Alibaba, Chinese tech stocks fall on Beijing's AI control proposals
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Alibaba (NYSE:BABA), JD.com (JD) and other big-name Chinese tech stocks retreated Wednesday in the wake of China's Internet regulator proposing new rules to oversee and control the use of artificial intelligence technology around the country.
On Tuesday, the Cyberspace Administration of China proposed that companies in China will need to pass a government security review before they get the OK to provide AI services. Those companies will also be held responsible for any content their AI technologies create, if the regulations are approved.
The Chinese government's proposals to tighten up on AI came on the same day Alibaba (BABA) held an event in Beijing in which it showed off AI technology that it intends on incorporating into all of its products. The technology, called Tongyi Qianwen, is said to be similar in concept to OpenAI's ChatGPT service, which itself has spurred the recent boom in AI interest.
For its part, Alibaba (BABA) saw its shares fall almost 6% Wednesday, while JD.com (JD) also slumped by almost 8%, and PDD Holdings (PDD) gave up more than 5%.
Losses also came for NetEase (NTES), which slipped by 1%, and Weibo (WB), down by 2.6% on the day.
The KraneShares CSI China Internet ETF (KWEB) gave up 4.5% by the time the closing bell rang.
Baidu (BIDU) shares managed to just eke into positive territory, with a gain of 0.2%. The Chinese Internet search leader was stung when in late March it canceled an event where it was supposed to show off its AI technology, called Ernie Bot.