According to Chinese state media, if the US loses Chinese companies, Wall Street will gradually alienate itself from the world’s most prosperous market, and the US will no longer be the true global financial centre.
Didi Chuxing, the Chinese ride-hailing behemoth, announced on Friday that it is beginning the process of delisting from the New York Stock Exchange (NYSE) and preparing to list in Hong Kong.
The US Securities and Exchange Commission (SEC) issued a mandate requiring foreign companies listed in the US to provide audits for inspection one day before Didi made the statement. Otherwise, they risk being delisted from the NYSE and Nasdaq after three years.
“The new SEC regulation clearly targets Chinese companies listed in the US. Analysts believe that it could lead to more than 200 companies being kicked off US exchanges,” Global Times reported.
Didi is the first Chinese company to announce its intention to delist from the NYSE following the SEC’s new regulation. The company went public in the United States in June without the approval of Chinese regulatory authorities, raising concerns that the personal information of hundreds of millions of Chinese users would be leaked, endangering China’s national security. More than 20 apps associated with the company were later removed from app stores. According to the report, the SEC’s new regulation has reduced Didi’s space for financing in the US from the other side.
There have already been calls in the United States for the removal of the majority of the “China concept stocks.” The examination of “China concept stocks” is expected to become more stringent. According to the report, the US provides various justifications for such scrutiny, including “financial security” and “national security.”
In the future, it will be more difficult for Chinese digital technology and application companies to be listed in the United States. Both sides will suffer losses as a result of this. However, the trend indicates that China is taking more initiative to adjust and adapt to new conditions, according to the report.
According to the Global Times, Chinese companies have other options, and if they return to China, they will greatly increase the attractiveness of the mainland and Hong Kong capital markets, potentially changing the global financial landscape gradually.