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☆ Elon Musk: CEOs flock to China as risks to trade and investment rise
▼ + stars: | 2023-05-31 | by ( Michelle Toh | ) edition.cnn.com time to read: +8 min

To drum up business, Chinese leaders have urged foreign companies to invest more in the country, promising them an open and level playing field. “The interests of the United States and China are intertwined like conjoined twins,” he was quoted as saying by the foreign ministry. Over time, “there will be less trade” between China and the United States, Dimon predicted. The move was seen as retaliation for restrictions the United States has imposed on Chinese chipmakers. The interests of the United States and China are intertwined like conjoined twins.

Persons: Elon, Laxman, Jamie Dimon, Qin Gang, Tesla, Elon Musk, Musk, ”, Warren Buffett, Dimon’s, Dimon, That’s, Bain, “ who’s, ” Michael Hart, Ben Cavender, Nick Marro, Tim Cook, Cook, Marro, ‘, ” —, Sophie Jeong, Martha Zhou Organizations: Hong Kong CNN, Tesla, Starbucks, JPMorgan, Apple, Samsung, Aramco, Volkswagen, HSBC, Standard Chartered, Foreign, China's Ministry of Foreign Affairs, Reuters, China’s Foreign, Shanghai’s Communist Party, Bloomberg, Group, American Chamber of Commerce, CNN, British, of Commerce, China Market Research Group, US, Micron, Economist Intelligence Unit, “ Companies, China Development Forum Locations: Hong Kong, China, Beijing, United States, Shanghai, Taiwan, Washington, New York, American, Xinjiang

☆ China's tech feud with the US is heating up
▼ + stars: | 2023-05-21 | by ( Joe Mcdonald | Associated Press | ) www.businessinsider.com time to read: +4 min

China is clamping down on the use of computer chips from US tech giant Micron Technologies. China's government claims Micron products have unspecified "serious network security risks." It's the latest development in the United States' tech feud with China. They import more than $300 billion worth of foreign chips every year. Beijing is pouring billions of dollars into trying to accelerate chip development and reduce the need for foreign technology.

No one was present when Reuters visited the Hong Kong office of Mintz during business hours, with the doors locked and lights off. China's State Council Information Office, the Ministry of Foreign Affairs and the Hong Kong and Macau Affairs Office did not respond to Reuters requests for comment. The Hong Kong government said it did not comment on individual business decisions. Rights groups accuse Beijing of abuses against mainly Muslim Uyghurs in the western region of Xinjiang, including the mass use of forced labour. Reporting by James Pomfret in Hong Kong, Engen Than in Shanghai and Hong Kong Newsroom; Editing by Lincoln FeastOur Standards: The Thomson Reuters Trust Principles.

[1/3] The U.S. corporate due diligence firm Mintz Group's office is seen in Hong Kong, China, May 18, 2023. No one was present when Reuters visited the Hong Kong office of Mintz during business hours, with the doors locked and lights off. China's State Council Information Office, the Ministry of Foreign Affairs and the Hong Kong and Macau Affairs Office did not respond to Reuters requests for comment. The Hong Kong government said it did not comment on individual business decisions. Reporting by James Pomfret in Hong Kong, Engen Than in Shanghai and Hong Kong Newsroom; Editing by Lincoln FeastOur Standards: The Thomson Reuters Trust Principles.

☆ China's economy is growing again. So why are investors dumping stocks?
▼ + stars: | 2023-05-19 | by ( Laura He | ) edition.cnn.com time to read: +7 min

Investors trimmed their exposure to China amid economic uncertainty in the country, rising geopolitical tensions and Beijing’s crackdown on international consulting firms. The Nasdaq Golden Dragon China Index has lost more than 5% since April 18. Another concern for global investors is the country’s “fundamental investability,” he said, referring to geopolitical and Chinese policy risks. Ontario Teachers’ Pension Plan, one of the world’s largest pension funds, has closed its Hong Kong-based China equity investment team. “The more cracks appear in Western economies,” the more global investors will need to put money into Chinese assets, he added.

These consultancies thrived by providing investors - from global hedge funds to private equity firms - access to industry experts and investigators who could obtain valuable corporate information. One private credit investor who used to join Capvision's calls with "industry experts" said clients did not want to pay top dollar for easily available public information. Many China-based consultancy firms also outsourced on the ground investigations to local contractors. Even before the latest raids on consultancy firms, some due-diligence firms were warned to stay away from Xinjiang related projects, sometimes by security authorities, according to industry sources. China denies abuses in Xinjiang, a major cotton producer that also supplies much of the world's materials for solar panels.

