In China, the deterioration of the health situation is weighing heavily on the economy and on the performance of the e-commerce giant Ali Baba. The group founded by Jack Ma announced this Thursday a profit down nearly 60% in 2021 and heavy quarterly losses.
The cause of these poor figures is first of all the general economic situation, the maintenance of anti-Covid restrictions by the Chinese authorities and unemployment which is reaching record highs. All this is causing a slowdown in consumption, the engine of the Chinese economy. It’s been at its lowest for two years. The context linked to the persistence of the epidemic is so uncertain that the group says it is unable to set itself objectives for 2022.
Moreover, Ali Baba was Beijing’s first target in its regulatory shift aimed at reducing the importance of digital giants, particularly in the finance sector. The authorities prevented the IPO of its subsidiary Ant Group. Since then, mystery continues to surround the fate of its founder, Billionaire Jack Ma, disappeared from radar screens. Rumors about his alleged arrest in early May, since denied, had concrete repercussions on the stock market. The action had unscrewed, losing according to Bloomberg 26 billion dollars.
Small consolation, Ali Baba is not the only group to see its finances deteriorate. Undergoing the same economic context, the internet giant Tencent saw its turnover stagnate. A first in its history.