After 18 months in the dark, the Chinese ride-hailing giant Didi Global Inc. has been told by the powers that be in China that it can now start signing up new users again.
Didi was just one victim in the tech milieu in China that was part of a Chinese Communist Party’s crackdown on tech, which has seen various far-reaching regulations over the past three years. During that time, China’s internet regulator, the Cyberspace Administration of China, imposed new regulations on all manner of tech, including online education apps and ride-hailing apps. The shakeup caused chaos in the tech industry there, although as 2022 advanced, it started to look like things were calming down.
Didi was something of a champion in the Chinese startup sector, but its success may have led to its downfall. In a matter of days after the company’s $4.4 billion initial public offering on Wall Street in 2021, the Chinese government banned the app in China. It announced it had started an investigation into the company based on “illegally collecting user data.” After such a dramatic downfall, Didi said it would comply with the investigation.
At the time, many pundits believed the only thing Didi had done was rankle the government by going public overseas. Later in 2021, the company announced that it would delist from the New York Stock Exchange and head in the direction of Hong Kong. For its alleged breaches of China’s cybersecurity rules, Didi also had to hand over 8 billion yuan ($1.2 billion) to the state’s cyberspace regulator.
“Our company has taken serious steps to cooperate with the country’s cybersecurity review, deal with the security issues found in the probe, and implement comprehensive rectifications,” the company wrote today on the social media platform Weibo.
The good news for Chinese tech and the investors that have been hampered by regulations over the last few years is that it seems now that the clampdown is well and truly over. After a tempestuous time during the now-eased pandemic lockdowns, China is trying to rehabilitate its economy.