Financial regulation: China holds back its tech titans
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Financial regulation: China holds back its tech titans

China’s crackdown on its biggest technology companies shows the difficulty of balancing growth at all costs at the leading fintech firms with support for state-owned banks.

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Illustration: Sam Hadley

Jack Ma could be excused for feeling a tad under-appreciated in Beijing’s political circles.

Just 12 months ago, the global face of Chinese innovation was the toast of the town. Alibaba Group Holding, co-founded by Ma, was expanding into e-commerce markets everywhere, Amazon-style. Even better, its affiliate company Ant Group, a leader in financial technology, was about to pull off history’s biggest initial public offering. And unlike in 2014, when Ma took Alibaba public in New York, Ant’s huge $35 billion listing was set for Shanghai and Hong Kong, leaving Wall Street seething with envy.

Ever since it all came crashing down at the 11th hour last November, China has seen a bull market in theories as to why. The most viral: that Ma’s infamous October 24 speech in Shanghai, when he called China’s big state banking “pawnshops” and said that regulators don’t understand technology, led to Ant’s comeuppance.

Yet in the months since, the plot thickened considerably. Ma, it turned out, was merely the first victim of a tech crackdown driven by president Xi Jinping and his Chinese Communist Party (CCP).

The country’s regulators have since trotted out a plethora of policies to rein in China’s most powerful internet companies and their billionaire, Davos-going founders, in most cases for alleged monopolistic behaviour.


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