February 25, 2025 • 15 mins
Four years after launching a regulatory crackdown that plunged the tech sector into turmoil, China’s President Xi Jinping sat down publicly with Alibaba Group’s co-founder Jack Ma, whose firm bore the brunt of that campaign, and a number of other tech titans.
On today's Big Take Asia Podcast, host K. Oanh Ha talks to Bloomberg’s Lucille Liu and Opinion columnist Catherine Thorbecke about Xi’s shifting stance and where the tech industry goes from here.
Read more: Xi’s Embrace of China Tech CEOs Spurs Hope of Big Economic Shift - Bloomberg
Further listening: China’s New Game Plan For Dealing with Trump Tariffs
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Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:08):
On the eve of every Lunar New Year, hundreds of
millions of Chinese all tune in to watch one live show,
the Spring Festival Gallup. The Gala is an extravaganza. It
often features the biggest celebrities in China and internationally. Stars
(00:28):
like Jackie Chan and Celine Dion have taken the stage
in previous years, but this year one performance stood out
for a very different reason.
Speaker 3 (00:39):
All of a sudden, you have these sort of six
feet tall, black dancey robots dressed in bright red traditional
Chinese vest, spinning handkerchiefs with both armed.
Speaker 2 (00:50):
Lucille lu is a Bloomberg reporter covering China's economy and
politics based in Beijing.
Speaker 3 (00:55):
The way they moved, of course, just felt bizarre or
it was just weird, but it was definitely a very
memorable performance.
Speaker 2 (01:04):
The humanoid robots are made by a Chinese startup called
Unitary Robotics, and the performance was directed by one of
the best in China, jug Yimo, who is behind the
opening and closing ceremonies of the two thousand and eight
Beijing Olympics. And Lucille says this performance seemed to be
more than just a festive celebration.
Speaker 3 (01:23):
The New Year's Gala is supposed to reflect social trends,
but it's also a way to show some guesses at
the government agenda or priorities, and this performance I think
was the first time, of course, for the Year of
the Snake, that showed that the Chinese government is perhaps
warming to its tech giants.
Speaker 2 (01:41):
It seems significant because China's tech giants have been sidelined
since twenty twenty when China's President Shijinping cracked down on
the tech industry, and putting the robots center stage felt
like the beginning of a reconciliation of sorts. And then
last week she did something that made a lot of
China watchers think that the tech comeback is.
Speaker 1 (02:01):
Real, thinking she'd see Hotel.
Speaker 3 (02:05):
President c basically sat down with many of the biggest
names in Chinese business over the past decade. So there
was Jack Ma from Ali Baba, Huawei founder Jin Jim
Fei byd but also newcomers to the scene like the
founder of Unitree Robotics that made those robots in the
Spring Gala, and also Deep Seek and I think in
many ways you know it looked like he was assembling
(02:27):
the Avengers team on stage.
Speaker 2 (02:33):
Welcome to the Big Take Asia from Bloomberg News. I'm wanh.
Every week we take you inside some of the world's
biggest and most powerful economies and the markets, tycoons and
businesses that drive this ever shifting region. Today on the
show China's Big Tech Coming Back in from the Cold?
What does it mean for China's tech industry and its
(02:55):
rivals in the US. To understand how big a deal
it is to see China's president cozying up with tech
company CEOs, we have to go back to November twenty twenty.
That's when Beijing pulled the plug on the initial public
offering of ant Group, just two days before what would
(03:18):
have been the biggest IPO of all time.
Speaker 3 (03:21):
I just remember those days in the newsroom because there
was so much disbelief over this eleventh hour hauld of
the world's biggest IPO. Jack Maa's ANT Group was set
to raise thirty five billion dollars in Shanghai in Hong
Kong and really cement his status as the richest man
in China. Before this IPO, Jack Maa gives a speech
accusing regulators of focusing too much on risk and stifling innovation.
(03:44):
And shortly after we know he's called Beijing, and before
you know it, this IPO is suspended and authorities are
saying that they have belatedly discovered all these shortcomings that
basically required and overhauled the company.
Speaker 2 (03:57):
I mean that was shocking to both the world but
also to all of these Chinese internet companies too, right.
