Xi Jinping Embraces Tech Giants and AI in Bid to Boost China's Economy

Is Xi's sudden embrace of business for real? China is left guessing

Xi Jinping's recent symposium with top entrepreneurs came amidst China's economic challenges. The discussion highlighted the private sector's potential to boost the economy and Xi's conditional support, while concerns linger about government interference stifling innovation and competition. A new focus on AI, spearheaded by DeepSeek, brings cautious optimism.When Xi Jinping, China's leader, made his entrance at a symposium with a group of top entrepreneurs this past week, he seemed to be in good spirits. China has had a few good weeks. Artificial intelligence models by the startup DeepSeek sent U.S. stocks tumbling and Western commentators screaming, "Sputnik moment." Then an animated film based on Chinese mythology raked in nearly $2 billion. Xi signaled that he stood behind the private sector at the meeting on Monday, pushing the Hong Kong stock market to its highest point in three years. For China, it all provided a respite from two years of malaise -- chronic economic problems and challenging geopolitics. What remained unclear is how much of a lasting boost China's economy could get from the ingenuity of one startup, or how much confidence the business community could derive from the sudden friendliness of a leader who has a reputation for distrusting and disliking the private sector. Interpretations of the meeting varied widely. "Is China," one social media commenter asked, "now like Shanghai in 1949," after which the private sector was nationalized under Communist Party rule? "Or is it Shenzhen in 1979," when China started the policies of reforming and opening up its economy? "No one knows," was the response from another commenter, who added that many of the senior leaders in attendance probably didn't know, either. Both the lack of confidence and the desire to start anew are real, highlighting the country's eagerness to get out of its slump and its uncertainty about its leader's readiness to change course. The private sector also has good reasons to worry that Beijing could meddle more in businesses in the name of supporting them, suffocating innovation and competition. Xi summoned the meeting because he saw that the impact of DeepSeek, a mostly unknown startup until last month, was much stronger than what he tried to achieve through a top-down approach, said Xu Chenggang, an economist at Stanford. "He wanted the private enterprises to help him find a way out of trouble," he said. Xu, who is critical of Xi's leadership and was among the first to point out China's deflationary pressures, said that DeepSeek's arrival and other positive news could bolster investors' confidence, and that any persistent momentum could support the economy. "I don't think the trend of economic decline will change," he said. "However, China might be able to escape a serious crisis that started a year ago and shift to a steadier, yet sustained, decline, giving it a chance to catch its breath." He said he also did not believe that DeepSeek or AI could fix the root of China's economic woes: weak demand. If anything, it could boost supply by making businesses more efficient, worsening the imbalance. Xi has high hopes for private enterprises and entrepreneurs. During the symposium, he told them that they should "firmly position themselves as builders of socialism with Chinese characteristics and promoters of Chinese modernization." Xi urged them to pursue high-quality development and enhance independent innovation. In a nearly 10-minute segment about the symposium on state television, China's most prominent entrepreneurs, mostly in tech and advanced manufacturing, stood respectfully and clapped vigorously as Xi walked in. After the meeting, they lined up to shake hands with him. A couple of the founders wore what's called the "Xi jacket" -- a dark, zippered windbreaker that the Chinese leader often wears and that has become the unofficial uniform of Chinese officialdom. As Xi spoke, many of the executives, seated before him like university