Beijing is particularly concerned about the growing weight of private giants, to the detriment of traditional banks.
ina will tighten regulation of technology companies to fight more effectively against monopolistic practices and financial flows that pose a risk to the financial system, Prime Minister Li Keqiang announced on Friday.
Efforts [to fight] against monopoly situations and unregulated capital flows will be intensified “in order to ensure healthy competition, Li said at the opening of the annual plenary session of the Chinese parliament.
In late 2020, the communist government halted the IPO of online payment giant Ant Group, founded by Jack Ma, a pioneer of e-commerce in China with his Alibaba group.
The aborted trade should have been the greatest introduction to the stock market of all time. Alibaba and its rival Tencent (with the WeChat Pay service) are the two private giants that share the immense electronic payment market in China, a sector so far little regulated in a country where cash has almost disappeared.
Beijing is particularly concerned about the growing weight of private giants, to the detriment of traditional banks whose loans pose a risk to the country’s financial system.
In recent months, the Chinese government had already begun to tighten its grip on digital giants. In December, Alibaba was placed under investigation for “suspicious monopoly practices.”
Regulators also tightened rules on online microcredit, popular with Chinese and small businesses that have difficulty obtaining loans from traditional banks. The digital economy has had a strong development in recent years, thanks to the generalization of electronic payments and the multiplication of online services available to smartphones.