Speaker 3 (04:02):
Yeah, absolutely, I mean looking back, that really marked the
start of the series of crackdowns on the tech sector,
primarily in the name of reigning and monopolies. And when
it was all over, it had wiped something over a
trillion dollars from the market value of some of China's
biggest tech firms. You know, we saw these very large
finds being handed to the likes of and ten Cent
(04:23):
DD and meanwhile state media is writing these editorials slamming
these internet companies for their preoccupation with growing traffic, you know,
at the expense of real scientific innovation. So it was
a tough time to be a tech company, especially in
the internet sector.
Speaker 2 (04:39):
Lucille, what was behind the tech crackdown in the first place.
Speaker 3 (04:42):
Yeah, there was certainly a sense that these companies had
grown too powerful, too influential. They had amassed millions of users,
and they gained influence over you know, every aspect of
daily life in China. So the outside powers of these
tech mocuals was being increasingly perceived as this threat to
political and also financial stability, so as being perceived by
(05:04):
investors as a message from the top that money needed
to align with China's national strategies, rather than the tech
companies doing what was most financially beneficial to them.
Speaker 2 (05:15):
Lucille says Beijing's crackdown on the excesses of the tech
sector and private business also brought about a cultural shift
in China. It was no longer glorious to be rich,
and with that sentiment running high, business moguls like jackmw
retreated from the public. GUYE.
Speaker 3 (05:33):
Jack Law was such an outspoken entrepreneur and suddenly basically
he'd gone quiet, And the next thing we heard from him,
he was at a golf course, you know, basically taking
a backseat to operating the company. So it was a
very sudden change for a lot of these tech companies
and these tech moguls.
Speaker 2 (05:51):
And during the years following the crackdown in twenty twenty,
Chinese tech companies found themselves struggling with a challenging regulatory environs,
not just at home but also abroad.
Speaker 3 (06:03):
They were also facing these blacklist sanctions from the US
because there was the trade war, and then the Biden
administration continued a lot of those policies. A lot of
these companies didn't come out unscathed. We saw DD and
really at a fraction of their valuation at their height.
So it was very difficult for these companies, but they
found a way to grow and survive, and so some
(06:24):
of them managed even in this restrictive environment to develop
new technology and make new breakthroughs.
Speaker 2 (06:31):
Are there any companies that did well during this period
that stand out for you?
Speaker 3 (06:35):
There were the old national champions, for example, like Huawei.
Huawei was blacklisted by the US on security concerns, but
it did double down to R and D BYD is
definitely an example of a company that's made waves overseas.
It's going head to head with Tesla in terms of
revenues and sales with its much more affordable evs.
Speaker 2 (06:54):
Then there's the AI company deep Seek. It gave the
world a real surprise when it showed the event. Is
Chinese tech companies can achieve even with US curbs on
critical chips.
Speaker 3 (07:05):
Deep Seak was an example of what can come out
of these restrictions. It was because of that limited number
of chips that they had access to that forced the
team to find ways to get more used from the
chips they had, and that was a defining factor and
how they were able to drive down costs.
Speaker 2 (07:21):
And then fast forward to last week when President she
held a meeting with all of the big names in tech.
Speaker 3 (07:27):
We just talked about and more we shall Kwami show faith.
This was a tightly choreographed pro business rally. You had
ten set sell me Wil, Semi Conductor, Huawei, just the
biggest names in China tech. But very importantly Jackmaw was there.
So when we asked investors what would it take to
(07:50):
regain confidence in the Chinese market, people would literally say
President c would need to sit down with Jackmaw. And
now it was really happening.
Speaker 2 (08:00):
It's interesting why is Jack ma so pivotal for tech
and why did people really want to see that kind
of meeting between she and Maw.
Speaker 3 (08:09):
Yeah, I think because he was such a poster child
at the tech crackdown. There's certainly a lot of symbolism
in se willing to meet with Jack Ma again and
bring him out from the cold, put back in the
good graces. And I think that sent a strong message
in the Chinese bureaucracy to lower levels that perhaps there
is a slightly different attitude now coming out of Beijing
(08:30):
towards its private sector.
Speaker 2 (08:34):
She's sentiment shift towards China's big tech Is it for
real or is it just for show? That's after the break.