students, were shown on the segment taking notes. Among them was Jack Ma, the founder of e-commerce giant Alibaba and the online financial behemoth Ant Group, who was the first target of a crackdown on tech that Xi carried out during the pandemic. "The meeting felt like a teacher lecturing students," a venture capitalist who invested in some of China's most successful tech startups said in an interview. "The market reaction surprised me -- it was overly optimistic." The private sector contributes more than 50% of China's fiscal revenue, more than 60% of its economic output, more than 80% of urban employment and more than 90% of the total number of enterprises, according to the state broadcaster. A businessperson who employs thousands of people in China said in an interview that it was in the party's interest to treat entrepreneurs better. "If the private sector collapses, China's economy will be gone," he said. At the meeting, Xi talked, as he often does, about his experience working in provinces where the private companies were highly competitive. But his economic thinking can be summed up as: bigger role for the state, and smaller role for the market. Under his rule, China pulled back from pro-business policies that transformed it into the world's No. 2 economy. It smothered its most successful tech companies, sending accomplished entrepreneurs to early retirement or self-imposed exile. Now as the country's economy struggles and artificial intelligence demonstrates its sway in China's most important geopolitical rivalry, with the United States, Xi has been showing some warmth toward the private sector. A founder of a publicly listed company said that he believed the Communist Party, which does not allow any force to rival it for power, would always be wary of the private sector. A lawyer specializing in mergers and acquisitions said that he did not see signs of economic recovery as he walked through Shanghai. But he said that it was good that people were talking about the successes of DeepSeek and "Ne Zha 2," the animated blockbuster. Some investors are hoping that the government will announce more substantial policies during the annual parliamentary sessions in March, he said. The lawyer, like the other businesspeople interviewed, asked not to be named for fear of retaliation for speaking publicly. China's state media and government have heralded DeepSeek's and AI's potential to boost economic growth. In the past few weeks, China's three major telecom operators, the state utility and major oil companies, as well as tech giants including Tencent and Baidu, have announced partnerships with DeepSeek. Some provinces have said they will integrate DeepSeek's models into their government service systems. While these deals were good news for DeepSeek and could improve the productivity of these institutions, they could come at the expense of other artificial intelligence companies. "DeepSeek's real impact is the destruction of other Chinese AI language models," Jielin Dong, a researcher of China's tech industry, wrote on X, "as all resources are flowing toward DeepSeek, making it difficult for others to secure funding and market opportunities." A founder of an AI startup said DeepSeek was significant for China but agreed with Dong's assessment that it would divert funding. The venture capitalist who believed that the market was overly optimistic expressed concern that too much government attention could hurt DeepSeek. The company's founder, Liang Wenfeng, who attended the symposium with Xi, is now spending time attending political meetings and pleasing officials high and low, the venture capitalist said. But that's a fate DeepSeek and other successful private enterprises might not be able to avoid. After the symposium, a video skit on WeChat showed a conversation between a civil servant and a businessman in the Ming dynasty. "How exactly should we manage things to bring some life into the market?" the mandarin asked. "Just leave it alone," the businessman replied. The video has since been deleted. This article originally appeared in The New York Times.

