Shares in the parent of Chinese social media giant WeChat tanked in Hong Kong on Friday after Donald Trump signed an executive order banning Americans from doing business with the platform.

Tencent plunged as much as 10 percent in morning trade before paring losses and ending down 5.04 percent at HK$527.50, dragging the broader Hang Seng Index down 1.6 percent.

The sweeping restrictions on the firm, which, according to an executive order, come into effect in 45 days, also cover ByteDance, the owner of popular app TikTok.

More than US$30 billion was wiped off Tencent's market capitalisation by the end of the day, with the firm having surged about 70 percent since March as global tech titans benefited from stay-at-home orders aimed at containing the coronavirus.

The move adds to a laundry list of issues that have ratcheted up tensions between the superpowers, including Hong Kong, Huawei and the spread of the virus.

"The US government is expected to follow up with more measures targeting Tencent," Steven Leung, at UOB Kay Hian (Hong Kong), said.

"Tencent's overseas expansion map now looks a bit uncertain, since some M&A deals, especially if its targets are based in the US, will face challenges."

WeChat, known as "weixin" or micro-message in Chinese, has grown to become ubiquitous in daily life across China since its 2011 launch and has more than a billion monthly users, who can also use it to hail rides and make payments.

The move rippled around Asian markets, with investors concerned about increasingly bitter relations between the economic titans that some fear could lead to a renewal of their painful trade war.

"This is yet another watershed moment in the US-China technology cold war," Paul Triolo, head of global technology policy at Eurasia Group, told Bloomberg.

"It shows the depth of the US concern."

Officials from both sides are due to meet next Saturday to review a trade deal signed earlier this year.

"Apart from the obvious fallout to Tencent and ByteDance, Washington DC's moves are sure to ratchet up geopolitical tensions with Beijing once again," said OANDA's Jeffrey Halley.

Chinese WeChat users fear being cut off from US friends
Beijing (AFP) Aug 7, 2020 - A US ban on the WeChat messaging platform could cut lines of communication between friends in China and America and force people to switch to a replacement, social media users said on Friday.

US President Donald Trump has announced sweeping restrictions against Chinese-owned WeChat and TikTok, signing executive orders giving Americans 45 days to stop doing business with the platforms.

Trump cited national security concerns, which also threw into doubt the US operations of WeChat's parent firm, Tencent.

WeChat is a messaging, social media, and electronic payment platform and is reported to have more than a billion users.

It is not widely used in the US, but in China it is difficult to do without it as the platform is used by nearly all businesses instead of email.

"People might lose their means of communication," Lu Yifan, a Chinese graduate who used to study in the US, told AFP.

"I think the biggest impact... would be basically losing contact with people in China.

"We didn't think there would be anything like this so we don't keep an alternative means of contact."

The 25-year-old said his circle of friends would use the coming weeks to turn to WhatsApp, SnapChat and Facebook messenger.

However, those platforms are restricted in China, so users in the communist country would need to use a VPN.

Similarly, US WeChat users might be able to access the platform using a VPN after a ban was put into place.

- 'More inconvenient' -

Social media users took to Weibo, the Chinese Twitter-like platform, to voice their concerns.

"How can overseas students contact with their families once Wechat is banned?," one wrote.

Another said: "(Chinese) people who work and study in the US are so miserable, many of them are used to using WeChat to socialize."

The hashtag #TrumpAnnoucesBanOnTikTokAndWeChat# had more than 300 million views on Weibo and 24,000 comments, while #TencentSharePlummets# had over 280 million views on the platform.

The ban could have an impact on businesses too.

Chen Zhuoyue, the general manager of a Chinese toy manufacturer, said: "If we can't use WeChat... it will be more inconvenient.

"One inconvenience is that we use WeChat to communicate with some clients and will have to use a different platform.

"People who use WeChat from abroad tend to be Chinese as well, so it is our communications with them that will become more difficult.

"We have to find a replacement and move some clients over, which might be more troublesome."

Others were less concerned by the possible ban.

Vivian Huang, who works in China but whose boyfriend is currently living in the US, said: "First of all it would be inconvenient for us to chat, of course.

"But on the other hand it's not just WeChat that we can use for communication, so there're still other ways like iMessage we can switch to instead of WeChat."

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