fredag 10. september 2021

The Real Cause of China’s Alibaba Crackdown

On August 23, the Central Commission for Discipline Inspection announced an anti-corruption investigation targeting Zhou Jiangyong, the party secretary of Hangzhou. Hangzhou is the city where the famous tech monolith Alibaba and its subsidiary Ant Group are headquartered, and Zhou’s fall is reportedly associated with scandals of his family members covertly holding a great amount of Ant Group’s shares.

The news certainly deals another blow to Alibaba’s already precarious position. Since the $37 billion IPO of Ant Group, predicted to be the largest IPO in the world if successful, was abruptly suspended by regulators last November, Alibaba and its founder Jack Ma have been continuously under enormous political pressure. Some observers attribute Alibaba’s current predicament to Ma’s defiant attacks on the financial regulators of China before the IPO. Others describe Alibaba’s experience more generally as an example of the crackdown on the private sector by the Chinese Communist Party, which is increasingly reasserting control over the economy.