Xi Jinping seizes DeepSeek moment to restore China tech chiefs to spotlight

In a meeting with leading entrepreneurs this week, China's President Xi Jinping celebrated a rising tech industry star while rehabilitating a once-venerated tycoon as he sought to restore investor confidence in the country's struggling economy. State media on Monday showed the Chinese president warmly greeting Liang Wenfeng, the youthful chief of artificial intelligence start-up DeepSeek, and shaking hands with Jack Ma, the Alibaba founder who fell from favour after criticising regulators in 2020. In one step, Xi sought to reassure established figures whose tech groups powered China's recent economic rise -- some of whom have been personally targeted by government crackdowns -- even as he signalled a new era for the private sector following Deepseek's dramatic emergence this year as a rival to western AI companies. The meeting showed how quickly "political winds" can change for Chinese business, said Han Shen Lin, China country director for US consultancy The Asia Group. "It was only a few years ago that the same sector was under a regulatory chokehold," said Lin. "Now suddenly they're the favoured son again." The meeting on Monday was Xi's first high-profile encounter with private entrepreneurs in several years. He took pains to emphasise the entrepreneurs' importance to China's economic strength, referring to the "two unshakeable principles" -- meaning that both the public and private sector should be supported. But he also reiterated the ruling Chinese Communist party's control over business, stressing that companies should be "ambitious in serving the country". "It's a recognition that the dynamism of the private sector matters, it adds strength to the Chinese economy and to the Chinese state's capacity," said Manoj Kewalramani, author of a newsletter that provides daily interpretations of the CCP's flagship People's Daily newspaper. Kewalramani said Xi was conveying to business leaders that "you are valuable players -- but . . . in the grand scheme of things, you are not there just to serve your own needs". Most of the attendees were involved in advanced industries, such as electric vehicles and batteries, robots and other electronic hardware sectors, underlining Xi's strategy of elevating China's manufacturing value chain as it competes with the US for tech supremacy. Aside from Ma and Liang, the attendees included Robin Zeng, chair of leading battery maker CATL, Unitree robots' founder Wang Xingxing and Wang Chuanfu, chair of electric vehicle maker BYD. "Xi wants to have a conversation with the CEOs who are going places, pushing their industries forward," said Rupert Hoogewerf, whose research company Hurun Report has chronicled the rise of China's top entrepreneurs. "This is the new guard that Beijing wants to encourage," he added. Chen Long, founder of research group Plenum, said the timing indicated that Xi's administration was looking to harness the positive momentum in business and investor confidence following the launch of DeepSeek's groundbreaking AI model, which "showed China could innovate". "Now, this meeting removes policy risk for private business which some investors were still worried about," Chen said. Encouraging private sector investment is critical for Xi to revitalise the economy, which has been beset by slowing growth in the wake of a years-long property sector bubble. Government data shows that public sector spending in recent years has driven fixed asset investment growth, which measures spending on infrastructure, property and equipment. Private investment, by contrast, has pulled back, contracting 0.1 per cent in 2024 from the previous year, following a 0.4 per cent decline in 2023, reflecting caution among business. But Chen said the economy was gradually pivoting towards Xi's priorities of advanced tech and high-end manufacturing. "It's a structural transition," he said. Lin of The Asia Group stressed that Xi's message was crucially to "incentivise innovation in service of the state, not for its own sake", with the private sector ultimately serving the party's strategic goals. The Chinese leader urged the business leaders present at Monday's meeting to "actively fulfil social responsibilities" and "promote common prosperity". The latter term -- which experts say decries excessive wealth -- was invoked to justify Xi's crackdown on the tech sector, which began with the scrapping of the IPO of Ma's Ant Group in late 2020 and wiped billions of dollars from the market values of leading Chinese companies. The Chinese leader promised a level playing field for private businesses this week, and the resolution of persistent challenges such as high financing costs and late payment by state bodies as well as an end to arbitrary fees, fines and inspections. But some analysts questioned whether those pledges would stimulate a broader recovery in private sector confidence in China, beyond cheering big tech companies and their investors. Xi and other party leaders have regularly sought to boost business sentiment in the past year with promises to curb mistreatment of business by cash-strapped local governments looking to raise money. But the problems, which can include detentions of executives, have persisted. A Beijing-based entrepreneur said he hoped Xi's messaging would resolve issues such as delayed payments from state-owned groups. He said a state-owned automaker had owed him almost Rmb10mn ($1.4mn) for nearly a year. "It's very difficult to pay staff without this money," he said, asking not to be named to avoid offending his state-owned partner.

