ANALYSIS | They arrested a Chinese man named ‘Ma’. The news wiped $26 billion from Alibaba shares

China says it will support its big tech companies 1:06 (CNN Business) — For Chinese tech tycoon Jack Ma, there is a price for freedom: $26 billion. Alibaba, the Chinese e-commerce giant co-founded by Ma, saw its Hong Kong-listed shares fall as much as 9.4% on Tuesday after China’s state media reported that an individual surnamed “Ma” had been detained for national security reasons, in the city of Hangzhou, where Alibaba is headquartered. According to China’s state broadcaster CCTV, the suspect was placed under “compulsory measures” on April 25 on suspicion of “collusion with hostile anti-Chinese forces abroad” to “incite secession” and “incite subversion of government power.” Condition”. The one-sentence report, which was quickly picked up by other state media outlets and flagged across Chinese news platforms, triggered a market sell-off in Hong Kong, wiping out some $26 billion from the market in a matter of minutes. Alibaba’s market value. Amid the frenzy, Hu Xijin, former editor-in-chief of the state-run nationalist tabloid Global Times, was quick to clarify on Chinese Weibo Twitter that the report was misleading because the name of the suspect in question has three characters. Jack Ma’s Chinese name, Ma Yun, only has two characters. (CCTV later quietly updated its original report to match Hu’s assessment.) To further allay concerns, the Global Times reported that the defendant was born in 1985 in Wenzhou (while Jack Ma was born in 1964 in Hangzhou), and worked as a director of hardware R&D at an IT company. The clarifications sparked a rally, with Alibaba recouping most of its losses by the end of the day. The market’s rollercoaster reaction is the latest sign of how nervous investors are getting about China’s beleaguered tech sector, which has been the subject of tough regulatory action by the Chinese government since late 2020. Recent signs from the Chinese government that it is preparing to reverse its campaign due to the economic impact, as first reported by The Wall Street Journal, the market frenzy on Tuesday indicates investor sentiment remains shaky. “I thought it was a strange episode,” said Victor Shih, a professor of political science at the University of California, San Diego. “A kind of warning to the tech industry as a whole, or maybe to Jack Ma personally. Who knows? But the truth is that it has been shown that the government does not even have to arrest a top tech executive to erase tens of thousands of million dollars of the market valuation of a company. It is enough to make some kind of information public,” Shih added. “That’s pretty powerful. And certainly what happened yesterday was a clear illustration of that power, whether it was fulfilled or not.” Jack Ma, founder of Alibaba, in Paris in 2019. But the fact that investors were quick to believe that Jack Ma, China’s most high-profile billionaire, would fall into the hands of state security authorities reveals something the political reality in which many Chinese tycoons now live. “It doesn’t matter if it’s really him anymore. The important thing is that a lot of people think it’s him, a lot of people expect it to be him, now that’s interesting,” read a popular comment on Weibo, which garnered 57,000 likes. The turn in public sentiment against Ma is almost as spectacular as his rags-to-riches story. Until about three years ago, the English teacher turned billionaire was widely adored for his charisma, outspokenness and self-taught success. (He was even nicknamed “Papi Ma” or “Daddy Ma” by some fans.) But as tech companies like Alibaba expanded their business empires, they became the target of growing frustration and resentment among young Chinese workers, fed up with grueling hours, high pressure and stagnant wages. (Jack Ma’s endorsement of China’s so-called “996” work culture, which means working 9 a.m. to 9 p.m. six days a week, drew intense criticism in 2019.) As tech giants have fallen into the Chinese government’s crosshairs, “evil capitalists” have increasingly been blamed for various social ills, from cut-throat competition, soaring property prices to a lack of social mobility. “In just a few years, ‘Daddy Ma’ has been labeled a ‘rotten capitalist’ in public opinion, and many people are wishing for Ma’s downfall,” Xiang Dongliang, a blogger, wrote on WeChat. “But the question is whether to topple the capitalists and drive out the [llamadas] foreign forces will really make life better for everyone.” China fines Alibaba, Tencent and Baidu: why? United was detained by regulators in late 2020. In his day, he was among the most outspoken figures in China, but he has not posted anything on Weibo, where he has nearly 25 million followers, since October 2020. His last post on Weibo, about a meeting with a hundred school principals to discuss the future of education in China, was swamped with criticism.”I won’t be surprised if old Ma is jailed one day,” read the most prominent comment.” You are just a capitalist! Don’t pretend to be a good person!” another comment cried out. Jack Ma remained silent throughout Tuesday, as rumors against him swirled on the internet in China. Hashtags about the arrest of the suspect surnamed Ma were among the top trending topics. on Weibo, attracting hundreds of millions of views. “Just be silent, which is a ‘special way of existing,'” Zhang Feng, a columnist, wrote in a widely shared WeChat article after the incident. “This kind of silence has a deep meaning. For a public figure, his speech is an ‘extension’ of his existence. When a person stops talking, although they are still alive, they are still doing things, at least a part of them has ‘vanished'”.