Handshake of hope or political play? Xi’s message to China’s business leaders

Chinese President Xi Jinping has recently held a high-profile meeting with top CEOs, signaling a break from the past government crackdowns that shook the private sector. 

Proceeding from a latest article, Foreign Policy describes that during his speech, Xi reassured the CEOs that the challenges faced by the private sector were "localized, temporary, and solvable," emphasizing that the relationship between the government and business should be "amicable and clean." Under Xi’s leadership, China had previously prioritized state-run sectors, often to the detriment of private enterprises. 

However, the tone of the meeting was complex. While Xi acknowledged the economic significance of private entrepreneurs, he also made it clear that they were expected to show deference to him. The leader’s presence remained the focal point of the gathering, with the CEOs arranged in concentric circles of importance around him. Among those in the inner circle was Alibaba’s Jack Ma, who had largely remained out of the public eye between 2020 and 2023 after his firm’s fintech spinoff became a key target of the government’s tech crackdown, which led to the cancellation of a $34 billion IPO. Once one of China’s most outspoken billionaires, Ma’s outspoken criticism of regulators ultimately led to his fall from grace.

Jack Ma saw a partial return to favor in 2023 after his Ant Group paid a hefty fine, but this week’s meeting—and Xi’s handshake with him—marked his complete reintegration as a figure endorsed by the Chinese Communist Party (CCP), though in a quieter role. However, Ma was seated at the far end of the table from Xi, alongside Liang Wenfeng, founder of the AI firm DeepSeek.

As economist and FP contributor Lizzi C. Lee noted, the seating arrangement highlighted Xi’s priorities. Those closest to the leader—including Liu Yonghao, chairman of agricultural giant New Hope—seemed to signal a shift away from the platform economy, focusing more on hardware, manufacturing, solar energy, and agricultural technology. 

Notably absent were two of China’s major internet giants, Baidu and JD.com. Instead, Huawei CEO Ren Zhengfei, known for his strong ties to the state and his previous conflicts with the US government, was given the spotlight, taking the first speaking opportunity after Xi.

The impact of a meeting like this week’s will likely ripple through the party-state, with local officials mirroring Xi’s approach to private enterprises in their own regions. This could make entrepreneurs—ranging from billionaires to local business owners—less susceptible to the extortionate practices that have long been part of doing business in China. It would also level the playing field for them when competing with state-owned enterprises. 

Such a shift might be more effective than changes to tax and labor policies, as private businesses in China often navigate a gray zone of informal, negotiated relationships with government officials. During the crackdown, the number of new start-ups plummeted from over 50,000 in 2018 to fewer than 1,000 last year. The stability suggested by Xi’s approval may reassure investors about the security of their capital. However, this sense of reassurance is fragile—Xi could easily reverse his more private-enterprise-friendly stance if he believes the CCP’s priorities require it.

By Naila Huseynova