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Can Zuckerberg's charm offensive bring Facebook to China?

Facebook founder Mark Zuckerberg has been hard at work trying to bring his product to China. A series of high-profile trips to Beijing, where he has met with CCP officials, are starting to bear fruit. He recently met with Alibaba founder, Jack Ma, and later with China’s propaganda chief Liu Yunshan. Presently though, China has a strict ban on Facebook and other social media services for its base of 700 million internet users.
Zuckerberg has long been fascinated with China and has even had the distinct honour of meeting with the country’s president, Xi Jinping. He is determined to win the hearts of China’s elite, and his efforts appear to be gaining traction as news of his visits is splashed over the Chinese internet – in stark contrast to LinkedIn and Uber which hardly gained any publicity whatsoever. But the Chinese remain wary of foreigners wielding too much clout in their country.
Zuckerberg is effectively raising the bar for foreign companies; showing them that hard work and a genuine devotion to China is the way to go. If he succeeds in winning the trust of the Chinese, it will indeed be a big win for Facebook. One of the most important people to impress is Mr Liu – a member of the Politburo’s Standing Committee. If Facebook can play by China’s internet rules, Zuckerberg may find himself with a foot in the door to China’s vast untapped market potential.

Praise for China and multiple ‘bromances’

Zuckerberg made a big splash with pictures of himself jogging through Tiananmen Square recently. He avoided any criticism of China in an effort to narrow the gap between Facebook’s objectives and China’s regulations. He heaped praise on China for focusing on developing the country’s pool of engineers, and his meetings with Jack Ma, Liu Yunshan and Lu Wei (China’s internet chief) are important steps in the pathway to Facebook’s potential entry into China.
Of course it helps that Zuckerberg is married to Priscilla Chan – a Chinese-American. For the Facebook mogul it is clear that ‘no’ is not an answer he is willing to take, even when tech giant Google ended its efforts at wooing and wowing the country. But getting into China is a not a guarantee of success either: China’s domestic internet giants are strong enough to stave off the competition – Taobao’s routing of eBay is a case in point. Other companies like Uber were outmuscled by Didi Kuaidi too.

Traders not chomping at the bit yet

Zuckerberg is committed to learning Mandarin which he proudly flaunts when hosting China’s leaders. And despite internet hostility to Facebook in China, Zuckerberg remains determined. This may appear foolhardy given that China is so opposed to the freedoms of social media. Ironically, the Chinese transliteration of ‘Facebook’ is ‘fei si bu ke’, which roughly means ‘doomed to die’, and it seems highly unlikely that Facebook will gain a foothold in its current form, anytime soon.
As it stands, China has flat-out banned Facebook. While Russia had the Iron Curtain, China has the Great Firewall. And nothing gets through that the authorities don’t want – including Google, YouTube and Twitter. In their place are state-controlled social media giants in Baidu, WeChat and Weibo. The problem though is that there is no authentic freedom in these social media services – they are all strictly policed by the authorities in Beijing.
President Xi is staunchly against freedom of speech in the country and wants everyone to remain blindly committed to the Chinese Communist Party. As a result, any future Facebook China will be nothing like Facebook proper: it will be so limited by government constraints that it will become just another propaganda tool.
Nevertheless, traders may find value in Facebook’s entry into China in any form, rather than the present absence. Ultimately, traders know that China does what China wants and for now that is developing domestic industry and not allowing foreign companies to grow roots in China.
Brett Chatz
Intertrader Direct
For more information, trading education and offers visit Intertrader Direct
The content of this article is the personal opinion of the author and not Intertrader Direct. The information and comments provided herein under no circumstances are to be considered an offer or solicitation to invest. Nothing herein should be construed as investment advice. The information provided is believed to be accurate at the date the information is produced.

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