Alibaba to invest $15.5 billion for prosperity

China’s Alibaba Group will invest 100 billion yuan ($15.5 billion) by 2025 in support of “common prosperity”, it said, becoming the latest corporate giant to pledge support for the initiative driven by President Xi Jinping.

Beijing has been encouraging companies to share wealth as part of the effort to ease inequality in the world’s second-largest economy. Other companies that have made similar announcements include Tencent Holdings, which also pledged 100 billion yuan, and Geely Automobile.

The government-backed Zhejiang News website said Alibaba’s funds will go towards areas such as subsidies for small and medium-sized enterprises and improving insurance protection for gig economy workers such as couriers and ride-hailing drivers.

It will also set up a 20 billion yuan “common prosperity development fund”, the newspaper said, with Alibaba confirming the report.

The e-commerce giant and its tech rivals have been the target of a wide-ranging regulatory crackdown on issues ranging from monopolistic behaviour to consumer rights. Alibaba was fined a record $2.75 billion in April over monopoly violations.

The sector has also attracted criticism for the treatment of delivery workers and ride-hailing drivers, most of whom are not covered by basic social and medical insurance. Food delivery platform Ele.me and supermarket operator Freshippo, both of which are owned by Alibaba, were among operators called to a meeting last month with government regulators on improving safety and labour rights for delivery workers. Alibaba Group Holding’s revenue beat estimates in May 2021 after China’s e-commerce leader rode a post-pandemic recovery and begins to move past a bruising antitrust investigation.

Jack Ma’s flagship e-commerce firm reported revenue of 187.4 billion yuan ($29 billion), compared with the 180.4 billion yuan average of analysts’ estimates. But it swung to a 5.5 billion yuan net loss, after the company swallowed a $2.8 billion fine for monopolistic behaviour imposed by Beijing.