President Shi Jinping's high profile meeting with China's top entrepreneurs
(08:55):
last week wasn't the first ever. In twenty eighteen, at
the beginning of Donald Trump's first trade war, she chaired
a similar conference with leaders in the private sector, and
at that meeting, he expressed unwavering support for the growth
of private businesses. But the meeting was largely seen as symbolic.
We asked Katherine Thorbeck, a Bloomberg opinion columnist covering Asia tech,
(09:19):
to join our conversation with Lucille Liu. Catherine, this looks
like a real U turn by presidence. She he really
seems to have it in for Chinese tech companies now
they're all friendly. What's different this time around?
Speaker 1 (09:31):
I think a lot has changed for the Chinese tech sectors,
and most of it hasn't been good. The US has
really put in sort of new efforts to hold back
Chinese tech sector this time, whether that's export controls, hip restrictions.
So chinae tech sectors coming out of those headwinds.
Speaker 2 (09:49):
Lucille, you're on the ground there. What changes have you seen?
Speaker 3 (09:52):
Yeah, I mean a lot has happened in the intervening years.
You know, there was the COVID lockdown of property crisis
that's still ongoing. You know, demographic challenge unges, and you
know a sluggish economy where consumer sentiment is still weak.
So Presidency knows he needs to boost confidence and send
the signal for the bureaucracy that China needs to support
(10:12):
its private firms and especially in the tech sector. And
by Bloomberg Economic calculations, the high tech industry contributed to
fifteen percent of GDP last year and it's set to
overtake the housing sector in twenty twenty six.
Speaker 2 (10:25):
So very very important to China's success and certainly economic
well being, especially as it tries to write the economy.
Speaker 3 (10:33):
Yeah, that's absolutely right.
Speaker 2 (10:34):
So the Chinese government has been scrutinizing the tech sector
in the last couple of years, particularly the tech giants
that perhaps are seen is too powerful by the party,
But now here it is extending an olive branch. Lucille,
do you sense that the tech companies are really buying
it this time or are they skeptical? Yeah?
Speaker 3 (10:54):
I think that that moment the meeting, it seems to
really capture this moment where it's private or tech interests
and maybe the party's own interests align and where See
thinks the tech sector do something for them, and of
course the tech sector is more than happy to benefit
from state support. It's a point in the relationship where
I think there are some common interests, but of course
we've seen in the past the interests often diverge.
Speaker 1 (11:17):
Yeah, I would agree. I think it's going to be
really hard for people to not see this as a
bit of a publicity stunt. If this isn't followed up
by actual sort of policy changes, it's hard to tell
if this gesture of goodwill will be sustainable or if
it's more ephemeral, and I have a feeling it might
not last. You know, I don't see she ultimately being
okay with these private sector leaders having so much power
(11:41):
and threatening his political grip. So I think we will
have to see if this is followed up by actual
policy changes. At the same time, there though, I think
she would be wise to sort of recognize that most
of the best innovations that have come out of China
have really come from the private sector. They haven't really
come from his sort of state owned in state enterprises.
Speaker 2 (12:01):
And you've got innovations like Deepseek's ai chatbot that recently
caught global investors by surprise. Let me change the perspective
a little here and ask you why do you think
the US keeps getting surprised by Chinese tech.
Speaker 1 (12:15):
I think some of it is language barriers and cultural
barriers and few foreign reporters actually in China, and separate
social media ecosystems. But I also think that there's some
entrenched biases in the US and in Silicon Valley when
it comes to China, and there's definitely a bit of
sort of sinophobia. And I think, you know, US tech
leaders paint themselves as the only people that can really
(12:35):
predict future trends and see the future. They've always had
this presumed lead over Chinese tech, and so I think
that there's a lot of barriers that the US has
to really understand in China, and I think that it's
important for Silicon Valley to sort of break those down,
otherwise they will keep being surprised.
Speaker 2 (12:51):
You called them the US tech rolagarchy in a recent column.
Can you explain that to us? So?
Speaker 1 (12:56):
I do have to give credit to my editor for
adding that in, but it is it's just so applicable
to this moment we're seeing in US tech right now,
where these tech billionaires, these very powerful business leaders have
just been positioning themselves and trying to get very close
to the Trump administration, and that's just been giving them
even more power and more influence.
Speaker 2 (13:15):
And at Donald Trump's inauguration in January, he was surrounded
by all of these tech titans. You had Mark Zuckerberg,
Jeff Bezos, Tim Cook, and of course Elon Musk. Do
you see any similarities between this US tech roly garchy
and what happened with the recent meeting in China.