Xi Jinping's new frontline corporate guard showcases his priorities, control

President Xi Jinping has shifted focus towards private sector giants such as BYD, Huawei, and Alibaba to boost China's technological self-reliance amidst the ongoing technology war with the U.S. This move highlights a significant change in the Chinese leadership's perception of the private sector's role in economic growth.When President Xi Jinping hosted entrepreneurs at a rare meeting in Beijing in 2018, the executives granted coveted front-row seats came from industries ranging from high-tech to energy, and few were familiar names. Fast-forward seven years and that line-up has changed markedly as Beijing buckles down to navigate a deepening technology war with the United States and celebrate powerful Chinese firms that have triumphed in the face of U.S. pressure. On Monday, Xi mobilised to the frontlines a private sector battalion that included the founders of electric car maker BYD, tech giants Huawei, Alibaba, Tencent and Xiaomi as well as AI start-up DeepSeek. The firms, most of which are giants in their sectors and controversial abroad, are key to achieving Xi's belief that "new productive forces" are needed for China to escape its middle-income trap, compete with the United States and revitalise a stubbornly sluggish domestic economy, analysts said. "The line-up of entrepreneurs suggests that Xi's priority for the private sector is for it to support his goals of achieving technological self-reliance and supply-chain security," said Neil Thomas, a fellow on Chinese politics at the Asia Society Policy Institute's Center for China Analysis. Indeed, the global and domestic backdrop for this week's meeting stood in stark contrast to the situation in 2018, when growth was still robust and the geopolitical landscape had not deteriorated to the present point, despite a trade war with U.S. President Donald Trump during his first term. By contrast, the symposium held that year drafted companies from across industries that included many smaller firms, such as software engineering firm Neusoft and car parts manufacturer Wanxiang. Tencent and Baidu attended, according to local media, but were not given front-row seats. "The mentality of the Chinese leadership has changed," said Alfredo Montufar-Helu, head of The Conference Board's China Center, a think tank. "It's a hard pill for them to swallow, but compared to 2018 they are now recognising that these Chinese tech companies' contribution to economic growth is greater than they previously believed," Montufar-Helu said. In the highly choreographed meeting, Xi urged the tycoons to "show their talent" and be confident in the power of China's model and market, while ensuring that private companies could compete on equal terms with state-owned companies. "The new line-up of entrepreneurs that Xi met with represent the cutting-edge technology that Beijing wants to see succeed to drive new economic growth," said Paul Triolo, partner and technology policy lead for DGA-Albright Stonebridge Group. Beijing has been focusing more on the private sector in recent months amid efforts to revive a struggling economy weighed down by a years-long property market slump and sluggish consumer spending. The tech champions at Monday's meeting suggest that Xi is rallying troops from the business sector to fight a geopolitical battle rather than to signal a strategic structural shift in the way Beijing manages the economy. "It's a recognition from the Party leadership that despite their preference for a state-centric approach to the economy, private companies can play a major role in the realization of China's strategic priorities, including vis-a-vis the building of technological self-reliance," Montufar-Helu said. "And the Party intends to leverage this to innovate itself free from export controls and tech restrictions." The seating of executives at such key meetings is seen as illustrating companies' standing. Huawei's founder Ren Zhengfei and BYD's Wang Chuanfu sat opposite Xi. Alibaba's Jack Ma and Tencent's Pony Ma, among the biggest targets of Beijing's previous private sector crackdown, were also seated in the front row. Wang Xing, founder of China's largest delivery platform, Meituan, sat in the second row. The presence of Alibaba's Ma, who shook hands with Xi, was seen by many as the rehabilitation of a tech leader who largely withdrew from public life after authorities halted the IPO of his fintech company Ant Group in 2020. Another notable face was Liang Wenfeng, founder of DeepSeek, whose rapid rise has sent shockwaves through global markets since it unveiled a new AI model last month. Underscoring Xi's commitment to private enterprises, the National People's Congress Standing Committee is due to table a draft of the Private Economy Promotion Law at a meeting scheduled on February 24-25. It is expected to pass. The legislation aims to create a legal environment that ensures equal treatment and protection of private companies. "The symposium and the 'Private Economy Promotion Law' will have a positive impact on private sector confidence," said Professor Zhu Tian of the China Europe International Business School in Shanghai. "But to sustain its impact, a more forceful fiscal and monetary stimulus policy ... is also required to pull China's economy out of the current deflationary spiral." Markets have cheered the meeting as a signal that private enterprise will be treated kindly and that the crackdown on tech giants is over. However, previous disappointments are fresh in investors' minds and a brake on outright exuberance. "We think President Xi's support for innovation industries, ongoing macro policy support, operating performance, and other fundamental improvements will be crucial drivers of the China tech sector's outperformance against the broader market from here," analysts at UBS Wealth Management said in a note to clients. Hong Kong's Hang Seng tech index touched a three-year peak on Tuesday. Shares in Alibaba rose 2% after CCTV showed Xi shaking hands with founder Jack Ma.

