China’s richest man, Zhong Shanshan has spoken out against online shopping platforms, accusing them of starting price wars that have negatively impacted a wide range of industries as the country faces an economic downturn.
In unusually candid comments that have been largely censored by state-run media, Shanshan, founder of Nongfu Springs, also criticized the Chinese government, claiming it was “neglectful” in not intervening to stop the aggressive pricing trend.
Zhong’s remarks are rare, as it is uncommon for Chinese business leaders to openly criticize the government. Those who have done so in the past have often faced repercussions.
Speaking during a visit to a county in eastern China on Tuesday, Zhong directly targeted Pinduoduo, an e-commerce platform owned by PDD Holdings, accusing it of harming businesses with its pricing strategy.
“Internet platforms have disrupted (our) pricing structure. Specifically, Pinduoduo’s pricing model has caused significant damage to China’s brands and industries,” Zhong said, as quoted by The Paper, a state-controlled media outlet.
“It’s not just that bad money is driving out good money. This is an entire industry shift, and pricing has become the industry’s direction.”
Pinduoduo has experienced rapid growth in recent years, partly due to its competitive pricing approach.
However, Zhong also pointed out that the Chinese government has not done enough to address the situation. “The government has not intervened in this industry shift, and I believe the government has been negligent in its responsibility,” he added, according to a transcript from Sina Technology and several news videos.
As China’s economy slows and job prospects diminish, consumers are becoming increasingly frugal, cutting back on spending from groceries to electronics and cars. Discounts and special deals are being offered across brands, including those targeting premium markets, with a far-reaching impact.
Zhong’s comments come at the end of a difficult year for the billionaire. Earlier this year, he faced a wave of backlash from nationalists who accused him of being unpatriotic.
This campaign caused a significant drop in the market value of his beverage company and hurt its sales. Bloomberg reported that tens of billions were wiped from Nongfu’s market capitalization, and in August, Zhong lost his position at the top of China’s rich list to Colin Huang, the founder of Pinduoduo.
Despite this, Zhong has regained his spot as the wealthiest individual in China, with a net worth of $52.2 billion, according to the Bloomberg Billionaires Index.
ALSO READ FROM NIGERIAN TRIBUNE
and then