An Insight, An Idea with Jack Ma

Jack Ma, Founder and Executive Chairman of the Hangzhou, China-based e-commerce giant Alibaba, sits at the intersection of many of the currents that define the zeitgeist as we begin what promises to be a tumultuous year: He leads a major player in US-China trade on the eve of what may be a trade war, when Beijing appears ready to supplant Washington as the standard bearer for economic globalization; and he heads one of the companies at the forefront of China’s AI and big data revolution, applying that technology in ways that promise to generate as much controversy as profits.

Ma appeared just one day after a lunch with Chinese President Xi Jinping and a week after a visit to Trump Tower, where he met with the American president-elect. Ma described his meeting with Trump as “productive – much better than I [had] thought,” and said that Trump was "open-minded,” and “listened when I talked.” He said that the conversation focused on how to create American jobs through the export of goods produced by small business, and agricultural products. They did not, he said, debate trade policy or currency manipulation.

Ma praised the United States for its “wonderful strategy” of outsourcing manufacturing to Mexico and China while focusing on intellectual property and branding, but slammed the US for squandering those profits on what he claimed were 13 wars fought over the last 30 years, instead of spending the money on infrastructure and addressing the needs of blue collar workers and “the people who were not good in schooling.” The horrific shock of the global financial crisis, he said, might have been better absorbed had the US focused on building industry in its Midwest. “It was your strategy,” he said, speaking of the United States, “Not other countries stealing jobs."

While championing globalization, he cautioned that it needed to be more inclusive. Global trade has been dominated in recent years by 60,000 large companies, he said. Just a few centuries ago it was dominated by a handful of kings and emperors. “What if in the next 30 years it’s controlled by six million companies?”

Ma called for the creation of an EWPT – an Electronic World Trade Platform to take its place alongside the WTO. The governing charter of such an organization should be created not by government bureaucrats but by businessmen, he said. “We think [the] EWTP should negotiate it, and then get the endorsement of governments.”

Contrasting his asset-light, platform-focused approach with Amazon’s apparent desire to own the entire e-commerce value chain – airplanes, warehouse, and logistics companies – Ma noted that his goal in creating an ecosystem is to “empower others to sell, empower others to service.” “Using internet technology,” he said, “we can make anyone become Amazon.”

Ma argued that Alibaba and its marketplaces have struggled against the inevitable presence of counterfeit sellers in an open e-commerce platform, but that progress has been good. With big data and AI-driven anti-counterfeit measures, counterfeiters are shying away from Taobao and TMall, Alibaba’s major e-commerce marketplaces, saying that Alibaba will report them to law enforcement and noting that they’ve helped put over 400 in jail already.

Offering parting advice, Ma focused on the number 30: “The next 30 years are critical for the world,” he said, explaining that any technological revolution lasts for 50 years and that the first 20 –

that gave the world Google, Amazon, and other major internet companies – are now behind us, while the 30 to come will see whether the fruits can be equitably distributed. "Pay attention to those people who are 30 years old,” he added – the “digital natives” who came of age with the internet already a fact of their lives. Finally, he said, “Let’s pay attention to those companies that have 30 or fewer employees,” he said, underscoring his focus on small business.