The yr China went rogue on itself: Will crackdowns hamper financial progress?, World Information
From entertainment to technology, there is hardly a sector in which Chinese President Xi Jinping did not crack down in 2021.
As a result of the strict regulations imposed by the Chinese Communist Party in the name of “common prosperity”, the country’s companies are dropped from the list of the top 10 most valuable companies.
Chinese markets lost $ 1.5 trillion in a massive setback and the country’s largest real estate company, Evergrande, is on the brink of bankruptcy.
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Where did China go wrong?
Experts had predicted that the Chinese economy will take off and reach unprecedented heights after the 2008 financial crisis that rocked stock markets around the world.
However, Jinping, who became president of the country in 2013, claimed Chinese corporations were a threat to Communist Party’s dominance and cut their wings.
The authoritarian leader’s obsession with controlling everything is hindering the country’s growth.
His crackdown on Alibaba and Tencent resulted in them being removed from the list of the world’s most valuable companies. It also bleeds Chinese stocks. The land becomes a graveyard for unicorn companies.
The volatility led to a massive sell-off, with investors fleeing and companies unable to repay their debts.
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From regulation to a campaign of revenge
Regulation in each country keeps corruption and other illegal activities at bay and ensures that customer interests are safeguarded.
However, it seems that it has turned into revenge in China. Tech companies find it impossible to work in a hostile environment.
From 2018 to 2021, 38 percent of apps on the Chinese market disappeared without a trace.
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Market leader Didi Chuxing’s ride-hailing app was banned from Chinese app stores in early July, just days after it raised $ 4.4 billion in an IPO in New York.
The company had continued its debut despite opposition from Chinese authorities who feared listing it could bring Didi’s user data into foreign hands.
When Xi became concerned about Jack Ma’s growing popularity and meeting former US President Donald Trump, he fined his company $ 2.8 billion.
Billionaire Ma is the founder of e-commerce giant Alibaba and openly criticized the country’s regulatory system in October.
However, Xi blamed the company’s monopoly and anti-competitive practices and the abandonment of social responsibility for the crackdown.
An Internet celebrity Viya, known in China as “the queen of live streaming” was recently fined US $ 210 million.
Her real name is Huang Wei, and she has more than 100 million followers but has been charged with tax evasion.
These fines are not just fines, but clear political signals from the regime.
China faced global criticism when the country’s tennis star, Peng Shuai, accused former Chinese Vice Prime Minister Zhang Gaoli of sexually assaulting her on a social media post that was later deleted.
She later said that her post was misunderstood. However, the Women’s Tennis Association expressed concern about her “wellbeing and ability to communicate without censorship or coercion”.
China has also tightened its oversight of education, video games and cryptocurrencies.
According to a new rule, children are only allowed to play video games for three hours a week because they are extremely violent.
Private tutors in China are prohibited from teaching online and are not allowed to teach in subjects that are part of the school curriculum.
It examines online platforms and social networks and claims that the internet is being “cleaned up”.
Beijing has also pushed miners and traders in Bitcoin and other digital currencies out of its market, arresting more than 1,000 people for cryptocurrency money laundering in June.