SCOTT SIMON, HOST:
Jack Ma was once hailed as the face of Chinese entrepreneurship for founding Alibaba, the ecommerce giant. But in 2020, he criticized the country's financial system and largely disappeared from public view. Now it seems Jack Ma is back, appearing in Beijing last week, along with other business leaders who were hosted by China's President Xi Jinping.
Duncan Clark wrote the book "Alibaba: The House That Jack Ma Built." He also leads a tech investment advisory firm. Mr. Clark, thanks for being with us.
DUNCAN CLARK: Thanks for having me.
SIMON: What does this mean, Jack Ma back in the spotlight?
CLARK: Yeah. It's a remarkable turn of events. I mean, he was sort of deplatformed, if you can say, in October 2020. He took on the Chinese government in a very forthright criticism of regulation and sort of talking about the power of technology and the need for government to step aside. That did not end well for him. It wasn't a Russian-style sort of solution, but he was out of public view for several months and then only very occasionally seen since. But suddenly, to be in the front row of a group of China's leading tech executives and actually shaking hands with President Xi Jinping clearly signals a new approach by the government to him and perhaps to the broader tech sector.
SIMON: How so? What's it mean?
CLARK: Well, I mean, the origins of the crackdown on both Jack Ma and also other tech practices in China was that the government was feeling a bit nervous that these companies are getting too big for their boots, you know, particularly, the financial sector, which is really controlled by the Chinese government in terms of state banks, et cetera. And so by taking down Jack Ma, if you will, it was a signal to the private sector to stay in their lane. But that lane has been very slow, let's say. The growth of the Chinese economy really has been very low, particularly with the downturn in the property sector, obviously, the trade tensions with the U.S., not to mention the terrible impact of the zero-COVID policy. China's growth, which we all became accustomed to as being, you know, high single digits, if not more, has really slowed down. And now the big question is, is Xi turning to the tech sector to help him out?
SIMON: So this was not just sentiment. Is the Chinese government trying to signal something to the - their tech sector and entrepreneurship?
CLARK: Yes. I think, and, you know, one cannot not think about the inauguration of President Trump and, you know, the assembled tech executives alongside the incumbent president. What a contrast that was to this freezing out of many tech companies in China. It's not that we see Xi sitting on the same side of the table as these tech guys, but there is - you know, they're in the same room. It was interesting. It was theater, really, because Xi Jinping was filmed basically lecturing the assembled tech executives. They were all taking notes, dutifully listening. But the very fact that he met them and shook a few hands was - in the theater of Chinese politics was seen as significant.
SIMON: How strong is China's tech sector?
CLARK: Well, as we saw with the company DeepSeek a few weeks ago, which jittered global markets, China is not lying down and saying, you know, the U.S. dominance is cemented now in areas like artificial intelligence. We've also seen that in the past in various other technologies like with the company Huawei. And so, you know, China basically has big ambitions. Xi Jinping has not been humble about those ambitions. He wants to rival, if not overtake, the U.S. in certain areas. And, of course, they graduate probably half of the world's tech talent, if you will, including in AI. So China - Chinese are big players in global tech. Whether China itself can be dominant remains to be seen, but Xi Jinping is giving it a go.
SIMON: Do you see the Chinese economy improving, given your experience?
CLARK: It's pretty grim at the moment, I would say. There's a large property overhang because, you know, most Chinese own their homes, and most of them have seen big losses on their holdings because they used to invest most of their savings into their homes - and multiple homes, actually. And so the crackdown on property developers - which probably was overdue in terms of leverage, et cetera - has been very damaging. So I think this attempt to boost the tech sector with these successes like DeepSeek in AI are lifting spirits. Whether it'll translate into more confidence across the board remains to be seen, but it's certainly a helpful sign.
SIMON: What about the relationship, maybe I should call that competition, between the U.S. and China and the prospect of increase of tariffs.
CLARK: Yeah. So China's been preparing for quite some time. Of course, you know, this is not their first rodeo with President Trump. And, you know, they knew what was coming. So, you know, China has been reducing, actually, its dependence on the U.S., both as a supplier of key technology, although not completely, but also as an export market, you know, aware that this would come. And in some Chinese companies, of course, famously are setting up in Vietnam or Mexico and trying ways to get around it. But at the end of the day, China remains a manufacturing powerhouse for the world. And in tech, it's also a very important player. So China will remain a key factor in the U.S. economy going forward - certainly less than it has been, but it's not so easy to completely decouple, as has been tried.
SIMON: Duncan Clark's book is "Alibaba: The House That Jack Ma Built." Thank you so much for being with us.
CLARK: Thank you.
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