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Xi Jinping
TechPolicy

Xi Jinping says Big Tech crackdown is making progress, calls for Communist Party to ‘guide’ companies

  • Xi says antitrust campaign against internet platforms has seen early results and called for the Party to do more to supervise businesses
  • Beijing’s crackdown has led to a market rout this year that has wiped US$1 trillion off Chinese tech stocks

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Chinese President Xi Jinping, pictured here on July 1, said in a meeting on Monday that the government’s campaign against tech giants to address “barbarous growth” has shown early results. Photo: Xinhua
Xinmei Shen

Beijing’s campaign to “prevent the irrational expansion of capital” and address “barbarous growth” in China’s technology sector is beginning to bear fruit in the wake of an accelerated antitrust campaign targeting internet platforms, Chinese President Xi Jinping said at a central leadership meeting on Monday afternoon.

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Fair competition is necessary to improve the social market economy and promote “common prosperity”, Xi said in comments reported by state-owned Xinhua News Agency, using a government buzzword that represents China’s push for more wealth creation, as Beijing’s recent moves to rein in Big Tech continue.

Xi also warned that the Communist Party must do more to “guide and supervise” the country’s businesses with clear rules, effective regulations and greater policy transparency.

Chinese regulators have been involved in near-continuous campaigns targeting the country’s tech giants since last winter, when Xi first tasked government bodies with curbing the “disorderly expansion of capital” at a central economic planning meeting. It was listed as one of the government’s eight most important economic tasks for 2021, along with strengthening technological innovation, boosting domestic demand and pursuing carbon neutrality.

According to the meeting notes released last December, “preventing the disorderly expansion of capital” involves better regulations and standards for identifying monopolistic companies, governing the collection and use of data, and protecting consumer rights.

A wide range of government bodies have since taken to drafting new regulations and initiating campaigns designed to clip the wings of Big Tech. These include revoking approval for fintech giant Ant Group to go public, an antitrust fine against e-commerce giant Alibaba Group Holding – the owner of the South China Morning Post – forcing Tencent Holdings’ music arm to relinquish exclusive licensing deals, a cybersecurity probe into ride-hailing giant Didi Chuxing, and effectively signing a death warrant for the entire private tutoring industry.
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The barrage of bad news for tech companies this year has wiped more than US$1 trillion off Chinese tech stocks, leaving rattled investors trying to guess what regulators might do next.
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