Xi's new frontline corporate guard showcases his priorities, control

BEIJING/SHANGHAI (Reuters) - When President Xi Jinping hosted entrepreneurs at a rare meeting in Beijing in 2018, the executives granted coveted front-row seats came from industries ranging from high-tech to energy, and few were familiar names. Fast-forward seven years and that line-up has changed markedly as Beijing buckles down to navigate a deepening technology war with the United States and celebrate powerful Chinese firms that have triumphed in the face of U.S. pressure. On Monday, Xi mobilised to the frontlines a private sector battalion that included the founders of electric car maker BYD, tech giants Huawei, Alibaba, Tencent and Xiaomi as well as AI start-up DeepSeek. The firms, most of which are giants in their sectors and controversial abroad, are key to achieving Xi's belief that "new productive forces" are needed for China to escape its middle-income trap, compete with the United States and revitalise a stubbornly sluggish domestic economy, analysts said. "The line-up of entrepreneurs suggests that Xi's priority for the private sector is for it to support his goals of achieving technological self-reliance and supply-chain security," said Neil Thomas, a fellow on Chinese politics at the Asia Society Policy Institute's Center for China Analysis. Indeed, the global and domestic backdrop for this week's meeting stood in stark contrast to the situation in 2018, when growth was still robust and the geopolitical landscape had not deteriorated to the present point, despite a trade war with U.S. President Donald Trump during his first term. By contrast, the symposium held that year drafted companies from across industries that included many smaller firms, such as software engineering firm Neusoft and car parts manufacturer Wanxiang. Tencent and Baidu attended, according to local media, but were not given front-row seats. "The mentality of the Chinese leadership has changed," said Alfredo Montufar-Helu, head of The Conference Board's China Center, a think tank. "It's a hard pill for them to swallow, but compared to 2018 they are now recognising that these Chinese tech companies' contribution to economic growth is greater than they previously believed," Montufar-Helu said. In the highly choreographed meeting, Xi urged the tycoons to "show their talent" and be confident in the power of China's model and market, while ensuring that private companies could compete on equal terms with state-owned companies. "The new line-up of entrepreneurs that Xi met with represent the cutting-edge technology that Beijing wants to see succeed to drive new economic growth," said Paul Triolo, partner and technology policy lead for DGA-Albright Stonebridge Group. SEATING PRIORITIES Beijing has been focusing more on the private sector in recent months amid efforts to revive a struggling economy weighed down by a years-long property market slump and sluggish consumer spending. The tech champions at Monday's meeting suggest that Xi is rallying troops from the business sector to fight a geopolitical battle rather than to signal a strategic structural shift in the way Beijing manages the economy. "It's a recognition from the Party leadership that despite their preference for a state-centric approach to the economy, private companies can play a major role in the realization of China's strategic priorities, including vis-a-vis the building of technological self-reliance," Montufar-Helu said. "And the Party intends to leverage this to innovate itself free from export controls and tech restrictions." The seating of executives at such key meetings is seen as illustrating companies' standing. Huawei's founder Ren Zhengfei and BYD's Wang Chuanfu sat opposite Xi. Alibaba's Jack Ma and Tencent's Pony Ma, among the biggest targets of Beijing's previous private sector crackdown, were also seated in the front row. Wang Xing, founder of China's largest delivery platform, Meituan, sat in the second row. The presence of Alibaba's Ma, who shook hands with Xi, was seen by many as the rehabilitation of a tech leader who largely withdrew from public life after authorities halted the IPO of his fintech company Ant Group in 2020. Another notable face was Liang Wenfeng, founder of DeepSeek, whose rapid rise has sent shockwaves through global markets since it unveiled a new AI model last month. Underscoring Xi's commitment to private enterprises, the National People's Congress Standing Committee is due to table a draft of the Private Economy Promotion Law at a meeting scheduled on February 24-25. It is expected to pass. The legislation aims to create a legal environment that ensures equal treatment and protection of private companies. "The symposium and the 'Private Economy Promotion Law' will have a positive impact on private sector confidence," said Professor Zhu Tian of the China Europe International Business School in Shanghai. "But to sustain its impact, a more forceful fiscal and monetary stimulus policy ... is also required to pull China's economy out of the current deflationary spiral." Markets have cheered the meeting as a signal that private enterprise will be treated kindly and that the crackdown on tech giants is over. However, previous disappointments are fresh in investors' minds and a brake on outright exuberance. "We think President Xi's support for innovation industries, ongoing macro policy support, operating performance, and other fundamental improvements will be crucial drivers of the China tech sector's outperformance against the broader market from here," analysts at UBS Wealth Management said in a note to clients. Hong Kong's Hang Seng tech index touched a three-year peak on Tuesday. Shares in Alibaba rose 2% after CCTV showed Xi shaking hands with founder Jack Ma. (Reporting by Eduardo Baptisa and Liam Mo in Beijing, Brenda Goh in Shangai, Rae Wee and Tom Westbrook in Singapore, and Casey Call in Shanghai; Writing by By Anne Marie Roantree. Editing by Gerry Doyle)

