The news: Chinese President Xi Jinping said Beijing’s antitrust campaign, designed to “prevent the irrational expansion of capital” and address “barbarous growth” in China’s technology sector, is yielding results, per the South China Morning Post.
How we got here: China produces billionaires faster than any other country, but there is widening public dissatisfaction with the resulting income disparity.
Why it’s worth watching: Beijing’s intensifying crackdown on Big Tech companies erased $1 trillion in value from Chinese stocks this year alone. Continued regulatory tightening could stifle expansion into foreign markets—as evidenced by the fallout following Chinese ride-sharing service Didi Chuxing’s US IPO this summer.
What’s next? China’s monolithic technology companies have thrived and expanded mostly because they were left unregulated. The sudden wave of government scrutiny could force changes to how China’s Big Tech companies conduct their business going forward. This could lead to some innovation stagnation, as well as a cautious outlook from investors and overseas partners.