How the West can fight back against China’s economic espionage

Zineb Riboua

July 29, 2020

Since 2012, Chinese President Xi Jinping’s favourite catchphrase has been “the Chinese dream”. In stark contrast to the evil, capitalistic American dream, Xi’s alternative vision of progress teaches that the only route to prosperity is through rigid adherence to collectivist ideology.

The Chinese state embodies a very particular ideology. Over the last few decades, it has aggressively ramped up its economic and political capital through business and enterprise, inextricably tying itself to the economic fortunes of both developed and developing countries. It is now seeking to use the economic capital it has accumulated to force its political agenda into reality.

That is why the role of private companies in China is unparalleled. Milton Friedman defined corporate social responsibility in terms of private companies’ sole duty to make a profit, and then increase that profit. Chinese companies appear to be exempt from this rule because they interact with the state in a unique and troubling way.

The current state of the Chinese political and economic landscape is no accident. When Deng Xiaoping spoke in the 1980s of building a “socialism with Chinese characteristics”, this is probably exactly what he had in mind. The Chinese Communist party has succeeded in weaponising local market forces in such a way that it now holds all the cards in its nation’s dealings with the outside world, both political and economic, because the line between the public and the private is non-existent.

This strategy has not gone unnoticed. Thanks to the Chinese Communist party’s recent conduct – unprecedented aggression in Hong Kong, the appalling genocide of the Uyghur people and a costly unwillingness to share information relating to the coronavirus outbreak – the state of its internal affairs has come into sharp focus on the international stage.

Unsurprisingly, the hawkish US has placed itself at the forefront of counter-Chinese rhetoric. Secretary of state Mike Pompeo said recently: “We gave the Chinese Communist party and the regime itself special economic treatment, only to see the CCP insist on silence over its human rights abuses as the price of admission for Western companies entering China.”

It is becoming clear that the CCP’s plan to gain a stranglehold on the global market had been precarious for some time. The strategy relies on everyone else not asking too many questions about what the Chinese state is up to, especially when it comes to economic espionage. India, for instance, has blocked various Chinese networks and services, including the social media app TikTok, over national security concerns.

As FBI director Christopher Wray has said, China takes a “diverse and multi-layered” approach to its international economic espionage. Its intrusions range from influence in academia to direct intrusion in the democratic affairs of other countries.

In May, the FBI arrested two Chinese nationals suspected of committing fraud by secretly participating in Chinese “talent recruitment programs”. They are believed to have sought to steal the technology behind projects funded by American federal grants on behalf of the Chinese government.

The problem of Chinese interferences abroad is serious and widespread, and we have known about it for some time. In 2013, former CIA director Michael Hayden declared that he believes “the Chinese today are engaging in unrestricted espionage against the West that is comparable to the unrestricted submarine warfare waged by Imperial Germany in 1916.”

According to the US department of commerce, no less than eleven Chinese companies are “implicated in human rights violations and abuses in the implementation of the People’s Republic of China’s campaign of repression, mass arbitrary detention, forced labour, involuntary collection of biometric data and genetic analyses targeted at Muslim minority groups from the Xinjiang Uyghur Autonomous Region.”

The companies implicated include subsidiaries of the BGI Group, formerly known as the Beijing Genomics Institute, one of the world’s largest genome sequencing firms. The US government report indicates that those companies are involved in “conducting genetic analyses used to further the repression” of Uyghur Muslims. In other words, the Chinese Communist party is bringing private technology in-house to assist with its genocide.

Put simply, taking measures against the Chinese state itself – such as excluding China from trade deals and blocs, like the Trans-Pacific Partnership (TPP) – is not enough on its own. Because of how closely entwined private industry is with the state and its various misdeeds, Chinese companies must also be taken into account.

The removal of Huawei – one of those nefarious Chinese private companies that aren’t actually very private at all – from the UK’s 5G network was a vital first step, but there is still a long way to go in the restructuring of Sino-British relations.

Chinese industry, with the help of its government, has deliberately created and stoked economic and political imbalances around the world. Foreign technology firms are heavily censored within China on grounds of national security, but when other countries implement comparatively light-touch measures against Chinese state-linked companies known to have engaged in economic espionage, the CCP plays the victim.

A new chapter is beginning in Chinese political history. We are, at long last, living through the beginning of the end of the world’s subservience to the CCP. No longer will the West do business according to the terms and conditions of by far the largest totalitarian socialist regime of our time.


Written by Zineb Riboua

Zineb Riboua is a research intern at the Atlantic Council. She is the founder of the China in MENA Project.


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