Read more about Xi cracks the whip on everything to strengthen party grip on China on Business Standard. And right now they revolve around the convergence of technology, finance and Hong Kong
The past few weeks have shown that Chinese President can move extremely fast when he hones in on long-term threats to the Communist Party. And right now they revolve around the convergence of technology, finance and Hong Kong. Since unveiling a goal last month to double the size of the economy by 2035, has embarked on a sweeping crackdown of some of its most valuable companies. The shock suspension of Co.’s $35 billion initial public offering was quickly followed by more anti-monopoly rules to rein in former tech darlings Tencent Holdings Ltd. and Alibaba Group Holding Ltd., leading to a $290 billion equity sell off last week. At the same time, he’s moved to further snuff out any opposition in Hong Kong’s legislature, the most democratic institution under Chinese rule. And authorities are forcing bond investors to take more responsibility for risk in a debt market where defaults have been historically rare, helping to deflate a potential debt bubble while also avoiding an inadvertent funding crunch. The moves reflect an increased urgency among China’s top leaders to stem growing threats to their rule, whether it be a 2008-style financial crisis, a color revolution or a new class of billionaires becoming more powerful by the day. And while some of the measures are prudent steps to de-risk the economy, one common thread runs through them all: The need for the Communist Party to control all the levers of power. suffers shock suspension of its $35 billion IPO after chairman criticised China’s financial regulators. (Photo: Bloomberg) “ certainly seems to be cracking the whip with a purpose and a force that, if not new, is certainly designed to impress upon the party, entrepreneurs, citizens and the rest of the world his authority and determination,” said George Magnus, research associate at Oxford University’s Centre. “I don’t see much that is pre-emptive or getting ahead the curve here. If there were, Xi would be channeling his inner ‘reform and opening up’ appetite. The point is that he doesn’t really have any.” Last month’s unveiling of the Communist Party’s latest five-year plan came at a crucial time. The West began to see China’s rise more as a threat than an opportunity over the past four years, and President Donald Trump took a series of steps to cut the country off from key technologies to thwart its growing economic and military might.