Speaker 1 (13:32):
It does seem like she responded to Trump showing up
with his tech leaders to show that he also has
this sort of the port and he also has some
very powerful tech players in his ecosystem. But at the
same time, I don't think that he would allow them
to have the same kind of power and political influence
that they're having in the US right now.
Speaker 2 (13:50):
Right and certainly Silicon Valley and Washington d C. Are
worried about China's tech over national security and other issues.
So now you've got these Chinese tech companies appearing to
be back in the good graces with President Shi Jinping
and on the rise in China, but there's still somewhat
second string to American firms.
Speaker 1 (14:07):
Right What are the.
Speaker 2 (14:08):
Biggest challenges for Chinese tech companies as they try to
close that gap.
Speaker 1 (14:13):
I think that we've learned from the TikTok saga, which
has just raged on for years, that at this point
Washington and US lawmakers really see any sort of consumer
facing tech product coming out of China as a potential
national security threat. They see any Chinese tech company is
potentially connected to the government, their success is a vouch
for their political system, and you know, threat to democracy everywhere.
(14:36):
And I think whether or not that's true, I think
we'll still see these Chinese tech companies producing these innovations,
and I do think, you know, if they want to
find a way to grow in the US market. That's
going to be a real challenge ahead, and I don't
think any of them, as we've seen from TikTok, have
really figured that out yet.
Speaker 3 (14:52):
I think the political wines in daging are always a factor.
We've seen them swing. There's been a lot of whiplash
in the industry where things have gone one way and
then the other. So I think very reasonably for a
lot of these tech firms, there is still questions over
sort of Beijing's commitment to continue to to support them.
Speaker 2 (15:15):
This is The Big Take Asia from Bloomberg News. I'm
wan Ha. This episode was produced by Young Young, Naomi
and Jessica Beck. It was edited by Patty Hirsch, Daniel
ten Kate, and Jenny Marsh. It was fact checked by
Naomi and Young, mixed by Amer Salton, and sound designed
by Jessica. Our senior producer is Naomi Shaven. Our senior
(15:35):
editor is Elizabeth Ponzo. Our executive producer is Nicole Beemster Bower.
Sage Bowman is Bloomberg's head of Podcasts. If you like
this episode, make sure to subscribe and review The Big
Take Asia wherever you listen to podcasts, It really helps
people find the show. Thanks for listening, See you next time.
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:08):
On the eve of every Lunar New Year, hundreds of
millions of Chinese all tune in to watch one live show,
the Spring Festival Gallup. The Gala is an extravaganza. It
often features the biggest celebrities in China and internationally. Stars
(00:28):
like Jackie Chan and Celine Dion have taken the stage
in previous years, but this year one performance stood out
for a very different reason.
Speaker 3 (00:39):
All of a sudden, you have these sort of six
feet tall, black dancey robots dressed in bright red traditional
Chinese vest, spinning handkerchiefs with both armed.
Speaker 2 (00:50):
Lucille lu is a Bloomberg reporter covering China's economy and
politics based in Beijing.
Speaker 3 (00:55):
The way they moved, of course, just felt bizarre or
it was just weird, but it was definitely a very
memorable performance.
Speaker 2 (01:04):
The humanoid robots are made by a Chinese startup called
Unitary Robotics, and the performance was directed by one of
the best in China, jug Yimo, who is behind the
opening and closing ceremonies of the two thousand and eight
Beijing Olympics. And Lucille says this performance seemed to be
more than just a festive celebration.
Speaker 3 (01:23):
The New Year's Gala is supposed to reflect social trends,
but it's also a way to show some guesses at
the government agenda or priorities, and this performance I think
was the first time, of course, for the Year of
the Snake, that showed that the Chinese government is perhaps
warming to its tech giants.
Speaker 2 (01:41):
It seems significant because China's tech giants have been sidelined
since twenty twenty when China's President Shijinping cracked down on
the tech industry, and putting the robots center stage felt
like the beginning of a reconciliation of sorts. And then
last week she did something that made a lot of
China watchers think that the tech comeback is.
Speaker 1 (02:01):
Real, thinking she'd see Hotel.
