“Cut off from American capital, can Chinese companies continue to flourish under the austerity dictated by President Xi Jinping? »

Ln July 29, forty-eight hours after the publication of its 2021 annual report, Alibaba saw its shares plunge more than 11% in a single day on the New York Stock Exchange (NYSE) and for good reason: the Securities and Exchange Commission ( SEC), Wall Street’s “policeman” added it to its list of Chinese listings that violated the federal law on the responsibility of foreign companies – law Holding Foreign Companies Accountable Act (HFCAA).

If this is just one more name on the long list that now has 159 candidates for delisting for non-compliance with American auditing standards, the fall of the company founded by Jack Ma would spell the end of a period.

Clearly, celebrated as the biggest IPO in history by raising $25 billion in September 2014 (about 19.4 billion euros at the time), Alibaba harbors no illusions that it will continue. on Wall Street and is considering the worst-case scenario, because on July 27, while submitting its annual report to the SEC, it filed an application with the Hong Kong Stock Exchange for a second primary listing. Everything indicates that the group is preparing its withdrawal with fatality and that the countdown to its delisting is well underway. Without a gesture from Beijing, the American stock market will be emptied of Chinese ratings by the end of 2024.

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However, it all started as a cordial agreement between the companies of the red empire, which wanted access to the largest capital market in the world, and Wall Street, for which money has no color. For more than ten years, the so-called “capitalism with Chinese characteristics” has been praised by countless analysts disappointed with capitalism as such, and the arrival of Chinese companies has delighted Western investors whose funds have also contributed to the expansion of the champions of the second world power.

improbable honeymoon

To measure the perfect financial “coupling” of the two shores of the Pacific, it suffices to browse the list of holders of Alibaba securities on which appear the names of the largest banks, such as Goldman Sachs and HSBC, but also California Public Employees Retirement System (Calpers), the largest US public pension fund, and Ontario Teachers’ Pension Plan, the second largest institutional fund in Canada that manages the retirement of Ontario teachers, to name a few.

The improbable honeymoon could have lasted if China did not consider that the audit documents of its companies operating on foreign soil are a matter of national security and that the inspection of said documents by the American regulator constitutes a violation of the national sovereignty.

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