I was thinking about nationalization separately from this. The west has invested a lot into the Chinese economy hoping to translate the corresponding equity into growth. I wonder if the Chinese are really long term interested in honoring the equity.
Meaning - take the money now, grow the businesses and the economy and then at some point say "It's stupid that we're letting foreigners have 20% (or whatever) ownership of our economy" and just deem it illegal / confiscate that equity.
Obviously it will prevent future foreign investment but if China is in a place where they don't care about that, it would be the move.
The CCP has pretty explicitly said and proved that it places itself and its interests above Chinese and/or international law.
It's playing nice with international investment for now, because it's free money, but ultimately any investment in China is only valued to the extent the CCP feels it's in its best interests.
The West's intent was to make China dependent on the international banking and trade system, such that they would provide additional levers to control China's behavior, but we're talking about a government that starved its population to prove a point...
Nothing shy of being able to melt down the Chinese economy is going to change their decision, if they make it.
This is just modern day colonialism - as a leader of a country do you resign to paying a tax to foreign powers forever, or do draw a line in the sand and say enough is enough.
What is interesting is China is even powerful enough to do this. This isn't new - it's what Iran tried under Mosaddegh, and it's a story oft repeated in South America, and each case there is suddenly a CIA backed coup who fights against nationalization.
I don't think China would see any blowback from this - the idea that it would prevent future investment in China is like saying Europe would stop investing in the US after the American revolution; as long as there is some alpha to be made in an economy as large as China's, I'd expect them to still see foreign capital.
I think what it more interesting is the concentration of power in the CCP elite and how that power is wielded. On one side you have the "communist" dream where the nationalization of Alibaba is felt by all Chinese citizens who are given more through socialization - one can imagine what China would look like in another 15 years if they focused on further educating and strengthing their citizenry; its the progressive left's "dream" for America. On the other hand, it's also likely you end up in a situation where power corrupts and nationalization is just an excuse to enrich Xi and his inner circle.
>Obviously it will prevent future foreign investment but if China is in a place where they don't care about that, it would be the move.
In that case the state can still get sued. see: https://en.wikipedia.org/wiki/Yukos_shareholders_v._Russia As for actual compensation to the shareholders, it can range between money seized from foreign accounts (think US treasuries) to sanctions.
Great, glad we will find a way to sanction China when the CCP's skepticism of massive private ownership hurts the interests of the ultra-wealthy in the US, but not when there are massive human rights issues now around how they treat minorities.
"they" being the CCP, or high-net-worth Chinese nationals attempting to get their money out of China?
Because if the latter, then the CCP is not going to give a monkey's what happens to that property. The CCP has been trying to stop rich Chinese from investing outside China for years now.
I'm no expert, but I understood that those were more "diplomatic" investments. The ports in Sri Lanka, for example, are impractical and unused, their function fulfilled as soon as the deal was agreed.
> The west has invested a lot into the Chinese economy hoping to translate the corresponding equity into growth
Chinese people are jointly invest in that venture, by (not limited to):
* Sacrifice family and personal time, by hundreds of millions of passent migration workers.
* Sacrifice health and life quality, even today 996 still a norm, and you can imagine what have been since the opening up
* Environment, early pollution has harmed the people's health and well-being
* Mental health, stressful working time, lack of support
At the top, it was CCP and Western capitalists grabbed most of the profit, but leaving the waste to be suffered by the people.
Case in point, Alibaba's success is a CCP sanctioned monopoly and unfair market competition. I pity Jack Ma's treatment from CCP, I don't pity him as a citizen, he already enjoyed too much beyond what he actually deserves.
As such, I do welcome campaign like the poverty elimination [1]. If CCP does nationalize alibaba and use that to help rural areas to gain access to market, I consider that a positive thing for the vast majority of the poor.
> As such, I do welcome campaign like the poverty elimination [1].
Which is inits entirety a propaganda campaign. I have peers from all across China, poorest parts included. All what 6 people saw were a photoshoot, and a potemkin village.
If you read the article I posted, you'll see that is not a positive report on the campaign. You shall understand that the CCP model is bound to such lipstick cover-up.
But I firmly support the whole idea of eliminating poverty with the accumulated wealth. Essentially a form of compensation by transferring some wealth.
> But I firmly support the whole idea of eliminating poverty with the accumulated wealth. Essentially a form of compensation by transferring some wealth.
No wealth ever changed hands. PM Li's saying of 600m Chinese still living on CNY1000 a month is 100% real.
Why would bolos would in their sane mind empower their enemies, by transfering wealth to them?
> At the top, it was CCP and Western capitalists grabbed most of the profit, but leaving the waste to be suffered by the people.
That framing seems disingenuous given that per capita income in China has increased something like 10x in the last few decades and hundreds of millions have been lifted out of poverty.
Are you asking the same question about what is supposedly an even safer investment, as in are the Americans really long-term interested in honoring its foreign debt? That has quite a bit of ramification beyond shore.
Meaning - take the money now, grow the businesses and the economy and then at some point say "It's stupid that we're letting foreigners have 20% (or whatever) ownership of our economy" and just deem it illegal / confiscate that equity.
Obviously it will prevent future foreign investment but if China is in a place where they don't care about that, it would be the move.