China Risk for Emerging Markets Is Hidden Behind Russia’s War

(Bloomberg) ― As traders grapple with the outbreak of war in Europe, the prospect of a new regulatory crackdown in China is getting lost in the headlines but potentially poses a larger risk to emerging-market assets.

A meltdown in Chinese technology shares after authorities told food-delivery platforms to cut their fees last month fueled bigger losses for MSCI Inc.’s Emerging Markets Index than even Russia’s invasion of Ukraine. That’s because China accounts for about 30% of the gauge, while Russia is just over 1.5%. Traders are now concerned that this week’s meeting of the National People’s Congress could precede a renewed crackdown ― even as opening remarks from Premier Li Keqiang emphasized that venture capital still has a role to play.