Leading Chinese officials are scheduled to have a conference with the country’s big tech companies in May
The meeting has renewed hopes that Beijing will end or ease its sweeping regulatory crackdown on the country’s tech sector, allowing internet platforms to have larger roles in helping prop up a struggling Chinese economy.
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The symposium has been set for sometime in May, and will likely take place after the Labor Day Holiday, which lasts from Saturday, April 30, to May 4, two sources with knowledge of the matter told the South China Morning Post (SCMP) on April 29.
In an effort to bolster a slowed economy brought about by the country’s stringent “Zero-COVID” protocols, China’s top officials are hoping the meeting will reinvigorate tech companies to work alongside the government in salvaging its financial sector.
Big players all slated to attend
Major big tech firms, including e-commerce giant Alibaba Group, social media and video gaming giant Tencent Holdings, online delivery and on-demand service platform Meituan, and TikTok owner ByteDance, are all scheduled to be in attendance.
A joint regulatory meeting is also set to take place as soon as this weekend to put all regulators on the same page regarding Beijing’s new decision to ease its aggressive control over the tech sector, one of the sources told SCMP. The source added that Chinese leader Xi Jinping is expected to attend and chair the meeting.
The move comes as Chinese authorities face an uphill battle in warding off an economic slowdown after multiple coronavirus lockdowns across China’s largest cities have severely disrupted supply chains and shuttered many businesses.
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Politburo acknowledges slowed economy
The meeting comes following the Chinese regime’s Politburo quarterly economic meeting held on Friday, April 29. The Politburo is the top-ruling body of the Chinese Communist Party (CCP) and saw its 25-member panel vow to speed up the implementation of existing tax-cut and supportive policies, as well as the introduction of new monetary policy tools to enhance investments.
According to a statement released after the meeting, new regulatory policies for several industries were also revealed, and the country’s tech giants are hoping they will be greeted with good news ahead of next month’s meeting.
“The pandemic has to be contained, the economy should be stabilized, and the development should ensure security,” the statement said, highlighting the complex situation plaguing China’s economy as “changes unseen for a century.”
“We must insist on the policies of preventing both inbound infections and a domestic rebound of cases, and [adhere to] dynamic Zero-Covid, doing our best to protect people’s lives and minimize its impact on the national economy and society.”
“Pandemic controls and economic and social development must be efficiently coordinated according to the new transmission characteristics of the [Omicron coronavirus] variant,” it added.
Hopeful indicators as stocks rise
Following the release of the Politburo meeting’s statement, Alibaba’s stock rose 15.7 percent, Tencent gained 11.1 percent, while Meituan advanced 15.5 percent at the close of Friday trading.
Alibaba, Tencent, and agriculture-focused tech firm Pinduoduo all recorded their slowest quarterly revenue growth in the fourth quarter of last year. Tencent’s sales grew at its slowest pace in 18 years during the third quarter of 2021.
Last year, Alibaba shares took a hit after it reported a dismal performance for the quarter ending in September. The company’s net income declined by 87 percent year-on-year to 3.4 billion yuan (US$530 million). This was far below analyst predictions who were expecting the company to log in around 24 billion yuan (US$3.76 billion) in net income. Last year, Alibaba had registered 26.5 billion yuan (US$4.15 billion) in net income for the same period.
In addition to profit declines due to ongoing regulatory crackdowns and recent coronavirus lockdowns, tech firms have also struggled to encourage users to spend more money online as China’s economy continues slowing.
Even though the country reported a GDP growth rate of 8.1 percent last year, its fourth-quarter growth was only 4 percent from a year before, marking a slowdown of 4.9 percent in the third quarter and 7.9 percent in the second.
Several international organizations have also downgraded their annual GDP estimates for China to a growth range between 4.0 and 4.5 percent, including a forecast of 4.4 percent released by the International Monetary Fund (IMF) last week.