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China technology

Chinese internet leaders Jack Ma and Pony Ma call for ‘core technology’ ownership after US ban on ZTE

PUBLISHED : Monday, 23 April, 2018, 11:14am
UPDATED : Tuesday, 24 April, 2018, 6:00pm

Chinese internet giants Alibaba and Tencent are calling for the country’s enterprises to own “core technology” amid a debate over its dependence on foreign know-how after the US government banned American firms from doing business with Chinese telecommunications equipment maker ZTE Corp.

China needs more companies to play a major role in key technology developments to solve future problems and keep the country competitive amid global competition, Jack Ma, founder and executive chairman of Alibaba Group Holdings, said on Sunday.

“It is the compelling obligation for big companies to compete in core technology,” Ma said during the first Digital China Summit in Fuzhou. “A real company is not determined by its market value or market share, but how much responsibility it takes and whether it has mastered core and key technologies.”

Ma also called for a “digital economy law” to guide the development of internet companies, saying that such regulation is needed to deal with the challenges brought on with the coming of the internet of things, which will bring with it an explosion in volume of data.

ZTE may be too big to fail, as it remains the thin end of the wedge in China’s global tech ambition

Speaking at the same event, Tencent Holdings chairman Pony Ma said it is becoming increasingly urgent for Chinese enterprises to make breakthroughs in the ownership of core technology. 

The two technology chieftains’ comments add to public calls for technology independence after Shenzhen-based ZTE was slapped with a seven year ban on importing from US suppliers after it lied to the US government about disciplinary action taken against employees responsible for flouting US sanctions against Iran. The ban could send ZTE into a “state of shock” that would reverberate and hurt the interests of employees, telecom operators, consumers and shareholders, ZTE’s non-executive chairman Yin Yimin said on Friday.

The Shenzhen company will have an opportunity to give additional evidence to US authorities in hopes of a reversal of the decision, the Wall Street Journal reported. ZTE did not immediately respond to a request for comment on Monday.

Core technology is an important tool for the nation, Chinese President Xi Jinping said during a national conference on network security and information on Saturday. “We must keep persevering, focus on the key points, and accelerate core technology breakthrough in the information field,” Xi said.

At the Fuzhou event Alibaba’s Ma said China has to “stand up” in digital technology.

“Today’s world is already facing the challenges brought on by a digital age, but compared to the future, it is just a drop in the ocean,” he said.

Alibaba is the parent company of South China Morning Post.