Chinese hi-tech sector has been damaged by the trade war with the USA, by Chinese regulators and other market conditions


Until recently, China’s tech giants seemed to pose a real threat to Silicon Valley.

According to an interesting analysis by Bloomberg, 2018 was a nightmare year for the Chinese technology sector.

Chinese tech companies have suffered heavy losses since the beginning of the year.

Tencent Holdings Ltd.

In January 2018 Tencent Holdings Ltd. was valued at $ 220 billion.

Since then it has lost 38% of its value thanks to the new limitations made by Chinese regulators that have stifled the Chinese video game market, due to concerns about gambling addiction.

A tentative solution was adopted at the end of October but did not clarify some key points on the revenue licenses for the sector, leaving Tencent and other publishers in a sort of Limbo.

Alibaba Group Holding Ltd.

Alibaba by Jack Ma represents the symbol of internet success in China.

In any case, the company lost 14% of its value in 2018, or about 60 billion dollars, and at the beginning of November, it had to downgrade its projections for the rest of the fiscal year ending in March, as a result of the commercial war. with the USA.

Xiaomi Corp.

The Chinese smartphone giant, which was valued at about $ 100 billion, had the misfortune to become public in mid-July when tensions between the US and China increased.

Since then, the share price of the company has lost about 22% of the value of the initial public offering.

ZTE Corp.

ZTE, a maker of network devices and smartphones, said in October that it would lose $ 1 billion in 2018 after the US Department of Commerce banned the purchase of parts from US suppliers.

ZTE was accused of selling equipment to Iran and North Korea, bypassing US sanctions.

As a precondition for the removal of the ban, ZTE had to replace its leadership, preparing to rebuild the brand.

The market value of ZTE halved during the year.

Huawei Technologies Co.

Huawei not long ago had even surpassed Apple in terms of the number of devices shipped and was destined to become one of the undisputed protagonists of the fifth generation of mobile phones, preparing for the rise of some of the most important American chip makers.

Instead, President Trump blocked the merger with Qualcomm Inc. and Broadcom (a Singapore-based investment fund) invoking national security and pulling Huawei into the spot.

Huawei was subsequently blocked from selling devices in Australia and had a frozen contract with Korea.

Source: Bloomberg


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