?????? Is Xi Jinping threatening Chinese capitalism?

At the end of 2020 the storm broke.

The halting of the IPO of Ant Financial, the financial arm of Alibaba, was the starting point for a whole?new political campaign.?

Since then,?Chinese regulators have taken more than 50 actions?related to competition, finance, data or excessive profits of?large private Chinese companies, particularly big tech.?While also pushing through?tons of new regulations.?

We are talking about a scenario that has caused these companies to experience a severe hammering in the financial markets while at the same time all the alarms have gone off among investors, politicians and businessmen around the world:?

Is Xi Jinping backtracking on the process of opening up and reform that China has been undergoing since 1978??This is what the well-known investor, George Soros, believes:?

"Xi views all Chinese companies as instruments of a one-party state. Investors who got carried away by the Chinese rally are in for a rude awakening."?– George Soros?

And, take note, because there are plenty of reasons to be concerned. For example, on 29 August, the country's mainstream media published an article by Li Guangman, a well-known Chinese communist activist, entitled:?"Everyone can feel that a profound transformation is underway!”?

In the article Li made such radical statements as?"China's capital markets will no longer be a paradise for get-rich-quick capitalists". Evidently the media in China is not free but dependent on the government. That is why the publication of such a controversial and market-hostile article came as a surprise to many analysts and experts. ?

It must be said, however, that shortly thereafter, Hu Xijin, editor-in-chief of the Global Times, a state-run newspaper, published a counter-reply accusing Li Guangman of exaggerating and being inaccurate about the government's intentions. Hu Xijin is generally considered to be a mouthpiece of the Xi administration.?

In any case, Li's article was not an isolated case, but adds to a current of?denunciation of the alleged unbridled capitalism of many Chinese companies?that Xi Jinping himself has referred to on several occasions. In fact, the Chinese leader has put the idea of?"common prosperity" on the table?as an alternative to the era of excessive profits of the country's large private companies.?

Why is it important??

According to the limits set by Deng Xiaoping,?Xi Jinping would be obliged to leave power in 2022. However, everything suggests that the current Chinese leader?is in no mood?to relinquish power. Precisely for this reason, in order to break the established limits, he has to be able to invalidate any source of dissidence or influence that does not support him or that puts his re-election at risk.?

If we add to this the increasingly tense confrontation with the United States or the progressive economic slowdown that the country is experiencing, everything suggests that Xi Jinping intends to make the "Common Prosperity" campaign his new populist political banner. The problem is that if "Common Prosperity" means setting limits and punishing Chinese private companies – which are the real heart of national productivity –?the Chinese leader could be putting at risk the country's economic development and with it the political stability of the entire world. It would be better for everyone's sake if the waters were soon to return to their proper course.?

Highlights: On 9 September at the behest of Joe Biden, the presidents of the United States and China held their first telephone conversation in six months. The two leaders spoke for 90 minutes and agreed to manage the growing rivalry and regain avenues of coordination and understanding in various fields. Given China's current trajectory, a relaxing of the geopolitical tension between the two great powers would be great news for everyone.?