sunday (Dec. 20) that Jack Ma, a Chinese billionaire caught in the crossfire, has tried to salvage his relationship with Beijing by proposing to hand over part of his stake in the fintech giant Ant Group Co. to Beijing, according to people familiar with the matter.
Sources close to the matter said Ma was interviewed by officials from China’s securities and banking regulators on Nov. 2 this year, just days before Ant Group’s planned IPO date, when he said he could take away Ant’s platform for as long as the country needed it.
French commentator Wang Longmeng told the station that Ma’s comments have been perceived as angering Xi Jinping and causing retaliation, but it should be analyzed in the context of the overall situation, which is the CCP’s overall policy to harvest powerful private enterprises.
Wang Longmeng said: While Ma’s statement is to break his arm to survive, his admission of weakness cannot guarantee peace. The CCP wants not only some of the benefits Ma promised, but all of them.
Wang Longmeng also pointed out that the CCP’s Central Economic Conference is a strong signal that Tencent, which owns WeChat Pay, and Baidu, which owns “Du Xiaoman Pay,” will suffer the same dilemma as Ant Group. Despite Ma’s earlier political statement of publicly supporting Deng Xiaoping’s suppression of June 4, and Baidu and WeChat both helping the government do speech censorship, these “political amulets” will not escape the government’s fate of “nationalizing” their enterprises.
Wang Longmeng said: Although Ma Yun used to openly support Deng Xiaoping’s suppression of June 4, Ma Huateng and Li Yanhong officially did speech censorship, but this political amulet can’t save them.
The olive branch thrown by Jack Ma did not receive a positive response from the authorities. People close to China’s financial regulators told the Wall Street Journal that they are currently unable to accept Ma’s offer to hand over part of Anthem’s business to the government and are instead considering a plan to impose stricter capital and leverage regulations on Anthem. In that case, a state-owned bank or other type of state-owned investor would acquire Anthem to cover any potential capital shortfall due to the tightened regulations.
Martin Chorzempa, a research fellow at the Peterson Institute for International Economics, was quoted in the Wall Street Journal as commenting that the Chinese government has effectively nationalized certain financial infrastructure platforms built by the Ant Group, and nationalizing that platform is seen as having a key policy purpose.
Wuer Kaixi, a former leader of the 1989 academic movement and executive deputy secretary general of the Association for the Promotion of Human Rights in Taiwan‘s Legislative Yuan, noted that Chinese companies such as Jack Ma are licking their chops for profit, and that their ready harvesting by the Chinese Communist Party is a warning to the West that China’s economy is firmly tied to power and is a disruptor of the international order.
Wuer Kaixi said: Jack Ma and the others are licking blood on the knife’s edge to make money, so it is also impossible to expect them to have moral and personal autonomy. But the problem is that you get to the end, it this knife bend, with political intervention to deprive them of all time. There may be some people who feel that they should be submissive in dealing with the Beijing authorities, with Xi Jinping. These richest people in China should realize, and the world should also see clearly: it is not possible to steal a life by enduring humiliation, and it is impossible for the Chinese Communist Party to accept a regime like the international order.
The Wall Street Journal reported earlier that Ma had previously angered top Chinese Communist Party leaders at an event when he took aim at Xi Jinping’s signature campaign to control financial risk. After Ant Group’s more than $34 billion initial public offering was called off, the Chinese government then launched a flurry of actions against what has been dubbed the ‘platform economy’.
On Dec. 16, 2015, Xi Jinping visited the “Light of the Internet” expo in Wuzhen and stopped by Alibaba’s booth, where Ma Yun personally acted as an interpreter to introduce Ali’s e-commerce development to Xi Jinping. Unexpectedly years later Xi Jinping personally ordered to call off Alibaba’s Ant Group’s plan to go public. (Internet Conference official website)
On the morning of the 20th of this month, at the China Wealth Management 50 Forum in Shenzhen, Lou Jiwei, director of the Foreign Affairs Committee of the Chinese People’s Political Consultative Conference and former Minister of Finance, pointed out that it is necessary to prevent data financial platforms from becoming too big to fail and prevent winner-takes-all.
Xi Jinping’s government has in recent years imposed heavy laws to purge private enterprises that are seen as “undisciplined,” with property tycoon Wang Jianlin’s Dalian Wanda Group forced to sell assets and shrink its business; Wu Xiaohui, the founder of another private enterprise, Anbang Insurance Group, was sentenced to 18 years in prison in 2018, and Anbang has been taken over by the state.
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