Capital Calls: Counter-espionage push impacts China Inc overseas
Concise insights on global finance.
EVERY BREATH YOU TAKE. China rolled out new anti-espionage regulations this week to prevent foreign spies from infiltrating the country’s companies. These, report state media, will entail putting pressure on businesses in sectors including “national defense, diplomacy, economy, finance and high-tech” to reduce unnecessary overseas travel, and to prepare detailed reports on trip agendas, meetings with foreigners, and so on. Staff will be required to bring burner phones and laptops when abroad. There are also concerns about Chinese nationals studying overseas.
Such paranoia will be a problem for Chinese companies competing in overseas markets; in additional to deterring travel, it will complicate retaining skilled foreign staff. Laptop maker Lenovo (0992.HK), for example, employs 52,000 people in 160 countries.
That said, China Inc now has a lot of intellectual property, trade secrets and sensitive emails worth stealing. Just because you’re paranoid doesn’t mean nobody is after you. (by Pete Sweeney)
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