The Chinese government is trying to regain investor confidence as the business environment in the country has deteriorated significantly over the past two years, both due to the coronavirus pandemic and Beijing's aggressive policies that have put pressure on large companies and their management to suppress dissent.
Source. Bloomberg
To reverse the trend, the authorities have repeatedly invited the founder of the Alibaba group of companies, Jack Ma, who for many still remains the personification of the local business environment, to return to China.
Chinese President Xi Jinping's entourage believes that Jack Ma's return to China would help restore the Chinese economy to its former attractiveness, Bloomberg writes, citing sources close to the government and the Chinese businessman.
Jack Ma fell out of favor with the Chinese authorities after he criticized the government's excessive interference in business companies. After that, the entrepreneur has been living outside of China for a long time, with the media claiming that he moved to Japan.
Investors remember well that just a few weeks before Jack Ma's Ant Group went public, the Chinese authorities inspected the company, banned it from engaging in its key business of lending, and canceled the IPO, which was to be one of the largest in Chinese history.
The pressure on Jack Ma led to inspections of China's largest tech companies, which led to a collapse in the stock market. The shares of Tencent, JD, Alibaba, TAL Education, and even electric car companies, which are considered to be among the most popular among investors, fell by 20-70%.
Moreover, the government demanded that its tech giants invest in social programs lobbied by Beijing. The funds from these programs were to go to vulnerable segments of the population.
The agency notes that such a policy was pursued to consolidate support for Xi Jinping on the eve of the election. Now that he has been re-elected, the Chinese leader intends to focus on the economy and return a quality business climate to the country.
Sources claim that representatives of the highest echelons of power invited Jack Ma to return to China and thus positively influence the Chinese business environment. Sources close to the businessman emphasize that he intends to focus on studying agricultural technologies and has even taken a course in sustainable farming and fisheries.
Moreover, Ma has made it clear to the top management of his companies Alibaba and Ant Group that he does not intend to actively influence their work. He is quite satisfied with his current role, where he can monitor their progress remotely.
The Chinese authorities, as the agency notes, are not satisfied with this scenario, as Ma's refusal to return to the country could be perceived by the market as a negative signal.
Background. The FT reported that Jack Ma had left China because of persecution by the Chinese authorities and was living in Japan.