Hong Kong CNN —China’s state security authorities raided multiple offices of international advisory firm Capvision, state media reported Monday, part of a broader crackdown on the consulting industry as Beijing tightens control over what it considers sensitive information related to national security. The consultancy firm, which is headquartered in Shanghai and New York, adds to a growing list of global consulting companies that have been ensnared in Beijing’s widening crackdown on what it perceives as national security risks. In the report, Capvision was singled out as a “leading company” in the industry. According to state security police, he downloaded 5,000 documents from his state-owned company’s internal network. The authorities said he had provided clients with six pieces of information that were classified as state secrets, CCTV said.

☆ China Confirms Campaign Against Alleged Spying by Foreign Consulting Firms
▼ + stars: | 2023-05-08 | by ( Liyan Qi | ) www.wsj.com time to read: 1 min

Police have raided corporate offices as part of China’s efforts to shield the country from foreign influence. Photo: Cfoto/Zuma PressChina’s national security agencies have uncovered espionage by local units of foreign consulting companies, according to state media, in the first official confirmation that a nationwide sweep of corporate intelligence and due diligence firms is under way. Police recently raided offices of Capvision across China, alleging the New York-based provider of expert consultations and research paid employees of state-owned companies to leak secrets, China Central Television reported Monday. The rare and detailed disclosure of such investigations came after authorities raided U.S. due diligence firm Mintz Group ’s Beijing office and detained local staff in late March. Police also questioned employees at Bain & Co. ’s office in Shanghai last month.

☆ China Confirms Campaign Against Alleged Spying by Foreign Consulting Companies
▼ + stars: | 2023-05-08 | by ( Liyan Qi | ) www.wsj.com time to read: +1 min

China is scrutinizing and pressuring Western management consultants, auditors and others that multinational companies rely on. Photo: Cfoto/Zuma PressChina’s national security agencies have uncovered espionage by local units of foreign consulting companies, according to state media, in the first official confirmation that a nationwide sweep of corporate intelligence and due diligence firms is under way. Police recently raided offices of Capvision across China, alleging the New York-based provider of expert consultations and research paid employees of state-owned companies to leak secrets, China Central Television reported Monday. The rare and detailed disclosure of such investigations came after authorities raided U.S. due diligence firm Mintz Group ’s Beijing office and detained local staff in late March. Police also questioned employees at Bain & Co. ’s office in Shanghai last month.

☆ China Raids Offices of Another Global Firm in Espionage Crackdown
▼ + stars: | 2023-05-08 | by ( David Pierson | Daisuke Wakabayashi | ) www.nytimes.com time to read: +1 min

China has targeted another global business consulting firm on national security grounds, launching an investigation of the Shanghai-based Capvision Partners as part of a broader crackdown on the industry, state media reported on Monday night. Officers raided several of the firm’s offices in China, including in Shanghai, Beijing, Suzhou and Shenzhen, state media said, explaining that the company was not “earnestly fulfilling the responsibilities and obligations” of preventing espionage. The investigation is the latest in a recent government crackdown on consulting and advisory firms, whose clients include overseas investors and foreign companies seeking information into Chinese industry. Mintz Group, an American company that specializes in corporate investigations, said in March that Chinese authorities had raided its offices, detained five of its Chinese staff and closed the branch. Last month, Bain & Company, a U.S. consulting firm, said security officials had visited its offices and questioned employees.

☆ It's riskier than ever to be a foreign business in China, as evidenced by a series of recent sanctions, detentions, and an updated anti-espionage law that has watchdogs on edge
▼ + stars: | 2023-05-08 | by ( Huileng Tan | ) www.businessinsider.com time to read: +5 min

The updated law doesn't clearly define what constitutes China's national security or interests. The new law follows a recent spate of sanctions, probes, and detentions into foreign firms in China. Even now, the terms relating to national security and interest are still "not explicitly defined," the Eurasia Group wrote. The updated law is also particularly concerning because of the recent developments surrounding foreign firms in China. China's recent crackdown on foreign businesses is spurring concernsIn April, Chinese police questioned staff at American consultancy Bain in Shanghai.

☆ Beijing expects foreigners to trust, not verify
▼ + stars: | 2023-05-05 | by ( Pete Sweeney | Thomson Reuters | Asia Economics Editor Pete Sweeney Joined Reuters Breakingviews In Hong Kong In September Previously He Served As Reuters' Chief Correspondent For China Economy | ) www.reuters.com time to read: +4 min

In recent months, Chinese investigators have detained employees of U.S. due-diligence firm Mintz Group, visited consultancy Bain & Company and suspended auditor Deloitte’s Beijing operations for three months. Security watchdogs have restricted overseas access to financial data providers like Wind Information, as well as academic database China National Knowledge Infrastructure. Local banks loaned 3.9 trillion yuan ($560 billion) in March alone while corporations issued 328 billion yuan of bonds. Besides Wind, other Chinese data providers including company databases Qichacha and TianYanCha have stopped opening to offshore users, according to three of the sources. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

