Chinese Vice-Premier Liu He has backed a rare public push for the platform economy and backed the listing of several companies on domestic and foreign capital markets, a sign that Beijing may be ready to give tech giants a shot in the face of a slowing domestic economy.
The National Committee of the Chinese People’s Political Consultative Conference held a special consultation meeting on “Promoting the Sustainable and Healthy Development of the Digital Economy” in Beijing on Tuesday (17th). Liu He attended the meeting. Baidu (START US) Founder Robin Li, NetEase (DETECTOR-US) founder Ding Lei and other big names also attended the meeting. Liu He said that entrepreneurs are the most important innovation entities. We must support the sustainable and healthy development of the platform economy and the private economy, properly handle the relationship between the government and the market, and support the listing of digital companies in domestic and foreign capital markets.
State media reported few details on Liu He’s speech, but the move highlighted Baidu, Tencent (00700-HK), the regulatory risks faced by tech giants such as .NasdaqChina’s Golden Dragon Index closed up 5.2% on Tuesday, with component Alibaba (BABA-US) , Pinduoduo (PDD-US) shares rose more than 6%, and Baidu also reached 4.79%.
Maintaining stability is a top priority for Beijing at a time when geopolitical uncertainty and the impact of the COVID-19 pandemic hit the Chinese economy. More sensitively, the CCP will hold its “20th National Congress” at the end of this year, and it is expected that Xi Jinping, the general secretary of the CCP, will be re-elected at that time.
Beijing hopes that the technology industry, the biggest growth engine of the past decade, can revive the economy as the epidemic prevention and control restrictions affect consumption and block supply chains. China’s economic activity shrank sharply last month, with retail sales plummeting 11.1%, the second straight monthly decline and the biggest drop since March 2020, and economists say there is still no hope of a recovery.
