Comments by "shazmosushi" (@shazmosushi) on "Is Ant Group a Risk to China's Financial System?" video.

  1. It pretty remarkable how powerful China's protectionism strategy is: For businesses that heavily depend on "network effects" (like PayPal, and social media companies like Facebook, Reddit etc), the playbook is to completely block the foreign firm using regulation and the Great Firewall of China, then locally develop a product that fits the niche. For businesses with difficult-to-master technology, the playbook is to promise great riches but block foreign companies from setting up wholly-owned subsidiaries, instead offering market access only through a joint venture with a domestic Chinese firm. Then all valuable technology, expertise, trademarks and intellectual property are transferred to the local firm before the foreign firm is blocked from the market. We'll see if a Biden administration will push for World Trade Organization reform to ensure equal market access. Also it's still an open question whether domestic Chinese firms can compete in the global economy if faced with international competitive pressure. In Japan, Amazon's local subsidiary is pretty dominant alongside Japan's domestic e-commerce website Rakuten.
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  2.  @evanh9301  Potentially. I see Trump = tough rhetoric, trade war and high tariffs, but hurting the US alliances system and international leadership. I see Biden = Softer on the CCP in rhetoric, won't increase the tariffs, but more likely to bolster US alliance and international leadership, and do longer term economic integration through things like the Trans-Pacific Partnership (a trade agreement designed specifically to exclude China). Congressional Democrats like Senator Chuck Schumer are definitely far tougher on the Chinese Communist Party than Biden has been so far. We'll see if that kind of anti-CCP thinking within his own party influences the decisions Biden will make.
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  3. PayPal only entered the market after buying the Chinese domestic firm GoPay less than 12 months ago, and it was only this year that China allowed full foreign ownership of financial firms. But WeChat and Alipay have already developed strong 'network effects', so the odds are stacked against PayPal and other platforms. You're right that the US under President Trump is becoming increasingly hostile to firms in China with close links to the Chinese Communist Party since the trade war began. To expand on your comment, I'll mention that since 2019 the US has been using the Entity List to block companies like Hikvision and Dahua security cameras due to those companies being involved in the Uighur concentration camps, but DJI drones are currently still available for consumers to buy (admittedly the US government is banned from using DJI drones). Huawei and ZTE (makers of network equipment and android devices) have been added to the Entity List due to concerns the equipment will (rightly or wrongly) be used for espionage. I am very interested to see what President Biden will do with ongoing China trade disputes. I hope a reformed World Trade Organization plays a bigger role in such dispute mediation, but I think this is unlikely.
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