China's Xi meets with business leaders amid economic, geopolitical headwinds

China's President Xi Jinping attends a meeting with Brazil's President Luiz Inacio Lula da Silva in Brasilia, Brazil, Nov. 20, 2024. Reuters-Yonhap Chinese President Xi Jinping on Monday spoke at a symposium was attended by business leaders including Alibaba co-founder Jack Ma, state media reported, as Beijing grapples with a slowing economy and growing tensions with the U.S. Other private business leaders who attended the symposium included Huawei founder Ren Zhengfei, Xiaomi's Lei Jun, BYD's Wang Chuanfu, Unitree's Wang Xingxing, and CATL's Robin Zeng, a video published by CCTV showed. Meituan's Wang Xing, China Feihe's Leng Youbin and Will Semiconductor founder Yu Renrong also attended, the video showed. Tencent's Pony Ma was also there, a source familiar with the matter said, declining to be named as the meeting details were not public. Tencent did not immediately respond to a request for comment. Xi delivered a speech after listening to representatives of private companies, official news agency Xinhua said. The report did not provide any details about the symposium, held in the Great Hall of the People in Beijing. Reuters reported on Friday, citing sources, Xi planned to chair a symposium to boost private sector sentiment on Monday that would be attended by the country's business leaders, including Alibaba co-founder Jack Ma. The symposium would be aimed at boosting private-sector sentiment, and Xi was expected to encourage company chiefs to expand their businesses domestically and internationally amid an intensifying China-U.S. technology war, the sources had said. The symposium also comes as DeepSeek's AI platform has triggered investor speculation about its potential to buoy China's broader tech sector, leading to calls for an upward repricing of Chinese assets. The Deepseek logo, a keyboard, and robot hands are seen in this illustration taken Jan. 27. Reuters-Yonhap Xi has long stressed the need for China to achieve self-sufficiency in semiconductors and wants the country to use AI to drive economic development. But China's efforts have been hampered by export control measures on chips imposed by Washington which is worried Beijing could use advanced semiconductors to boost its military capabilities. "It's a tacit acknowledgement that the Chinese government needs private-sector firms for its tech rivalry with the U.S.," said Christopher Beddor, deputy China research director at Gavekal Dragonomics in Hong Kong. "The government has no choice but to support them if it wants to compete with the U.S." Tech shares in Hong Kong have roared higher in recent weeks on a combination of optimism about the DeepSeek AI breakthrough and a thawing of authorities' approach to internet giants. The Hang Seng technology index hit a three-year high in morning trade on Monday, having rallied on Friday after Reuters reported Xi was to chair Monday's symposium. It slipped in volatile afternoon trade and was last down 1.3 percent. Xi first chaired a high-profile symposium for the private sector in 2018, six years after he came to power. At the time, he pledged tax cuts and a level playing field while reaffirming that private firms would have access to financial backing. "Despite the rising opportunities in the case of DeepSeek, it is also about guiding the private sector in the government-led direction and containing the potential risks to compete with the U.S.," said Gary Ng, senior economist at Natixis. "Still, the regulatory environment is the black box. As most AI development happens in the private sector, we cannot entirely rule out the outcome of a tighter-than-market-expected regulatory environment than we see now." (Reuters)

