This analysis was first published in SvD Näringsliv, in Swedish, on October 15th, 2021.

There used to be only one realistic way into China for a foreign company. Now even that may be closed. As LinkedIn dismantles its social network in the country, it could mark a new era for tech companies in China.

The accepted wisdom has long been that the only way to enter China as a foreign company is through partnerships. Local legislation and the relationship with the Chinese state simply require some form of Chinese co-ownership. But play those cards right and an enormous market opens up.

That was the pitch for LinkedIn too, when it launched in China in 2014. The Microsoft-owned social network had partnered with venture capital firms China Broadband Capital and a Chinese arm of Sequoia Capital for precisely this reason. Which makes it striking that LinkedIn has now announced it is shutting down the part of its service where users can post articles and updates. It looks like the relationship with the state was, after all, not enough to keep the operation going.

Earlier in the month, reports had already emerged that LinkedIn had begun removing content from journalists who cover China. A reporter at the news site Axios got a notice from LinkedIn saying that “your profile and public activity, such as your comments and the links that you share with your network, will not be visible in China”. Exactly which material was being referenced wasn’t specified, but the common thread was that the notice went to journalists who had been covering China — and who had, in the process, sometimes been critical of the country.

The theory that this is about the expression of inconvenient opinions is supported by the fact that LinkedIn is keeping some operations in the country, but through a newly launched app focused on job listings. The company itself is not banned from China – it’s only one specific part of the operation that can no longer be run there. LinkedIn’s own framing is that it has become a “significantly more challenging operating environment and greater compliance requirements in China”.

LinkedIn isn’t alone in this “challenging environment”. The entire Chinese tutoring industry was wiped out almost overnight after the state decided it was not appropriate for anyone to make money from it. This week the industry got a small reprieve, with those companies now allowed to assist with vocational training at least. The point is to fit in as a piece in the modern China that Xi Jinping wants to build. And those swings can come fast – even for the companies that are on the inside.

The picture being painted is a China that is closing in on itself. The intense pressure put on the domestic tech companies has drawn the world’s attention and pushed share prices down. When even established foreign companies – which followed the playbook – are now being forced to rethink their operations, that may add to the uncertainty for global investors.

If not even the world’s second most valuable tech company, Microsoft, can navigate the political landscape – what hope is there for everyone else?