Xi wanted China to be at the tech frontier. 5 years on, tensions with the U.S. have dented that goal
Summary
The Biden administration unveiled a slew of restrictions last week that aim to cut China off from key chips and manufacturing tools to make those semiconductors. Thats because part of the rules also require certain foreign-made chips that use American tools and software in the design and manufacturing process, to obtain a license before being exported to China. But the pace at which regulations were passed and the scope of the rules took investors off guard, and billions were wiped off the share prices of Chinas biggest tech companies — including Alibaba and Tencent — in 2021 and 2022. Part of the story, analysts say, is about Xi exerting more control over powerful technology businesses that were perceived as a threat to the ruling Communist Party of China. Even if regulatory actions are "moving into a new phase" in Xis third term, companies like Alibaba and Tencent wont necessarily see the breakneck growth speeds theyve seen in the past, Mok said.