SHANGHAI/HONGKONG : Buy the state, sell the capitalist - that's how global investors are trying to play China's latest anti-graft crackdowns as they see private enterprise increasingly sidelined in Beijing's quest for 'common prosperity'.China's recent sweep of the medical sector came as a shock to many i
SHANGHAI/HONGKONG : Buy the state, sell the capitalist - that's how global investors are trying to play China's latest anti-graft crackdowns as they see private enterprise increasingly sidelined in Beijing's quest for"common prosperity".
That forced many investors to quickly draw parallels with last year's crusade against private tutoring and a long-running one against tycoon Jack Ma's consumer finance firm Ant Group. "This links to the idea of common prosperity because it's the state's job to guarantee a level of provision of basic services, whether it's education or healthcare, so it's important for the state to have a role," he said.While the CSI Medical Services Index is down 4.4 per cent this month and 20 per cent so far this year, investors have snapped up shares of state-owned medicine producers such as Beijing Tongrentang Co, which is up 14 per cent this month.
The CCP's July Politburo meeting reinforced the message, with the top policymaking body pledging to put a floor under the property sector, help indebted local governments heal and boost consumer demand. "Basically the message they were getting from the government was that they should be doing some of this innovation for national service, as opposed to for profitability only. That was a lightbulb for us," said Masi, who was once bullish on healthcare.Xi himself has often said that private companies should be"rich and loving," be"patriotic" and share the fruits of their growth with employees more equitably.
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