Jack Ma, the most famous businessman China has ever produced, is stepping away from the limelight. His friends said that he was drawing and practicing tai chi. Sometimes, he shares drawings with Masayoshi Son, the billionaire head of Japan’s SoftBank conglomerate.
The world at large caught a glimpse of Mr. Ma for the first time in months last week, during a virtual board meeting of the Russian Geographic Association. When President Vladimir V. Putin and others discussed arctic issues and cheetah conservation, Mr. Ma could be seen leaning his head on the side, looking bored.
For Mr. Ma, the first charismatic businessman, showed how China would shake the world two decades ago in the internet age; has a makeover face for admiring business bookshelves; the man who has never met a crowd that he cannot dazzle – it is a marked change of pace.
Under the top leadership of the Communist Party of Xi Jinping, China has punished and defamed a series of tycoons, who have amassed enormous wealth and influence but are believed to have exceeded the limit. their. Mr. Ma and the gems of his online empire, e-retail giant Alibaba and fintech giant Ant Group, are Beijing’s biggest targets, as officials begin to make adjustments. The country’s mighty internet industry like never before.
American and European officials have been trying to curb the Internet giants for years. But it’s hard to imagine Western regulators delivering such a dramatic change in fortunes as the incident happened to Mr. Ma. Xi asserted broad control over China’s private sector, demanded party commitment and social stability over profits.
Xiao Jianhua, once the trusted finance lieutenant of many Chinese elites, was caught off a luxury hotel in Hong Kong in 2017. Ye Jianming, an oil tycoon looking for a relationship in Washington, was detained, as did Wu Xiaohui, whose insurance company bought the Waldorf Hotel Astoria in Manhattan. Mr. Wu was then sent to prison. Lai Xiaomin, a former chairman of a finance company, was executed this year.
Richard McGregor, a senior fellow at the Lowy Institute and author of the book “The Party: The Secret World of Chinese Communist Rulers,” said: “The general rule is that there is no center of power. individually outside the party. “
Beijing’s restraint on technology is pervasive in meeting rooms outside of Alibaba.
Ant Group CEO Simon Hu resigned in March. A few days later, Colin Huang resigned as chairman of Pinduoduo, a mobile marketplace he founded and went public within a few short years. Pinduoduo announced his resignation on the same day, saying it had attracted 788 million shoppers in the past 12 months – a bigger number than Alibaba.
At a political meeting that month, Pony Ma, the founder of social media giant Tencent, proposed tougher rules for internet companies – or as an official newspaper said. It is “innovative methods of regulation and governance”.
Last week, China’s antitrust agency summoned top 34 internet companies to talk about new rules of fair competition. Over the course of a few hours, they discussed the changes in business and publicly pledged to stay in the position.
“These new rules will require internet platforms to consider how they innovate in the future,” said Gordon Orr, a non-executive board member at Meituan, the Chinese food delivery giant. as a result, less innovation is likely ”.
Even so, Alibaba and other internet giants with status in China can protect them from the harshest treatment. Officials have praised the giants’ economic contributions even as they tighten scrutiny. Xi wants the Chinese economy to be driven by its own innovations rather than by the fickle innovations of foreign powers.
That means it may be too early to tell Jack Ma to give up the count.
“His company is more important to the success and performance of the Chinese economy than any other company,” said McGregor. “The government wants to continue reaping the benefits of his company – but on their terms. The government did not nationalize Alibaba. It does not confiscate its property. It simply narrows the field in which it operates.
Alibaba declined to comment.
Mr. Ma has no reason to deal with the authorities in China.
He worked briefly and unhappily at a government-run advertising agency before founding Alibaba in 1999. At the time, China was still getting used to the idea of private entrepreneurs. Human power is powerful, and Mr. Ma is adept at seducing government officials.
“Alibaba has a perfect chance of growing into a world-class company,” said Wang Guoping, secretary of the Communist Party of Hangzhou City, where Alibaba was headquartered in the 2000s. “What a world-class company needs most is a soul, a leader, a world-class businessman. I believe that Jack Ma meets this standard.
Porter Erisman, an early Alibaba chief executive, said Ma soon realized the success it could bring in China.
“There is only one person in the company that makes us notice that one day we might face such big problems that we will be under pressure because there is too much visual power,” Erisman said. school. “And that’s Jack.”
Mr. Ma voiced his concerns at a staff meeting in the mid-2000s, Erisman said. At the time, he added, most of the Alibaba employees were “just trying to think, ‘How do we make money?'”
In 2011, Ma learned of how his ambitions could mislead shareholders and regulators. He quietly took over Alibaba’s payment service, Alipay, angered one of Alibaba’s biggest investors, Yahoo. Ma said the move is necessary under the new Chinese rules. Alipay later became Ant Group.
“The Alipay transfer has encouraged him,” said Duncan Clark, who has known Mr. Ma since 1999 and is the chairman of BDA China, a consulting firm. “He got rid of it.”
As Alibaba grew, Ma began to be held by presidents and movie stars, but also by a growing number of Chinese businessmen. This “echo chamber” may have distorted Mr. Ma’s idea of himself and his views with the government, Clark said.
If not, he may have seen the writing on the wall, especially since Xi has pushed private businesses to cooperate more closely with the state.
When Mr. Ma resigned as Chairman of Alibaba in 2019, an article in the official Communist Party newspaper stated: “There is no such thing as the Jack Ma era – only Jack Ma is part of the era. this “.
Chinese leaders need the private sector to help sustain economic growth. But they also don’t want entrepreneurs to undermine the party’s dominance across society.
Last October, when Ant was preparing to go public, Mr. Ma spoke at a conference in Shanghai and criticized China’s financial regulators. He has long viewed Ant as a means of disrupting the country’s major state-owned banks. But there is rarely a time when there is less chance to score. Officials halted the listing of Ant shares shortly thereafter.
Kellee S. Tsai, a political scientist at the Hong Kong University of Science and Technology, in China, “it’s hard to say that the emperor doesn’t have clothes today.
Mr. Ma has also disappeared from view in his companies. In January, he appeared in an internal chat group to answer a business question, according to one person who viewed the message but was not allowed to speak publicly. The staff then shared Mr. Ma’s messages to reassure anxious colleagues.
Recently, the Hurun Report team in Shanghai estimated that Mr. Ma for the first time was not one of the three richest people in China. The country’s new No. 1 spot is Zhong Shanshan, the low-end head of both a bottled water and pharmaceutical conglomerate.
When his water supply company was listed last year, Zhong was so little known that Chinese news reports about his unexpected wealth had to explain to readers how to pronounce confusing Chinese characters. in his name.