Analysis-Xi's New Frontline Corporate Guard Showcases His Priorities, Control

BEIJING/SHANGHAI (Reuters) - When President Xi Jinping hosted entrepreneurs at a rare meeting in Beijing in 2018, the executives granted coveted front-row seats came from industries ranging from high-tech to energy, and few were familiar names. Fast-forward seven years and that line-up has changed markedly as Beijing buckles down to navigate a deepening technology war with the United States and celebrate powerful Chinese firms that have triumphed in the face of U.S. pressure. On Monday, Xi mobilised to the frontlines a private sector battalion that included the founders of electric car maker BYD, tech giants Huawei, Alibaba, Tencent and Xiaomi as well as AI start-up DeepSeek. The firms, most of which are giants in their sectors and controversial abroad, are key to achieving Xi's belief that "new productive forces" are needed for China to escape its middle-income trap, compete with the United States and revitalise a stubbornly sluggish domestic economy, analysts said. "The line-up of entrepreneurs suggests that Xi's priority for the private sector is for it to support his goals of achieving technological self-reliance and supply-chain security," said Neil Thomas, a fellow on Chinese politics at the Asia Society Policy Institute's Center for China Analysis. Indeed, the global and domestic backdrop for this week's meeting stood in stark contrast to the situation in 2018, when growth was still robust and the geopolitical landscape had not deteriorated to the present point, despite a trade war with U.S. President Donald Trump during his first term. By contrast, the symposium held that year drafted companies from across industries that included many smaller firms, such as software engineering firm Neusoft and car parts manufacturer Wanxiang. Tencent and Baidu attended, according to local media, but were not given front-row seats. "The mentality of the Chinese leadership has changed," said Alfredo Montufar-Helu, head of The Conference Board's China Center, a think tank. "It's a hard pill for them to swallow, but compared to 2018 they are now recognising that these Chinese tech companies' contribution to economic growth is greater than they previously believed," Montufar-Helu said. In the highly choreographed meeting, Xi urged the tycoons to "show their talent" and be confident in the power of China's model and market, while ensuring that private companies could compete on equal terms with state-owned companies. "The new line-up of entrepreneurs that Xi met with represent the cutting-edge technology that Beijing wants to see succeed to drive new economic growth," said Paul Triolo, partner and technology policy lead for DGA-Albright Stonebridge Group. SEATING PRIORITIES Beijing has been focusing more on the private sector in recent months amid efforts to revive a struggling economy weighed down by a years-long property market slump and sluggish consumer spending. The tech champions at Monday's meeting suggest that Xi is rallying troops from the business sector to fight a geopolitical battle rather than to signal a strategic structural shift in the way Beijing manages the economy. "It's a recognition from the Party leadership that despite their preference for a state-centric approach to the economy, private companies can play a major role in the realization of China's strategic priorities, including vis-a-vis the building of technological self-reliance," Montufar-Helu said. "And the Party intends to leverage this to innovate itself free from export controls and tech restrictions." The seating of executives at such key meetings is seen as illustrating companies' standing. Huawei's founder Ren Zhengfei and BYD's Wang Chuanfu sat opposite Xi. Alibaba's Jack Ma and Tencent's Pony Ma, among the biggest targets of Beijing's previous private sector crackdown, were also seated in the front row. Wang Xing, founder of China's largest delivery platform, Meituan, sat in the second row. The presence of Alibaba's Ma, who shook hands with Xi, was seen by many as the rehabilitation of a tech leader who largely withdrew from public life after authorities halted the IPO of his fintech company Ant Group in 2020. Another notable face was Liang Wenfeng, founder of DeepSeek, whose rapid rise has sent shockwaves through global markets since it unveiled a new AI model last month. Underscoring Xi's commitment to private enterprises, the National People's Congress Standing Committee is due to table a draft of the Private Economy Promotion Law at a meeting scheduled on February 24-25. It is expected to pass. The legislation aims to create a legal environment that ensures equal treatment and protection of private companies. "The symposium and the 'Private Economy Promotion Law' will have a positive impact on private sector confidence," said Professor Zhu Tian of the China Europe International Business School in Shanghai. "But to sustain its impact, a more forceful fiscal and monetary stimulus policy ... is also required to pull China's economy out of the current deflationary spiral." Markets have cheered the meeting as a signal that private enterprise will be treated kindly and that the crackdown on tech giants is over. However, previous disappointments are fresh in investors' minds and a brake on outright exuberance. "We think President Xi's support for innovation industries, ongoing macro policy support, operating performance, and other fundamental improvements will be crucial drivers of the China tech sector's outperformance against the broader market from here," analysts at UBS Wealth Management said in a note to clients. Hong Kong's Hang Seng tech index touched a three-year peak on Tuesday. Shares in Alibaba rose 2% after CCTV showed Xi shaking hands with founder Jack Ma. (Reporting by Eduardo Baptisa and Liam Mo in Beijing, Brenda Goh in Shangai, Rae Wee and Tom Westbrook in Singapore, and Casey Call in Shanghai; Writing by By Anne Marie Roantree. Editing by Gerry Doyle)

