The Straits Times
China tech giants lost their swagger and may never get it back
Published 1 Hour Ago
HONG KONG (BLOOMBERG) – On trading floors in New York and Hong Kong, the brightening mood towards Chinese technology companies is unmistakable: With stocks such as Alibaba Group Holding and Tencent Holdings surging from multi-year lows, talk of a new bull market is growing louder.
Yet speak to executives, entrepreneurs and venture capital investors intimately involved in China’s tech sector and a more downbeat picture emerges. Interviews with more than a dozen industry players suggest the outlook is still far from rosy, despite signs that the Communist Party’s crackdown on big tech is softening at the edges.
These insiders describe an ongoing sense of paranoia and paralysis, along with an unsettling realisation that the sky-high growth rates of the past two decades are likely never coming back.
Alibaba and Tencent are expected to deliver single-digit revenue growth in 2022, a letdown after years of rip-roaring expansion. One prominent start-up founder said he would pass on money from those companies because of the attention it would attract. Another said his company is proceeding on the assumption that it is only a matter of time before officials double down again.