Speaker 3 (02:05):
President c basically sat down with many of the biggest
names in Chinese business over the past decade. So there
was Jack Ma from Ali Baba, Huawei founder Jin Jim
Fei byd but also newcomers to the scene like the
founder of Unitree Robotics that made those robots in the
Spring Gala, and also Deep Seek and I think in
many ways you know it looked like he was assembling
(02:27):
the Avengers team on stage.
Speaker 2 (02:33):
Welcome to the Big Take Asia from Bloomberg News. I'm wanh.
Every week we take you inside some of the world's
biggest and most powerful economies and the markets, tycoons and
businesses that drive this ever shifting region. Today on the
show China's Big Tech Coming Back in from the Cold?
What does it mean for China's tech industry and its
(02:55):
rivals in the US. To understand how big a deal
it is to see China's president cozying up with tech
company CEOs, we have to go back to November twenty twenty.
That's when Beijing pulled the plug on the initial public
offering of ant Group, just two days before what would
(03:18):
have been the biggest IPO of all time.
Speaker 3 (03:21):
I just remember those days in the newsroom because there
was so much disbelief over this eleventh hour hauld of
the world's biggest IPO. Jack Maa's ANT Group was set
to raise thirty five billion dollars in Shanghai in Hong
Kong and really cement his status as the richest man
in China. Before this IPO, Jack Maa gives a speech
accusing regulators of focusing too much on risk and stifling innovation.
(03:44):
And shortly after we know he's called Beijing, and before
you know it, this IPO is suspended and authorities are
saying that they have belatedly discovered all these shortcomings that
basically required and overhauled the company.
Speaker 2 (03:57):
I mean that was shocking to both the world but
also to all of these Chinese internet companies too, right.
Speaker 3 (04:02):
Yeah, absolutely, I mean looking back, that really marked the
start of the series of crackdowns on the tech sector,
primarily in the name of reigning and monopolies. And when
it was all over, it had wiped something over a
trillion dollars from the market value of some of China's
biggest tech firms. You know, we saw these very large
finds being handed to the likes of and ten Cent
(04:23):
DD and meanwhile state media is writing these editorials slamming
these internet companies for their preoccupation with growing traffic, you know,
at the expense of real scientific innovation. So it was
a tough time to be a tech company, especially in
the internet sector.
Speaker 2 (04:39):
Lucille, what was behind the tech crackdown in the first place.
Speaker 3 (04:42):
Yeah, there was certainly a sense that these companies had
grown too powerful, too influential. They had amassed millions of users,
and they gained influence over you know, every aspect of
daily life in China. So the outside powers of these
tech mocuals was being increasingly perceived as this threat to
political and also financial stability, so as being perceived by
(05:04):
investors as a message from the top that money needed
to align with China's national strategies, rather than the tech
companies doing what was most financially beneficial to them.
Speaker 2 (05:15):
Lucille says Beijing's crackdown on the excesses of the tech
sector and private business also brought about a cultural shift
in China. It was no longer glorious to be rich,
and with that sentiment running high, business moguls like jackmw
retreated from the public. GUYE.
Speaker 3 (05:33):
Jack Law was such an outspoken entrepreneur and suddenly basically
he'd gone quiet, And the next thing we heard from him,
he was at a golf course, you know, basically taking
a backseat to operating the company. So it was a
very sudden change for a lot of these tech companies
and these tech moguls.
Speaker 2 (05:51):
And during the years following the crackdown in twenty twenty,
Chinese tech companies found themselves struggling with a challenging regulatory environs,
not just at home but also abroad.
Speaker 3 (06:03):
They were also facing these blacklist sanctions from the US
because there was the trade war, and then the Biden
administration continued a lot of those policies. A lot of
these companies didn't come out unscathed. We saw DD and
really at a fraction of their valuation at their height.
So it was very difficult for these companies, but they
found a way to grow and survive, and so some
(06:24):
of them managed even in this restrictive environment to develop
new technology and make new breakthroughs.
Speaker 2 (06:31):
Are there any companies that did well during this period
that stand out for you?
Speaker 3 (06:35):
There were the old national champions, for example, like Huawei.
Huawei was blacklisted by the US on security concerns, but
it did double down to R and D BYD is
definitely an example of a company that's made waves overseas.
It's going head to head with Tesla in terms of
revenues and sales with its much more affordable evs.
