What the eclipse of Tencent by a liquor company says about Xi’s China

WHAT would it say about US innovation and President Joe Biden’s stewardship of the economy if America’s largest beer company, Anheuser-Busch InBev, had a bigger market capitalisation than Apple? Nothing good, probably, and indeed the very thought is a ridiculous one. Apple’s US$2.2 trillion market cap is almost 28 times larger than AB InBev’s US$80 billion.

But that is exactly what happened recently in China, where Xi Jinping is about to embark on a third term as Communist party leader, military commander-in-chief and state president. Late September, China’s most famous liquor maker, Kweichow Moutai, overtook Tencent as the country’s most valuable company.

How can this be? Tencent is one of the most innovative and successful technology companies in the world’s second largest economy. It developed the country’s most popular instant messaging and social media app, WeChat, and its WePay online payments platform is second only to Alibaba’s Alipay. Kweichow Moutai, which brews a strong-smelling, 76 to 106-proof grain liquor, sells hangovers.