China has raided seven American Business in Beijing
- In a fresh interview on Sunday, the US ambassador in Beijing revealed the total.
- China has cracked restrictions on international enterprises while it pursues investment.
- Bain & Co, Mintz Group, and Captivision were among the US firms targeted.
The Chinese government has raided up to seven US companies operating in China during the last year on suspicion of espionage, according to America’s ambassador to Beijing.
According to the US ambassador to Beijing, the Chinese government has raided up to seven US businesses operating there in the last year on suspicion of espionage.
In an interview with 60 Minutes that aired on Sunday, US ambassador Nicholas Burns disclosed the amount, indicating a concerning trend for Americans looking to do business in China.
They declare, “We’re open for business,” on the one hand. Here, we want American and Japanese companies.” However, since last March, they have broken into six or seven American companies, according to Burns.
He said, “They’ve targeted American businesses, shut them down, and made accusations that we feel are completely unfounded.”
Although some raids on US firms in China had previously been publicized, Burns’ figure is larger than what was previously known.
Last year, China initiated a crackdown on US consultant and due diligence services, which industry groups say alarmed foreign investors in the world’s second-largest economy.
In March, the Beijing office of US consulting Mintz Group was raided, and five Chinese employees were imprisoned.
Mintz confirmed the incarceration of its workers and the closing of its China company in a statement issued during the raid, and was later fined $1.5 million by Beijing authorities.
In March, the Beijing office of US consulting Mintz Group was raided, and five Chinese employees were imprisoned.
Mintz confirmed the incarceration of its workers and the closing of its China company in a statement issued during the raid, and was later fined $1.5 million by Beijing authorities.
In April, Chinese police swooped on the Shanghai office of US management consulting firm Bain & Co.
Bain confirmed the raid on its Shanghai headquarters in a statement at the time, but provided no other details.
Then, in May, China’s state television broadcast a program depicting a raid on consultancy Capvision Partners’ premises, defying the crackdown for everyone to see.
Capvision said in a statement shortly after the broadcast that it would follow national security regulations, but declined to speak further.
China amended its counter-espionage law in July, much to the dismay of the United States, with wide-ranging changes that included prohibiting the transfer of any material related to national security and widening the definition of spying.
‘It’s written in such a broad way that American businesspeople may be charged of espionage for engaging in practices that are entirely lawful and acceptable elsewhere in the world,’ Burns said of the new counter-espionage statute.
He stated that routine ‘due diligence’ on a company’s finances, which is used to influence investment or joint venture decisions, may be considered spying under the new rule.
‘I believe they want to dominate data about Chinese individuals and companies,’ said Burns. ‘I believe that is at the heart of the problem with those American corporations that operate in that space.’
Last year, China’s Ministry of State Security encouraged its citizens to participate in counter-espionage efforts, setting up tip lines for individuals to report suspected activities and offering to congratulate and reward them.
The ministry claimed to have discovered two nationals spying for the US Central Intelligence Agency, describing how the accused were recruited and placed them under investigation.
In June, the US National Counterintelligence and Security Center stated that China considered outbound data flows as a national security issue, and that new and current legislation might compel companies’ locally hired Chinese citizens to assist Chinese intelligence efforts.
The crackdown on alleged eavesdropping has significantly reduced foreign investment in China, which the nation desperately needs as its economy continues to lag after years of interruptions caused by draconian economic lockdowns.
China’s foreign direct investment fell 82 percent last year, to $33 billion on a net basis in 2023, according to the State Administration of Foreign Exchange.
Foreign company investment in China fell to its lowest level in 30 years, with outflows exceeding inflows by $17.5 billion in the fourth quarter, marking the first net outflow on record.
