Quietly, the Chinese government is turning against Alibaba.
There have been no direct official statements from leaders, but there don’t have to be, because we know how China works.
The state media has been highlighting negative aspects of the company since last week.
These are things that have always been issues for Alibaba, but suddenly they are fodder for the country’s tightly-controlled media — a media that doesn’t usually criticise domestic companies.
Now you may be asking yourself, why would the Chinese government turn against one of the country’s biggest business success stories?
It could go back to an anti-Xi Jinping article published on an Alibaba owned news site in Western China.
Last week the Washington Post reported that Wujie News, which is jointly owned by SEEC Media Group, Alibaba and the government of Xinjiang (a province in Western China), published a scathing editorial against President Xi Jinping.
The editorial accused him of ditching collective rule by China’s Communist Party and becoming an autocrat. None of this is news to Western observers, but it’s definitely something you don’t say on the mainland.
And you definitely don’t say it in Xinjiang, the province that is home to China’s Muslim minority, the Uygurs.
The letter, signed “loyal Communist Party members,” lambasts China’s president for “abandoning the principle of collective leadership,” for concentrating power in his own hands and “indulging” flatterers. Xi’s declaration that the press should serve the party, not the people “dismayed the whole nation,” it charges.
This all went down after Xi’s government released a bunch of creepy new restrictions on the media. The editorial was swiftly taken down.
Since then a couple of weird things have happened to Alibaba.
For the first time, China’s state television station CCTV, ran a documentary slamming Alibaba for fake goods on its website. Alibaba says that it spends hundreds of millions of dollars combating this problem and media outlets outside of China have been talking about it for over a year.
But for some reason, now this is an issue in China.
Another weird thing — the Chinese government is now scrutinizing one of Alibaba’s new businesses, an online food delivery service called Ele.me. It’s a fast growing market in which Alibaba is the biggest player, with a 33.7% market share. The government is accusing it of allowing unqualified vendors to sell food on its platform. Two Chinese state agencies are now investigating the company.
Who knows how far this will go. Jack Ma could apologise to Xi Jinping, assure him that Alibaba is not a power big enough to challenge the government, and they could all be friends again.
Or this could turn into a Russia vs. The Oligarchs, China style.
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