Where is Jack Ma and what's the reason behind Alibaba's stock crash?
Jack Ma is the co-founder of Alibaba Group, one of the world's largest e-commerce businesses. As of May 6, 2022, he is the 30th wealthiest person in the world, with a total net worth of $35.7 billion, according to Bloomberg.
One year after retiring from being the chairman of Alibaba, in November 2020, Chinese billionaire Jack Ma went missing for more than two months. It is estimated that the reason behind his disappearance was his critical -and also the last- speech against the Chinese Communist Party. Since then, his whereabouts have been closely watched.
Most recently, China's tech market has been shaken by a report from China Central Television (CCTV). Claiming that a man surnamed 'Ma' has been detained, the report sparked a fall in the shares of Alibaba Group Holding and caused fluctuations in the country's tech market.
What happened exactly?
Ma's latest enterprise Ant Group is a financial technology company founded in 2014. Through its Alipay mobile banking app, the business controls China's digital payment sector. It also intends to transform finance in China by removing control from established organizations.
On October 24, Jack Ma gave a speech at the Bund Summit in Shanghai. In the speech, He criticized the supervision of financial regulations as outdated, adding that global banking rules were like an “old people’s club.” He went on to emphasize the need for a change in Chinese banking, which is negatively affecting entrepreneurs.
However, the Chinese government did not welcome these words, and after that, the Chinese Communist Party targeted Ma’s financial empire. Firstly on the 3rd of November, the Shanghai Stock Exchange canceled the Ant Group's initial public offering with the excuse of a “significant change” in the regulatory environment.
Later, Chinese regulators tightened their grip on the fintech sector and put Alibaba under heavy scrutiny.
Disappearance from the public eye
From November 2020 to late January 2021, Jack Ma was not seen in public. The rumors that he might have been placed under house arrest, detained, or even put to death were also spread.
More than two months later, on January 20, 2021, Ma made his first public appearance with a short video shot for a charity event. Later in May, he was seen visiting the company’s Hangzhou campus on AliDay, the annual gathering of the company’s family members. In October 2021, he was seen visiting institutions in the Netherlands.
More previous news about him reports that in January 2022, he appeared at a primary school in Hainan for the annual celebrations of the Rural Teachers Initiative that Ma founded to support the teachers working in the countryside of China, according to the South China Morning Post.
Jack Ma attended Alibaba's "Ali Day" staff and family event at the company's Hangzhou campus in May. Then he was seen in photographs shared on Chinese social media last month, depicting his visit to agricultural greenhouses in the eastern Zhejiang province. The rareness of his appearances is still very strange for such a figure that is known as the poster boy of technology entrepreneurs. He has been inactive on Twitter since his first disappearance, either. The last tweet he shared is from October 2020.
I am honored to partner with HRH The Duke of Cambridge @KensingtonRoyal & other global leaders and organizations to support the @EarthshotPrize and tackle the environmental challenges we all face. Together, we can protect our planet from climate change! https://t.co/0ax1imIZMC pic.twitter.com/EN6yissNGI— Jack Ma (@JackMa) October 10, 2020
Although China preferred to crack down on Alibaba, the country still needs Jack Ma. He is a very significant financial figure in the country despite everything. China must have known that intervening too much in his business may also damage them economically by causing other companies to flee or recede from the Chinese market.
A misleading report caused Alibaba to lose 9.4 percent of its shares
At the beginning of this week, China's state broadcaster China Central Television reported that an individual surnamed 'Ma' had been detained with the accusation of endangering national security. Following the allegations, Alibaba plunged as much as 9.4% in Hong Kong and lost about $26 billion of market value because of a simple misunderstanding.
The state television clarified the situation to prevent the turmoil, indicating that the individual was not Alibaba’s billionaire founder Jack Ma. People familiar with the situation confirmed the referred person in the report was not Jack Ma. However, none of these could prevent the 9.4 percent loss of market value in just a few hours.
The Global Times, a daily tabloid newsletter under the Chinese Communist Party's newspaper, the People's Daily, claimed that the suspect in question worked for an IT company and had created an online anonymous group aiming to “split up the country and subvert the state."
The newsletter further added that the suspect's name consists of three Chinese characters, unlike Jack Ma's name with two characters.
After the allegations came to light, Alibaba recovered the majority of its loss by the end of the day. However, the panic triggered by CCTV's one-sentence report shows the sensitivity of the tech space in China.