On Tuesday, Alibaba Group chairman Joe Tsai announced that the tech giant would restart its hiring efforts, buoyed by renewed confidence following a pivotal meeting between President Xi Jinping and prominent business leaders.

This rare meeting, which included Alibaba co-founder Jack Ma among other notable figures in the Chinese tech industry, signals a thaw in Beijing’s previously stringent approach to the sector.

Over the past four years, the industry faced significant challenges due to regulatory clampdowns that curbed corporate investment and resulted in widespread layoffs.

Analysts suggest that this meeting not only reflects policymakers’ apprehensions over the slowdown in growth of the world’s second-largest economy but also highlights U.S. efforts to curb China’s technological advancement.

Tsai expressed optimism, stating, “I think we have seen a very clear sign of business entrepreneurs becoming more confident since President Xi met with private businesses.”

During the HSBC Global Investment Summit in Hong Kong, he emphasized that the meeting served as a strong message to the business community to reinvest and increase their workforce.

Moreover, Tsai noted that Alibaba’s workforce had been on a downturn for the last 12 quarters, indicating the urgency of rekindling hiring practices.

“So I think we’ve reached the bottom, and we’re going to start to reboot and rehire,” he added, reflecting a hopeful outlook for the industry.

China’s economy has grappled with sluggish growth recently, further compounded by a debt crisis in the real estate sector and ongoing trade tensions with the United States.

These factors have led to job insecurity, heightened youth unemployment, and dampened consumer sentiment throughout the country.

However, Tsai believes that increased hiring could pave the way for positive outcomes: “Once you hire people, that gives them job security, right? Job security and income growth that will translate from business confidence into consumer confidence.”

In a separate discussion, Tsai commented on Alibaba’s significant investment in artificial intelligence, expressing concern over the scale of investments being reported in the United States.

“People are talking about $500 billion, several hundred billion dollars. I don’t think that’s entirely necessary,” he stated, adding that some investments appeared to be ahead of current demand metrics.

He raised an alert about the possibility of a bubble forming when companies begin to construct data centers without clear demand.

Despite his concerns, Tsai confirmed that Alibaba plans to invest at least 380 billion yuan (approximately $52 billion) into its cloud computing and AI infrastructure over the next three years.

In the broader market context, Hong Kong’s Hang Seng Tech Index, which includes leading tech entities like Alibaba, has surged by 24% this year. This increase has been fueled by Xi’s meeting with tech leaders and excitement surrounding innovative startups.