Beijing/Washington: – The ruling Chinese regime has launched a vigorous move to prevent Chinese companies from listing on the US stock markets for raising capital. A few days ago, a Chinese company, Didi Inc., was listed on the New York Stock Exchange and submitted an IPO. Within days of the IPO, Chinese authorities took action against Didi Inc.’s app. This is the third time the Chinese regime has taken action against its own companies. Didi Inc. The Chinese authorities had earlier taken action against Alibaba and Tencent.
So far, about 250 companies, including eight Chinese state-owned companies, have been listed on the US stock exchange. The purpose of this registration is believed to be to raise a large amount of funds internationally, including in the United States. Chinese companies have so far managed to raise nearly $2 trillion from such listings. In the first six months of this year, 34 Chinese companies raised about $12.5 billion from the US stock markets.
Although Chinese companies are raising large sums of money from US stock exchanges, the number of actions taken by the US administration against them has increased in the last few years. The Trump administration has blacklisted many Chinese companies and imposed various sanctions. Chinese companies are being targeted because of the issues like Xinjiang, Tibet, Hong Kong, trade plunder, espionage, and domination in the technology sector. Last month, the Chinese Parliament passed a law called ‘Law on Countering Foreign Sanctions’ in response to the US crackdown.
But the Chinese regime has now begun to crack down on Chinese companies so that they do not go to the US for funding. China has initiated efforts to raise Chinese companies by listing on the Hong Kong exchange instead of the US stock markets. Analysts claim that this is aimed at attracting more and more foreign investors towards China, delivering a jolt to the US investment sector. Analyst Paul Gillis claims that the next decade will see several Chinese companies exit the United States. Analyst Donald Straszheim said ‘Relations between the United States and China are not good at the moment. Therefore, such steps are being taken by China because of possible action’.