Bytedance Inc. to sell or close US operations of social media app TikTok. As time passes for, US firms operating in China are focusing on a potentially more devastating ban to target mobile-payment app WeChat.
Victor White, managing director of Macquarie Securities in Hong Kong, said, “Think of American society if you abolished credit cards all of a sudden.”
Mobile payments have become busy in Chinese society, where credit cards have never really been caught. An estimated 83% of all payments in China in 2018 were via mobile phone apps. About 92% of the business is split between WeChat, which is owned by Tecent Holdings and Alibaba’s Alipay.
More than a dozen US companies, including Apple Inc., Walmart Inc. and the Walt Disney Company, last month organized a call with the Trump administration to express their concerns about a vague executive order over transactions with Tencent Imposes restrictions and is ready to influence it. September 20 – Whatever the deadline is, the Bytdance Trump administration must get an American TikTok to secure the sale before it closes.
The Commerce Department did not respond to Fox Business’s request for more information.
TIKTOK removes American unsold discounts
Trump is concerned that both apps capture large levels of data from users and allows the Chinese Communist Party to compile personal and proprietary information for Americans.
For any company operating in the country, however, mobile payment apps are their lifeline.
An American ban on WeChat would “just be disastrous,” KR Gibbs, president of the American Chamber of Commerce in Shanghai, told Fox Business. “It is difficult to see how some of these American companies can survive in this market without using WeChat payments.”
The immediate effect would be lost sales for companies such as Nike, as customers who could not use their preferred payment method would react to their business to rivals such as Adidas based in Germany.
But there is also a possibility that a ban from the Trump administration would dominate companies outside the US whose applications ride the WeChat system to stop using the app for fear of secondary sanctions.
WeChat, which allows Chinese citizens outside the country to stay at home with friends and family, can also be used for services that are as diverse as cabs and take out mortgages.
Trump ‘campaigned’ with China
Such considerations are the reason that the Trump administration may offer some exclusions in hopes of connecting the needle between national security and commercial reality.
Apps like WeChat, which had 1.17 billion monthly active users at the end of 2019, most of which were in China, which is why the country sees nearly 20 times as many mobile transactions as the US, giving it greater access to data and A leg up in artificial intelligence research.
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“If China is accumulating too much data without the same privacy restrictions being implemented in the West, then theoretically, they could pursue artificial intelligence more aggressively than other Western countries,” White said. “So it’s not just monitoring applications. It also has privacy implications. “