From Tencent to nine cents: is it time to buy Naspers/Prosus?
The US’s designation of Tencent as a military company serves as a further reminder of China business risks — but also opportunity
Chinese military companies are surely not the type of exposure you would expect to find in just about every South African’s pension savings. Yet the US government would have us believe that Tencent (and thus Naspers and Prosus indirectly) fall into this category.
It may sound like the underpin of a swanky new Asian restaurant, but the Chinese Military-Civil Fusion is quite different. It is important to understand it from the US standpoint — which is the side of the equation that commands the deepest capital markets, whether we like it or not. Reading the supporting note for the update to the section 1260H list issued by the US Defense Department is helpful. It gives an idea of just how broadly this list of “Chinese military companies” can be applied: “The People’s Republic of China’s (PRC) Military-Civil Fusion strategy supports the modernisation goals of the People’s Liberation Army by ensuring it can acquire advanced technologies and expertise developed by PRC companies, ...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.