Speaker 2 (06:54):
Then there's the AI company deep Seek. It gave the
world a real surprise when it showed the event. Is
Chinese tech companies can achieve even with US curbs on
critical chips.
Speaker 3 (07:05):
Deep Seak was an example of what can come out
of these restrictions. It was because of that limited number
of chips that they had access to that forced the
team to find ways to get more used from the
chips they had, and that was a defining factor and
how they were able to drive down costs.
Speaker 2 (07:21):
And then fast forward to last week when President she
held a meeting with all of the big names in tech.
Speaker 3 (07:27):
We just talked about and more we shall Kwami show faith.
This was a tightly choreographed pro business rally. You had
ten set sell me Wil, Semi Conductor, Huawei, just the
biggest names in China tech. But very importantly Jackmaw was there.
So when we asked investors what would it take to
(07:50):
regain confidence in the Chinese market, people would literally say
President c would need to sit down with Jackmaw. And
now it was really happening.
Speaker 2 (08:00):
It's interesting why is Jack ma so pivotal for tech
and why did people really want to see that kind
of meeting between she and Maw.
Speaker 3 (08:09):
Yeah, I think because he was such a poster child
at the tech crackdown. There's certainly a lot of symbolism
in se willing to meet with Jack Ma again and
bring him out from the cold, put back in the
good graces. And I think that sent a strong message
in the Chinese bureaucracy to lower levels that perhaps there
is a slightly different attitude now coming out of Beijing
(08:30):
towards its private sector.
Speaker 2 (08:34):
She's sentiment shift towards China's big tech Is it for
real or is it just for show? That's after the break.
President Shi Jinping's high profile meeting with China's top entrepreneurs
(08:55):
last week wasn't the first ever. In twenty eighteen, at
the beginning of Donald Trump's first trade war, she chaired
a similar conference with leaders in the private sector, and
at that meeting, he expressed unwavering support for the growth
of private businesses. But the meeting was largely seen as symbolic.
We asked Katherine Thorbeck, a Bloomberg opinion columnist covering Asia tech,
(09:19):
to join our conversation with Lucille Liu. Catherine, this looks
like a real U turn by presidence. She he really
seems to have it in for Chinese tech companies now
they're all friendly. What's different this time around?
Speaker 1 (09:31):
I think a lot has changed for the Chinese tech sectors,
and most of it hasn't been good. The US has
really put in sort of new efforts to hold back
Chinese tech sector this time, whether that's export controls, hip restrictions.
So chinae tech sectors coming out of those headwinds.
Speaker 2 (09:49):
Lucille, you're on the ground there. What changes have you seen?
Speaker 3 (09:52):
Yeah, I mean a lot has happened in the intervening years.
You know, there was the COVID lockdown of property crisis
that's still ongoing. You know, demographic challenge unges, and you
know a sluggish economy where consumer sentiment is still weak.
So Presidency knows he needs to boost confidence and send
the signal for the bureaucracy that China needs to support
(10:12):
its private firms and especially in the tech sector. And
by Bloomberg Economic calculations, the high tech industry contributed to
fifteen percent of GDP last year and it's set to
overtake the housing sector in twenty twenty six.
Speaker 2 (10:25):
So very very important to China's success and certainly economic
well being, especially as it tries to write the economy.
Speaker 3 (10:33):
Yeah, that's absolutely right.
Speaker 2 (10:34):
So the Chinese government has been scrutinizing the tech sector
in the last couple of years, particularly the tech giants
that perhaps are seen is too powerful by the party,
But now here it is extending an olive branch. Lucille,
do you sense that the tech companies are really buying
it this time or are they skeptical? Yeah?
Speaker 3 (10:54):
I think that that moment the meeting, it seems to
really capture this moment where it's private or tech interests
and maybe the party's own interests align and where See
thinks the tech sector do something for them, and of
course the tech sector is more than happy to benefit
from state support. It's a point in the relationship where
I think there are some common interests, but of course
we've seen in the past the interests often diverge.
