Jack Ma, founder of the Alibaba Group, performs at the company's 20th-anniversary celebration in Hangzhou in eastern China's Zhejiang province on Sept. 10, 2019.The Associated Press
Michael Bociurkiw is a global affairs analyst and a former reporter for the South China Sunday Morning Post.
By any standard, Jack Ma’s rise as one of China’s most successful technology tycoons is a trajectory that any government would proudly spin as a rags to riches story.
The native of Hangzhou overcame a string of early failures to build an e-commerce company that now has more than 100,000 employees and a market value of around US$460-billion. It has also expanded into artificial intelligence, cloud computing and financial services. The former teacher is believed to be worth about US$40-billion.
Mr. Ma, who resigned last week as the head of his Alibaba Group at the age of 55, is the product of an economy, though centrally organized, that produces more billionaires than anywhere else on Earth.
But as in Russia, success can bring unwelcome scrutiny from the ruling Communist Party and it may be that his departure has to do with a well-honed sense of timing that foresees state intervention – or worse – a European and U.S.-led investigation into Alibaba’s co-operation with the Chinese government, according to a controversial Chinese billionaire in exile quoted in the Chinese-language Apple Daily.
Indeed, in 2016, China’s richest man told a group of rural teachers: “I think among the richest men in China, few have good endings.”
This is not to say that Mr. Ma will completely disappear. He will continue to have enormous influence over the company he built and his extraordinary wealth will be used to improve the state of education in China.
“I worry about education,” Mr. Ma said recently at an AI conference in China. “All the educational systems – all the things we teach our kids, the way we teach our kids – are mainly designed for the industrial period.”
Many analysts predict that Mr. Ma would be much more useful to Beijing as a friendly face, who understands how the West works, to promote China Inc. around the globe. “The world is afraid of China,” he said.
Beijing may also regard Mr. Ma as someone who should feel indebted: After all, in the early days of building out his electronic marketplace for Chinese exporters, state-run China Telecom was an early investor, giving him the equivalent of US$240,000 for a 70-per-cent stake in his China Pages.
Judging by the poor job China has done to sell its narrative around the world – whether putting forth its arguments on the China-U.S. trade war or promoting its ability to be a trusted partner in the build-out of the global 5G network – the country needs someone such as Mr. Ma to put a sheen on the country’s image.
And while Mr. Ma has stayed wisely silent on the pro-democracy protests in Hong Kong, should Beijing decide to crack down, he could be called on for “national service” – as the territory’s billionaire Pansy Ho has – to bolster a global campaign to sway international public opinion.
Early last week, according to Reuters, China’s state-owned companies were told that the Hong Kong elites are not doing enough to prop up the territory during the current crisis, and they were called upon to step up investment and assert more control of companies. Might Alibaba be pressured to send the world a positive signal on Hong Kong and reconsider its delay of a US$15-billion listing in the city? Beijing would not want to see a failed listing and could support potentially the biggest equity deal of 2019 by quietly buying up shares.
Under Mr. Ma, Alibaba purchased Hong Kong’s influential English-language daily, the South China Morning Post, and since the acquisition in 2016, some China watchers say it has adopted a much softer line on Beijing. While the newspaper has aggressively covered the Hong Kong protests, its proprietor could face pressure to help cool the crisis and stabilize financial markets.
Patriotic Chinese business elites will also be needed to help prop up the Chinese economy. In the second quarter of 2019, GDP growth slumped to 6.2 per cent year-on-year – its slowest since record-keeping began 27 years ago.
In his resignation letter, Mr. Ma said Alibaba has a duty to stimulate China’s domestic demand and participation in globalization. “If China’s domestic demand is not well, Alibaba is responsible.”
With trade friction with the United States continuing to frustrate confidence, the pledge by Alibaba to encourage the economy is seen as a welcome initiative in Beijing.
One thing is for certain: While Mr. Ma may have found it relatively easy to step down from the leadership of Alibaba, he could find escaping national service a much more difficult task.