/ world today news/ One of China’s richest and most powerful businessmen, founder of online retail giant Alibaba, Jack Ma, made his first public appearance this week after nearly three months of absence. He disappeared from the eyes of journalists after criticizing the authorities. Such a long period is a record for the PRC, and the very practice of missing Chinese billionaires has already become a pattern and does not always end without consequences.
One of China’s richest men, Jack Ma (Ma Yun), has appeared in public for the first time in months. On January 20, he spoke via video link at an online event to support Chinese rural teachers. A recording of the businessman’s speech was posted on his Twitter page by a journalist from China’s state-run Global Times newspaper.
Jack Ma was last seen in public on October 24. Then, at a financial forum in Shanghai, he criticized the Chinese government, which he said was stifling innovation in the financial industry.
After that, Ma disappeared. Alibaba’s Ant Group, which owns the payment service Ali Pay and has about 50% market share in China, has faced problems. Ant Group was due to go public in Hong Kong and Shanghai in early November. It was expected to become the largest IPO in history: the company is expected to raise up to $34.4 billion. Just two days before the listing, it became known that Chinese regulators had halted the process “due to significant issues.”
According to the Wall Street Journal, the president of the People’s Republic of China, Xi Jinping, personally ordered the operation to be halted as the country’s authorities “went into a frenzy” after the businessman’s October speech. In addition, according to the newspaper, Jack Ma even proposed to the authorities to nationalize some of the Ant Group’s assets, but in the end this did not help prevent the cancellation of the PPP.
After blocking the initial public offering of Ant Group, official Beijing recommended Jack Ma not to leave the country, Bloomberg reported, citing its sources. Later, information emerged about the initiation of an antitrust investigation against Alibaba by the China Market Regulatory Authority.
In early January, CNBC anchor David Faber said the Chinese businessman had not disappeared, but simply “hit rock bottom.” “It appears to be in Hangzhou, where Alibaba is headquartered. He is no longer involved in the management of the company. He purposefully became less visible,” Faber said.
Be that as it may, after the appearance of this news, “Alibaba” suffered quite serious losses – after the disappearance of Jack Ma, the company’s shares fell by 30%, stressed the political scientist and sinologist Nikolai Vavilov. After the businessman returned to the media space, foreign media, the company’s securities rose by 9% on the Hong Kong Stock Exchange.
However, Vavilov admits that a 30% drop is not the worst-case scenario. The sinologist admitted that all the time since his disappearance, Jack Ma may have been involved in some sort of backroom negotiations with the Chinese authorities, that his financial empire was on the brink: if the authorities had announced an arrest, the stock could have collapsed even more.
According to the expert, this event shows that the Chinese authorities are ready to follow a fairly strict new line in dealing with large corporate private enterprises.
Nikolay Vavilov emphasized that the case of Jack Ma is extremely unusual. “First, he disappeared for almost three months, he did not participate in any events for a long time. This is uncharacteristic of him. Second, he disappeared immediately after his scathing remarks at the Shanghai forum. He openly criticized China’s financial system, which is unusual for the Chinese. He came to a very sharp confrontation with the state system of the PRC. For the last 20 years, this is something absolutely unusual,” said the expert.
At the same time, the director of the Far East Institute of the Russian Academy of Sciences, Alexey Alexandrovich Maslov, believes that Jack Ma’s words do not contain criticism of the authorities. According to the expert, the businessman, in a manner quite typical for this format of the event, proposed several constructive proposals, which are probably contrary to the established banking practice. “But he has not touched the foundations of power,” Alexander Maslov pointed out.
He also noted that the disappearance of such influential people in China is most often associated with the fact that they are under house arrest while the investigation is ongoing. As the expert explained, if in Russia it is possible to learn about the arrest of a person from the media already on the same day, in China, on the contrary, it is not announced immediately, because there is a very thorough check of what is worth reporting.
In the case of Jack Ma, according to him, there was an attempt not to spoil his image and “calmly work on the situation.”
As the expert explained, this is a serious blow to the businessman himself and to Alibaba in general. Nevertheless, the fact that Ma appeared publicly, according to Alexander Maslov, suggests that the situation is improving. He expressed doubt that anything could happen to the businessman himself or to Alibaba as a global giant.
Nikolay Vavilov, for his part, recalled that Jack Ma had a conflict with the authorities for a long time, and this was even before Xi Jinping came to power. According to him, the authorities decided to oppose “Alibaba” and specifically created the corporation JD.com as a rival of this company. As for Alibaba itself, it, as well as Ant Group, according to the expert’s assumption, will be demonopolized, since we are talking about monopolists in the field of online trade. As Nikolay Vavilov predicted, subsequently, against the background of current events, JD.com may gain a competitive advantage in covering the whole of China in terms of online commerce.
“Since Jack Ma has appeared in public, most likely no investigative actions against him should be expected. Perhaps he will decide on his own to be in a jurisdiction other than the PRC,” the source admitted.
Jack Ma’s case is not unique. Both experts admit that the practice of disappearing influential people for a certain period in China does exist. In mid-March, there was information about the disappearance of a well-known businessman who previously headed the state-owned entrepreneur Hunan Real Estate, Len Jiqian. But in his case, everything was much more serious compared to Jack Ma’s situation: Len not only criticized the government for its actions in the coronavirus pandemic and attempts to hide its scale, but also called Xi Jinping a clown.
After the Chinese chairman addressed members of the Chinese Communist Party via video link on February 23, Len wrote that he saw “not an emperor in his new clothes, but a naked clown posing as an emperor.” Later, “Reuters” reported the businessman’s disappearance, citing his friends.
In late September, Len Jiqian was sentenced to 18 years on corruption charges. He was found guilty of embezzlement, bribery and other economic crimes amounting to at least 131 million yuan (about $19 million).
As one of the most high-profile cases for China with the disappearance of influential people. Nikolay Vavilov pointed to the case of Guo Guangchan, the head of “Fosun” who disappeared in 2015. Unlike Jack Ma, Guo literally disappeared for only a few days: rumors of his disappearance appeared on December 10, and on December 14, he took part in the company’s annual meeting. Guo Guangchan is one of China’s richest men, and Fosun is one of the country’s largest private conglomerates, holding assets in various sectors of the economy, including insurance, real estate, pharmaceuticals and resorts.
As the BBC reported at the time, citing Fosun representatives, Guo was detained by police and began cooperating with the investigation. At the same time, the company specified that he himself was not under investigation.
Translation: V. Sergeev
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