China's Xi Jinping attends symposium on private enterprises

President Xi Jinping attended a symposium for private enterprises where top Chinese tech entrepreneurs, including Alibaba's Jack Ma and Tencent's Pony Ma, were expected. The meeting aimed to boost private-sector sentiment and encourage expansion amidst the China-US technology war. Specific details were not disclosed by Xinhua, according to Reuters sources.China's President Xi Jinping has attended a symposium on private enterprises, official news agency Xinhua said on Monday, a rare move that comes as Beijing grapples with a slowing economy and growing tensions with the United States. The Xinhua report said Xi delivered a speech after listening to representatives of private companies. The report did not provide any details about the symposium, held in the Great Hall of the People in Beijing, including who the attendees were from private enterprises. Reuters reported on Friday, citing sources, Xi planned to chair a symposium to boost private sector sentiment on Monday that would be attended by the country's business leaders, including Alibaba cofounder Jack Ma. The symposium would be aimed at boosting private-sector sentiment, and Xi was expected to encourage company chiefs to expand their businesses domestically and internationally amid an intensifying China-US technology war, the sources had said. Xi first chaired a high-profile symposium for the private sector in 2018, six years after he came to power. At the time, he pledged tax cuts and a level playing field while reaffirming that private firms would have access to financial backing. The symposium also comes as DeepSeek's AI platform has triggered investor speculation about its potential to buoy China's broader tech sector, leading to calls for an upward repricing of Chinese assets. Xi has long stressed the need for China to achieve self-sufficiency in semiconductors and wants the country to use AI to drive economic development. But China's efforts have been hampered by export control measures on chips imposed by Washington which is worried Beijing could use advanced semiconductors to boost its military capabilities. "It's a tacit acknowledgement that the Chinese government needs private-sector firms for its tech rivalry with the US," said Christopher Beddor, deputy China research director at Gavekal Dragonomics in Hong Kong. "The government has no choice but to support them if it wants to compete with the US" Tech shares in Hong Kong have roared higher in recent weeks on a combination of optimism about the DeepSeek AI breakthrough and a thawing of authorities' approach to internet giants. The index hit a three-year high in morning trade on Monday, having rallied on Friday after Reuters reported Xi was to chair Monday's symposium. It was broadly steady shortly after state media reports on his speech on Monday.

China's Xi holds rare meeting with business leaders amid slowing economy, US tensions

Chinese President Xi Jinping on Monday spoke at a symposium attended by business leaders including Alibaba co-founder Jack Ma, state media reported, as Beijing grapples with a slowing economy and growing tensions with the U.S. Other private business leaders who attended the symposium included Huawei founder Ren Zhengfei, Xiaomi's Lei Jun, BYD's Wang Chuanfu, Unitree's Wang Xingxing, and CATL's Robin Zeng, a video published by CCTV showed. Meituan's Wang Xing, China Feihe's Leng Youbin and Will Semiconductor founder Yu Renrong also attended, the video showed. Tencent's Pony Ma was also there, a source familiar with the matter said, declining to be named as the meeting details were not public. Tencent did not immediately respond to a request for comment. Xi delivered a speech after listening to representatives of private companies, official news agency Xinhua said. The report did not provide any details about the symposium, held in the Great Hall of the People in Beijing. Reuters reported on Friday, citing sources, Xi planned to chair a symposium to boost private sector sentiment on Monday that would be attended by the country's business leaders, including Alibaba's Jack Ma. The symposium would be aimed at boosting private-sector sentiment, and Xi was expected to encourage company chiefs to expand their businesses domestically and internationally amid an intensifying China-U.S. technology war, the sources had said. The symposium also comes as DeepSeek's AI platform has triggered investor speculation about its potential to buoy China's broader tech sector, leading to calls for an upward repricing of Chinese assets. Xi has long stressed the need for China to achieve self-sufficiency in semiconductors and wants the country to use AI to drive economic development. But China's efforts have been hampered by export control measures on chips imposed by Washington which is worried Beijing could use advanced semiconductors to boost its military capabilities. "It's a tacit acknowledgement that the Chinese government needs private-sector firms for its tech rivalry with the U.S.," said Christopher Beddor, deputy China research director at Gavekal Dragonomics in Hong Kong. "The government has no choice but to support them if it wants to compete with the U.S." Xi first chaired a high-profile symposium for the private sector in 2018, six years after he came to power. At the time, he pledged tax cuts and a level playing field while reaffirming that private firms would have access to financial backing. "Despite the rising opportunities in the case of DeepSeek, it is also about guiding the private sector in the government-led direction and containing the potential risks to compete with the U.S.," said Gary Ng, senior economist at Natixis. "Still, the regulatory environment is the black box. As most AI development happens in the private sector, we cannot entirely rule out the outcome of a tighter-than-market-expected regulatory environment than we see now."