(Bloomberg) – The government of one of China's leading technology centers sends officials to 100 local companies, including e-commerce giant Alibaba Group Holding Ltd., recent efforts to exert greater influence on the country's massive private sector. [1
"We understand this initiative from Hangzhou The city government has set itself the goal of promoting a better business environment in support of Hangzhou-based companies. The Government Representative will act as a bridge to the private sector and not interfere with the Company's business, "said Alibaba in a textual statement. Representatives of Wahaha and Geely did not immediately respond to requests for comments.
The Hangzhou government said the initiative aims to improve the flow of work between officials and China's high-tech companies and manufacturers. However, the move could also be seen as an attempt to keep an eye on a non-governmental sector that is becoming more important as the main driver of the world's second largest economy. Representatives of the country's public security system are already anchored in China's largest Internet companies, which are responsible for preventing crime and repressing false rumors.
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The Communist Party units are working effectively in the enterprise, "said Paul Gillis, a professor at the Guanghua School of Management of Peking University. "While China legitimized capitalism, the magnitude of state influence should never disappear. Occasionally private entrepreneurs forget this and are reminded of it. "
Zhejiang is considered the cradle of modern Chinese private enterprise, home to a generation of home-made billionaires ranging from Alibaba's Jack Ma and Geely founder Li Shufu to Wahaha's Zong Qinghou. In 2001, the Communist Party incorporated so-called "red capitalists" or private entrepreneurs in the party and, a year later, enabled them to become part of the country's legislation.
Nevertheless, the relationship between Beijing and well-known business people remains sensitive. It has been noted that the government is attempting to increase its official presence in non-governmental companies by, among other things, requesting large private companies to set up and maintain a party branch. It was not clear if the 100 companies based in Zhejiang owned foreign companies.
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– With support from Tian Ying and Rachel Chang Reporters about this story: Lulu Yilun Chen in Hong Kong at [email protected]
Contacting for this story responsible editors: Edwin Chan at [email protected], Colum Murphy
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