China has realized that it cannot win the technological competition with the US without private companies – private tech business is being rehabilitated

Last Monday, February 17, Chinese President Xi Jinping personally attended a meeting of the country’s top entrepreneurs, which was attended by Alibaba co-founder Jack Ma. The move was interpreted as an end to the era of repression and a shift toward support for the private sector by Beijing, Bloomberg reports.

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Over the past decade, Chinese authorities have repeatedly taken tough state measures against private companies in various industries. The latest event showed that Beijing is willing to soften its stance on players that provide a significant part of the economy, while Washington, by contrast, is strengthening its policy of widespread foreign trade tariffs. Xi Jinping gave a speech, greeting Jack Ma, the founder and CEO of the delivery service Meituan Wang Xing, and Xiaomi CEO Lei Jun.

Also in attendance were Wang Xingxing, the head of robotics startup Unitree, Liang Wenfeng, the founder of DeepSeek, and Ren Zhengfei, the founder of Huawei, all of whom are considered key figures in China’s strategy to reduce its reliance on American technology. Also in attendance were Tencent founder Pony Ma, as well as BYD’s Wang Chuanfu and CATL’s Robin Zeng, the latter two of which have played a major role in China’s rapid growth in electric vehicles. The president shook hands with Unitree’s Wang, as well as Ren and Ma.

The Chinese leader called on businessmen to maintain a competitive spirit and confidence in the country’s future, stressing the temporary nature of the problems they faced. He promised to level the playing field for all market players – a pressing issue in a country where the state exerts significant influence over all areas of the economy. Chinese lawmakers have pledged to revise the legislative framework to promote the development of the private sector. The event, according to experts, was a strong signal for “increasing public trust” in Beijing, and Xi’s presence at the meeting with entrepreneurs underscored its political significance.

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The crackdown on China’s private sector is widely believed to have begun in 2020, when Jack Ma criticized government policies and Beijing disrupted the initial public offering of Alibaba subsidiary Ant Group. The country subsequently launched a major campaign to tighten state control over the economy, curb the influence of billionaires, and reallocate resources to areas Beijing has prioritized, including national security and technological self-sufficiency. Ma has since disappeared from public view for a long time.

Now that China’s economic growth has slowed, the government has been forced to shift its harsh rhetoric toward the private sector to a more supportive one. In turn, companies have supported the head of state in his quest to ensure the country’s leadership in artificial intelligence. Alibaba’s Qwen AI model has performed well in official tests, and Apple has decided to deploy Alibaba’s AI in iPhones for Chinese users, a recognition of the company’s achievements.

It is hard to say for sure how much the Chinese authorities are willing to change their stance toward the private sector. A show of support from Xi would likely boost Chinese stocks and boost optimism among entrepreneurs. But much will depend on the specific policies that follow this signal.