Opinion | The truth about China's crackdown on US 'consultancy firms'
By Tom Fowdy
US Ambassador to China Nicholas Burns recently revealed in an interview with the CBS show "60 Minutes" that "China has raided six or seven businesses since March" last year, stating that "they've gone into American companies and shut them down and made accusations we believe are very much unwarranted." Specifically, Burns is referring to the raids China conducted on several US consultancy and due diligence firms, such as Mintz, at that time last year. Here, seven employees who are Chinese nationals were arrested and charged with espionage.
Naturally, it is the reaction of Western media and commentators to use these developments and push a narrative claiming that the Chinese state is acting in paranoia, coercion and contrary to the interests of foreign businesses (despite the US doing the same thing on a more drastic and unhinged scale), thus logically pushing the narrative "don't invest in China" because "your business is at risk" as part of a broader story about how the country is "closing up" "because of Xi Jinping" and thus every problem must rest with "the policy direction" he has taken.
Except that isn't true, and as with all media narratives, is inherently misleading. These companies are being cracked down on because they are acting contrary to China's national interests by gathering information and intelligence which is being relayed back to America and thus used to undermine the country as a whole. This is not speculation but is as clear as day. First, as has been conveniently downplayed or ignored by reports, is that the due diligence firm Mintz is being led by Randal Phillips, who was literally the head of China Operations in the CIA, a public appointment. You don't "leave" the CIA, once you have been a part of it, you always have contacts there which is why so many of their agents get analytical careers afterward.
But more to the point, what is due diligence, we might ask? Due diligence is the gathering of necessary information and background context for businesses so that they may be adequately informed to make decisions. It is a form of risk analysis, and therefore an avenue for research and by extension, intelligence. The CIA operates in a capitalist mode of operation whereby the organization is not monolithic but outsources its work to "contractors" who provide services and information, rather than everything being uniform. It will work with whosoever is best suited to providing what it needs, including even private companies.
Now of course, the US has a foreign policy right now to actively undermine Chinese supply chains, in particular by propagating allegations of forced labor, in order to incentivize businesses to flee. Where might you ask, does it get this information? The CIA must acquire sources "inside" China in order to know the environment, and its director William Burns has repeatedly stated in public that building the CIA network in China is the biggest priority of the organisation.
So why wouldn't the CIA, in these circumstances, lean on US-led business consultancy firms to gain intelligence on Chinese supply chains, technology companies, amongst other things, with the goal of providing information to the White House in order to implement sanctions dedicated to blacklisting Chinese companies, undermining supply chains and of course trying to cripple the country's technological development too? When viewed in this light, China isn't acting unreasonable at all but is becoming more secretive in response to US attempts to undermine them and protect their critical national interests from the eyes of the CIA, especially when some of their senior figures are literally operating these big consultancy firms out of America in plain sight!
Thus, what we must remember is that China hasn't changed, but rather the world has changed. The USA has chosen to pursue a relentless antagonism with China and wage a comprehensive economic and technological war of containment against it. Thus, Beijing isn't diametrically opposed to US and foreign businesses as the mainstream media opportunistically presents it as being. Rather, China is opposed to the CIA's covert attempts to infiltrate and subvert the country from the outside, which is all a bit ironic given the US will literally go as far as accusing Chinese-made cranes of "spying" on America and that is accepted as rational by the media.
The author is a well-seasoned writer and analyst with a large portfolio related to China topics, especially in the field of politics, international relations and more. He graduated with an Msc. in Chinese Studies from Oxford University in 2018.
The views do not necessarily reflect those of DotDotNews.
Read more articles by Tom Fowdy:
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