Last week, Chinese technology giant Alibaba applied for a primary listing in Hong Kong. If you were looking for a sign of how negotiations are going between Beijing and Washington over the latter’s plans to ban trading in Chinese companies, this is it. Read: badly.
Alibaba is one of about 200 companies that will be delisted from New York stock exchanges in 2024 because China has blocked US regulators from accessing their financial audit records despite US law requiring that they be inspected triennially. The trading ban will also be applied to dozens more Chinese companies with equity or debt that is traded outside exchanges in the US.
Alibaba’s new Hong Kong listing will simplify a transition to trading solely in Hong Kong if — or when — US regulators force it to delist from Wall Street. Those with skin in the game seem to be preparing for that eventuality.