China’s Alibaba Group (9988), will invest 100 billion yuan (HK$120.34 billion) by 2025 in support of “common prosperity,” it said, becoming the latest corporate giant to pledge support for the initiative driven by President Xi Jinping.
Beijing has been encouraging companies to share wealth as part of the effort to ease inequality in the world’s second-largest economy.
Other companies that have made similar announcements include Tencent Holdings (0700), which also pledged 100 billion yuan, and Geely Automobile (0175).
The government-backed Zhejiang News website said Alibaba’s funds will go towards areas such as subsidies for small and medium-sized enterprises and improving insurance protection for gig economy workers such as couriers and ride-hailing drivers. It will also set up a 20 billion yuan “common prosperity development fund”, the newspaper said, with Alibaba confirming the report.
The e-commerce giant and its tech rivals have been the target of a wide-ranging regulatory crackdown on issues ranging from monopolistic behaviour to consumer rights. Alibaba was fined a record 18.2 billion yuan in April over monopoly violations.
Meanwhile, at least 73 companies, including China’s largest insurer Ping An Insurance (2318), food delivery giant Meituan (3690) and the state-owned Bank of China (3988) used the ‘common prosperity’ slogan in statements to shareholders filed to the Hong Kong, Shanghai and Shenzhen stock exchanges in the two weeks ending August 31.
While that accounted for less than 2 percent of the more than 4,000 filings surveyed by Bloomberg News, it featured some of the country’s most-influential firms.
Xi’s push to narrow the country’s wealth gap has sent shock waves through the economy, triggering market sell-offs and prompting a flood of charitable giving among the country’s billionaires. A meeting led by the president Monday explicitly called on officials to “urge companies to obey the leadership of the party,” as reforms are rolled out.