Experts note that in order to understand how the cooling of relations between the United States and China are changing the landscape of international business to look closely enough to the Internet giant Alibaba (Alibaba). To date, this is the most authoritative and expensive Chinese company — its cost at $ 400 billion is impressive. The last 5 years, it also is a hybrid, encompassing both superpowers, as the firm’s shares are included in stock lists in the United States. According to the Agency Bloomberg (Bloomberg), the company is now considering the issue of its securities in the amount of $ 20 billion in Hong Kong. This process, however, takes place against the background of increasing risks of Americans take action against Chinese interests, as well as the growing impact of Hong Kong capital markets. British experts correctly noticed that the implementation of the listing in Hong Kong will mean that Chinese companies insure their risks to reduce dependence on Western Finance.
In 2014, when Alibaba was first published on the open market, the world looked quite different. Despite the fact that the firm was based in Hangzhou and 91% of its sales are in mainland China, it was decided to include the company’s shares are listed on a stock market in new York, the site of the deepest and most liquid capital markets in the world. Banks wall Street acted as the guarantors of the securities placement. Moreover, the owner of Alibaba, Jack MA, — even then he was a real star in China, high society of Manhattan was seen as an open and unchained businessman with whom Americans can do business. However, experts note that the ad MA is not an exception. Today, 174 Chinese companies, the aggregate market value of $ 394 billion, including tech giants Baidu and JI-di (JD.com), keep the main volume of its securities in the United States. Recently, the American securities market has entered a promising company Lakin coffee (Luckin Coffee), copying the business model of Starbucks (Sturbucks), which in may placed shares worth $ 4 billion.
Despite this outwardly positive picture, “Alibaba” one of the first companies suddenly realized that the United States have recently become less hospitable. In January 2018, an attempt by the financial services company Ant financial (Ant Finencial) — a subsidiary company of Alibaba to acquire its us competitor MoneyGram (MoneyGram) were blocked according to the official definition of the American side, for reasons of national security. And in November, the British experts notice, has disappeared and the halo over by Jack MA, when the Americans learned that he, like many other Chinese tycoons, is the Communist party of China. By the way, this year MA had to leave his post at Alibaba. According to “the Economist”, executives from Silicon valley are whispering about the fact that, say, a global cloud business the company is a threat to American interests.
Alibaba invests in startups, which means that its activities may be in conflict with the new law of the United States, known as FIRMA (FIRRMA), which requires to inspect all foreign procurement “technologies of special importance.” Yet, unlike Huawei (Huawei), direct threats to the activities of Alibaba yet, but even the British experts notice that the situation around the company was quite tense.
Us-China trade war covering not only tariffs, but have covered areas such as extradition, legal, venture capital and global system of payments in dollars. In this regard, experts believe is evident by the fact that Chinese listed companies become very vulnerable. If, for example, China wanted to boycott Apple (Apple) or Boeing (Boeing), the United States could respond to this “freezing” of the sale of shares of Chinese firms and creating barriers for raising capital.
Extensive, but underdeveloped capital markets in mainland China will not replace wall Street. In Hong Kong, they say, the offshore hub of China — far from perfect, and not least because of the desire of China step by step to harm the rule of law in the special administrative region. However, it has become a worthy alternative platform for Chinese multinational companies. After a review in 2018 of the exchange listing rules, Hong Kong welcomes companies with securities of two classes. In the area of expanded functions conduit through which investors from mainland China can buy shares, and global investors have access to China. Last year, the listing in Hong Kong made a profit with a volume of 34 billion dollars, which, by the way, above, that received a NASDAQ (Nasdaq) or the new York stock exchange (NYSE).
British experts correctly point out that the rise of Hong Kong in parallel with the process of the weakening of Western hegemony in the Asian financial sector. Even a decade ago, Chinese banks were at the periphery. Now the company with wall Street no longer have such a decisive weight as before. Last year, seven of the leading twenty agents, policyholders in Asia was China. Chinese banks are among the largest Asian cross-border lenders. The US still control the system of payments in dollars, however, experts believe that in the short term, there are also possible changes.
Listing in Hong Kong would allow Alibaba to raise capital and experts note the high growth in the past year sales grew 51%. In London believe that even if Chinese companies will significantly reduce their activity in the United States, new York, no doubt, will remain a thriving financial center.
In a broader understanding, the main idea is that experts from “the Economist” want to convey to readers is that complex global network of financial and commercial ties already adapted to the conditions of the escalating trade wars. So, large companies in production of equipment make adjustments to the supply chain. Retailers shift supply sources, to goods sold in USA were manufactured in China. Banks are reducing their exposure to counterparties who may fall under U.S. sanctions. Even the world’s most successful companies, such as Alibaba and feel the need to have a plan “B”. And this concept, conclude the experts, is very different from the one that Jack MA had imagined when he rung the ceremonial bell at the new York stock exchange in 2014
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