China's 6 Major Big Tech Companies Donate 30 Trillion Won to Authorities Over One Year

[Image source=AP Yonhap News]

[Asia Economy Reporter Cho Hyun-ui] It has been revealed that six major Chinese big tech companies, including Alibaba and Tencent, have donated 30 trillion won to authorities over the past year.

On the 23rd, Hong Kong Ming Pao reported, "According to our own analysis, six companies?Alibaba, Tencent, ByteDance, Pinduoduo, Meituan, and Xiaomi?have donated a total of 200 billion Hong Kong dollars (approximately 30 trillion won)."

On the 17th, President Xi Jinping emphasized a new goal called "common prosperity." President Xi explained, "Common prosperity is an essential requirement of socialism and an important characteristic of Chinese-style modernization."

Some expect that following the common prosperity policy, follow-up measures related to taxes such as increased taxes on the wealthy and capital gains tax will be introduced. In particular, it is predicted that the IT industry, which has rapidly grown with full support from the authorities, will be affected.

In fact, Tencent announced it would donate 100 billion yuan (about 18 trillion won) just one day after President Xi presented the new goal.

Ming Pao stated, "Some scholars refer to the nature of these donations as 'protection money.' Big tech companies cannot avoid paying it, but paying it does not exempt them from government supervision." It added, "Despite these donations, investors were not reassured, and major tech companies lost more than 4 trillion yuan (about 720 trillion won) in market capitalization this year."

However, it appears that big tech companies had been making donations even before the announcement of the common prosperity policy. Although IT companies are scrambling to donate amid government crackdowns, the ongoing high-intensity regulations are insufficient to ease investors' concerns.

Ming Pao reported, "In addition to generous donations, big tech companies have started to avoid public attention by having founders step down from chairman positions or cease social media activities."

This content was produced with the assistance of AI translation services.