This is the Speech that Jack Ma gave at Shanghai’s Bund Summit on October 24th, 2020, where he criticizes China’s regulations as an obstacle for innovation:
- “The Basel Accords have put great limitations on Europe’s ability to innovate as a whole, for example, in digital finance. Basel, more like a seniors club, is about solving the problem of an aging financial system that has been operating for decades, and Europe’s aging system is extremely complex. But the problem in China is the opposite: it is not a problem of systemic financial risk, because China’s financial sector basically doesn’t have a system.”
- “China’s financial sector, like other developing countries that have just grown up, is a young industry that does not have a mature ecosystem and is not fully moving. China has many big banks. They are more like big rivers or arteries in our body’s circulatory system, but today we need more lakes, ponds, streams and tributaries, all kinds of swamps. Without these parts of the ecosystem, we will die when we are flooded, and die when we are in a drought. So, today we are a country that bears the risk of lacking a healthy financial system, and we need to build a healthy financial system, not worry about financial systemic risks.”
- “President Xi once said, “success does not have to come from me.” I understand this phrase to be about a sense of responsibility. It’s about taking responsibility for the future, for tomorrow, for the next generation. Many of the world’s problems today, including China’s, can only be solved by innovation. However, for real innovation to happen, no one will show you the way, and someone must shoulder that responsibility, because innovation is bound to make mistakes. But the question is not how not to make mistakes, but whether we can perfect and correct them after making mistakes and persistently innovate. To make risk-free innovation is to stifle innovation, and there is no risk-free innovation in this world. There is no such thing as risk-free innovation. Oftentimes, managing risk down to zero is the biggest risk.”
- “Today, it’s really difficult to regulate ourselves; it’s hard to conduct regulation everywhere around the globe. Innovation mainly comes from the marketplace, innovation comes from the grassroots, innovation comes from young people. Regulatory challenges are getting bigger and bigger. In fact, jian [editor’s note: English word is “supervision”, the first character in the word for “regulation” in Chinese] and guan [editor’s note: English word is “management”, the second character in the word for “regulation” in Chinese] are two different things. “Supervision” means watching you as you develop and paying attention to your development. “Management” means intervening when there is a problem or when there is a foreseeable problem. We are very good at “management”, but our “supervision” ability is sorely lacking.”
- “Good innovation is not afraid of regulation, but is afraid of being subjected to yesterday’s way to regulate. We cannot use the way to manage a railway station to manage an airport. We cannot use yesterday’s way to manage the future.”
- “I think there is another phenomenon. Many regulatory authorities around the world have become zero risk, their own departments have become zero risk, but the entire economy has become risky, the whole society has become risky. The competition of the future is a competition of innovation, not a competition of regulatory skills. Now, each country’s regulation is more ruthless than the next, all the development is a mirage, but by not allowing it, each cut is bloody.”
The full transcript is available at Kevin Xu’s blog.