Investing in China: Avoid Crackdowns and Follow Supported Sectors

My personal view: if you choose to invest in China, select areas its government strongly supports at present, or at least does not aggressively suppress. What is being suppressed? The following are my impressions. 1. Internet-related businesses: information flows and free expression are difficult to control comprehensively, potentially affecting political stability. 2. Fintech, such as Ant Financial: financial stability and comprehensive control of money flows are important tools for social stability. 3. Since Xi Jinping took office, policy has leaned further toward communist or socialist thinking, actively dismantling the ‘three mountains’ of education, healthcare, and housing. The idea is simple: equal, affordable access for everyone in China. 4. Film, entertainment, and gaming face strict limits for perceived harm to people, especially children’s physical and mental health. Anything the government considers harmful to social norms is suppressed; livestreaming is affected too. In short, avoid whatever might directly or indirectly threaten political stability or depart from its socialist thinking. ---- What is strongly supported? Usually hardware or fields helping achieve the government’s ideal of social stability. 1. Semiconductors: IC design, wafer fabrication, packaging, and testing, pursuing chip self-sufficiency rather than dependence on Europe, America, Japan, and others. 2. Critical components, including optoelectronics, lasers, and carbon fiber. 3. Surveillance, including Hikvision and Dahua, supporting the Skynet policy of comprehensive monitoring and social stability. 4. AI plus IoT: smart cities and transport with sensors and cameras everywhere, using facial recognition and wireless tracking to exercise control over people. 5. AI plus IoT plus agriculture: China is a major food importer, but food self-sufficiency is national security. 6. Defense industries 7. Aerospace and satellites 8. Electric vehicles 9. Batteries 10. Energy 11. Environmental protection 12. Industrial automation