BEIJING (Reuters) -China on Wednesday sent another strong signal that a years-long crackdown on its tech industry is over as Premier Li Qiang met firms such as Alibaba’s cloud unit and Meituan, and urged them to do more to support the economy.
After listening to suggestions from firms that also included PDD Holdings’ Pinduoduo and JD.com, Li told them authorities would seek to make regulation of platform firms more transparent and predictable.
Shares in some U.S.-listed Chinese firms rallied in premarket trade, with Alibaba Group Holding gaining 2.2% and PDD Holdings rising 2.7%. Other companies named as attending included ByteDance’s Douyin, the Chinese equivalent of TikTok, and cargo service platform Huolala.
The meeting comes after authorities signalled last week that a crackdown that began in late 2020 on the technology sector had ended with fines on Ant Group and Tencent.
During the campaign, which wiped $1.1 trillion off the combined market value of the biggest players, regulators repeatedly criticised and punished those companies for violations ranging from failing to protect customer privacy to monopolistic behaviour.
But Beijing’s tone has softened since December, with authorities shifting to stress the need to revitalise the sprawling online platform sector, as the economy recovers at a slower-than-anticipated rate following the end of COVID curbs.
“We hope that the majority of platform enterprises will look forward with firm confidence … continue to promote innovation and breakthroughs, better empower the real economy,” Li said at Wednesday’s meeting, according to state media.
“Governments at all levels should endeavour to create a fair and competitive market environment, and improve policies on investment access,” he said.
Despite the recent signals, however, some fund managers told Reuters that they would continue to steer clear of the sector, citing expectations of stringent regulation in the future and the flagging domestic economy.
Still Zhou Hao, economist at Guotai Junan International, said Wednesday’s meeting was a “positive signal”.
“A sound development of the platform economy is very significant to investors too. Prudent development of platform firms is important to investors’ long-term valuation,” he added.
(Reporting by Ella Cao, Brenda Goh, Ellen Zhang, Ethan Wang and Ryan WooEditing by Barbara Lewis and Mark Potter)
