West shouldn’t misinterpret or overstate Beijing’s new tech regulations, ex-Google China exec says

Kai-Fu Lee, CEO of Sinovation Ventures.

Lino Mirgeler | Portray Alliance | Getty Images

The passe president of Google China warned that the West could perchance possibly peaceable be careful not to overstate or misinterpret the currently offered regulations by Beijing that like hurt the likes of Alibaba, Tencent and Didi.

Kai-Fu Lee, who now invests in Chinese launch-united states of americathrough his endeavor capital agency Sinovation Ventures, suggested CNBC Tuesday that China is merely regulating a handful of tremendous web companies to be determined their major market situation doesn’t hurt customers.

“That’s not lots assorted from what U.S. and EU like done,” stated Lee, who is currently based mostly entirely mostly in Beijing.

“There could perchance possibly peaceable not be an overinterpretation of the intent to restrict the scope of tremendous web companies … into an overreaching slowdown of the tech financial system,” Lee added. “That is more likely to be a mistaken interpretation.”

The Chinese authorities is that in point of fact “very good” on tech, Lee stated, pointing to its push on areas admire man made intelligence, semiconductors, and cloud computing.

The Taiwanese-born American computer scientist stated he expects 10 to 15 Chinese AI companies to head public in the next year and he argued that it makes sense for traders to lift stakes in companies working in industries being backed by the Chinese authorities.

“In the occasion you to come to a resolution to have that the authorities can like [the] energy to possess or ruin a company, then the authorities is doing the entirety it’s miles going to to possess these AI, semiconductor and cloud companies. So how can it be horrid to make investments in them?” he stated.

Alibaba, Tencent and Didi like seen their share costs dash in most up-to-date weeks after China offered unique guidelines on info-sharing. Lee stated there is possibly a case for “nick price hunting” because the punishments like now been handed out.

In terms of regulating technology companies, Lee stated China is device more “action-orientated” than the U.S.

“The methodology the U.S. deals with tremendous web companies is to plow by congressional hearings, judicial allure, and antitrust and justice division,” he stated.

“It takes a in point of fact very lengthy time and in total no action. China is device more action orientated,” he stated, including that Americans are not feeble to the charge.

“Like a flash choices, if made accurately, will force these companies to reform and give a gamble to smaller companies, which we make investments in, to like a gamble, environment up a more wholesome ecosystem,” Lee stated.

Ignore China ‘at your anxiety’

Earlier this week, ad guru Martin Sorrell warned that or not it’s unwise for companies to entirely ignore China no topic the challenges that exist in the country.

“It’s a long way the arena’s 2d greatest financial system,” Sorrell suggested CNBC’s “Impart Box Europe” on Monday. “Or not it will likely be the arena’s greatest financial system in about a years, not on a per capita foundation, but on an absolute foundation, and likewise you ignore it at your anxiety.”

Final week, billionaire George Soros criticized Blackrock, the arena’s greatest asset supervisor, for its investments in China. Writing in The Wall Boulevard Journal, Soros described BlackRock’s initiative in China as a “tragic mistake” that could perchance possibly “hurt the nationwide security interests of the U.S. and other democracies.”

In response, a BlackRock spokesperson stated: “The US and China like an ultimate and complex financial relationship.”

They added: “Total commerce in items and products and services between the 2 countries exceeded $600 billion in 2020. Thru our investment whisper, U.S.-based mostly entirely mostly asset managers and other monetary institutions contribute to the financial interconnectedness of the arena’s two greatest economies.”

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