Speaker 1 (11:17):
Yeah, I would agree. I think it's going to be
really hard for people to not see this as a
bit of a publicity stunt. If this isn't followed up
by actual sort of policy changes, it's hard to tell
if this gesture of goodwill will be sustainable or if
it's more ephemeral, and I have a feeling it might
not last. You know, I don't see she ultimately being
okay with these private sector leaders having so much power
(11:41):
and threatening his political grip. So I think we will
have to see if this is followed up by actual
policy changes. At the same time, there though, I think
she would be wise to sort of recognize that most
of the best innovations that have come out of China
have really come from the private sector. They haven't really
come from his sort of state owned in state enterprises.
Speaker 2 (12:01):
And you've got innovations like Deepseek's ai chatbot that recently
caught global investors by surprise. Let me change the perspective
a little here and ask you why do you think
the US keeps getting surprised by Chinese tech.
Speaker 1 (12:15):
I think some of it is language barriers and cultural
barriers and few foreign reporters actually in China, and separate
social media ecosystems. But I also think that there's some
entrenched biases in the US and in Silicon Valley when
it comes to China, and there's definitely a bit of
sort of sinophobia. And I think, you know, US tech
leaders paint themselves as the only people that can really
(12:35):
predict future trends and see the future. They've always had
this presumed lead over Chinese tech, and so I think
that there's a lot of barriers that the US has
to really understand in China, and I think that it's
important for Silicon Valley to sort of break those down,
otherwise they will keep being surprised.
Speaker 2 (12:51):
You called them the US tech rolagarchy in a recent column.
Can you explain that to us? So?
Speaker 1 (12:56):
I do have to give credit to my editor for
adding that in, but it is it's just so applicable
to this moment we're seeing in US tech right now,
where these tech billionaires, these very powerful business leaders have
just been positioning themselves and trying to get very close
to the Trump administration, and that's just been giving them
even more power and more influence.
Speaker 2 (13:15):
And at Donald Trump's inauguration in January, he was surrounded
by all of these tech titans. You had Mark Zuckerberg,
Jeff Bezos, Tim Cook, and of course Elon Musk. Do
you see any similarities between this US tech roly garchy
and what happened with the recent meeting in China.
Speaker 1 (13:32):
It does seem like she responded to Trump showing up
with his tech leaders to show that he also has
this sort of the port and he also has some
very powerful tech players in his ecosystem. But at the
same time, I don't think that he would allow them
to have the same kind of power and political influence
that they're having in the US right now.
Speaker 2 (13:50):
Right and certainly Silicon Valley and Washington d C. Are
worried about China's tech over national security and other issues.
So now you've got these Chinese tech companies appearing to
be back in the good graces with President Shi Jinping
and on the rise in China, but there's still somewhat
second string to American firms.
Speaker 1 (14:07):
Right What are the.
Speaker 2 (14:08):
Biggest challenges for Chinese tech companies as they try to
close that gap.
Speaker 1 (14:13):
I think that we've learned from the TikTok saga, which
has just raged on for years, that at this point
Washington and US lawmakers really see any sort of consumer
facing tech product coming out of China as a potential
national security threat. They see any Chinese tech company is
potentially connected to the government, their success is a vouch
for their political system, and you know, threat to democracy everywhere.
(14:36):
And I think whether or not that's true, I think
we'll still see these Chinese tech companies producing these innovations,
and I do think, you know, if they want to
find a way to grow in the US market. That's
going to be a real challenge ahead, and I don't
think any of them, as we've seen from TikTok, have
really figured that out yet.
Speaker 3 (14:52):
I think the political wines in daging are always a factor.
We've seen them swing. There's been a lot of whiplash
in the industry where things have gone one way and
then the other. So I think very reasonably for a
lot of these tech firms, there is still questions over
sort of Beijing's commitment to continue to to support them.
Speaker 2 (15:15):
This is The Big Take Asia from Bloomberg News. I'm
wan Ha. This episode was produced by Young Young, Naomi
and Jessica Beck. It was edited by Patty Hirsch, Daniel
ten Kate, and Jenny Marsh. It was fact checked by
Naomi and Young, mixed by Amer Salton, and sound designed
by Jessica. Our senior producer is Naomi Shaven. Our senior
(15:35):
editor is Elizabeth Ponzo. Our executive producer is Nicole Beemster Bower.
Sage Bowman is Bloomberg's head of Podcasts. If you like
this episode, make sure to subscribe and review The Big
Take Asia wherever you listen to podcasts, It really helps
people find the show. Thanks for listening, See you next time.
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