Consolidating the party-state’s control over business

Why read this story?

Editor's note: The most defining moment in Chinese business-state relations in recent memory was the public disappearance of Jack Ma, the billionaire founder of Alibaba, right before his fintech company, Ant Group, was poised for a massive public listing.  In late October 2020, Ant Group was valued at over $300 billion, larger than many of the largest banks in both China and the US. Its IPO, which was supposed to happen jointly between Shanghai and Hong Kong, could have been the largest in recent financial history. But then Ma vanished. In the days leading up to his disappearance (on 24 October, to be precise), Ma had been publicly critical of China’s financial regulators and their conservatism regarding collateral requirements for lending, particularly through fintech platforms. He had criticized their “pawnshop mentality,” asserting that new actors in the country’s financial sector (including Ant Group’s Alipay platform) needed to be bolder in extending credit to the collateral-poor, since the country’s conservative large financial actors are often reluctant to offer credit to innovative small companies and individuals. Clearly the public criticism was a step too …