☆ Foreign Firms in China Squeezed by U.S. Disclosure Demands, Beijing’s Security Clampdown
▼ + stars: | 2023-05-04 | by ( Elaine Yu | Dan Strumpf | ) www.wsj.com time to read: 1 min

Mintz Group’s Beijing office was raided by authorities, who detained five of the company’s workers. Photo: greg baker/Agence France-Presse/Getty ImagesHONG KONG—Foreign companies in China are walking a tightrope between their need for business intelligence to comply with proliferating U.S. sanctions and mounting concerns about the risks of carrying out the due diligence required for business on the ground. Authorities recently questioned staff at consulting firm Bain & Co.’s Shanghai office and detained the Beijing-based workers for U.S. due-diligence company Mintz Group. The news has put companies that conduct due diligence and business intelligence in China on heightened alert, with details about the visits scant and uncertainty swirling around what triggered them.

But a drumbeat of government security measures, including a broadening of counterespionage laws, and unannounced visits by investigators to the Chinese offices of several foreign firms have sent a shiver of worry that under Xi Jinping, economic pragmatism could again give way to a heightened focus on state control. International consulting and advisory firms are among those that have faced questioning from Chinese security officers in recent weeks, adding to fears among foreign investors that the authorities may be trying to choke off their access to unvarnished information about markets, competitors and potential deals in China. The scrutiny has left some companies questioning whether their China operations are at risk. Officers visited the Shanghai office of Bain & Company, a major American consulting firm, and questioned employees, Bain said in late April. And the Mintz Group, an American company specializing in corporate investigations, said in late March that officials visited its Beijing office and detained five Chinese employees.

HONG KONG, May 4 (Reuters) - China's biggest financial data provider Wind Information Co told some customers late last year that it was restricting offshore users from accessing certain business and economic data as a result of the cybersecurity regulator's new data rules, two sources said. Restricted access to Wind by offshore users comes as China sharpens its focus on data usage and security amid rising geopolitical tensions and concerns about privacy in the world's second-largest economy. A Wind salesperson told the source in September the company had made the changes as per instructions from the Cyberspace Administration of China (CAC), which asked it to stop providing offshore users with certain data. The restrictions on offshore users' access to certain Wind data have expanded since last September, said the first source. Reuters has reported, citing sources that Chinese data providers including company databases Qichacha, partially owned by Wind, and TianYanCha have stopped opening to offshore users for at least months.

Ambassador to China Nicholas Burns said on Tuesday Washington was very concerned about China's recent "punitive" action toward some U.S. companies, and that foreign firms are delaying investments in the country due to uncertainty about the openness of its economy. "If you put that together with some of the punitive actions that the government here in Beijing has taken against several American companies recently, we're very concerned about this," Burns said, adding: "We intend to have a full discussion with the government here about it." China's foreign ministry said at the time Mintz was suspected of engaging in unlawful business operations. Burns said a lot of foreign firms were delaying making major investments until they could see some consistency in messaging from China. He said he had warned American companies to carefully abide by a U.S. law that prohibits importing goods from China's Xinjiang region over concerns about forced labor by Uyghurs and other Muslim ethnic minorities.

"Since Xi Jinping took power in 2012, China has expanded the legal landscape for exit bans and increasingly used them, sometimes outside legal justification," the Safeguard Defenders report reads. Attention on the exit bans comes as China-U.S. tensions have risen over trade and security disputes. The Reuters analysis of records on exit bans, from China's Supreme Court database, shows an eight-fold increase in cases mentioning bans between 2016 and 2022. Most of the cases in the database referring to exit bans are civil, not criminal. Some activists say the wider use of exit bans reflects tighter security measures under President Xi.

☆ US Chamber of Commerce warns of major increase in risks for businesses in China
▼ + stars: | 2023-05-01 | by ( Michelle Toh | ) edition.cnn.com time to read: +2 min

Hong Kong CNN —The United States Chamber of Commerce has warned that rising scrutiny of American firms in China “dramatically increases” the uncertainties and risks of doing business in the country. “The services these firms provide are fundamental to establishing investor confidence in any market, including China,” the chamber said in a statement, without naming either company. Suzanne Clark, president and chief executive officer of the US Chamber of Commerce, speaking during an event in Ottawa, Canada, in April. The news came a month after Chinese authorities closed the Beijing offices of Mintz, detaining five of its local staff. The news about Bain has spooked the US business community in China, the American Chamber of Commerce in China told CNN last week.

☆ Beijing’s Bain Raid, Espionage Law Are Self-Sabotage
▼ + stars: | 2023-04-28 | by ( Nathaniel Taplin | ) www.wsj.com time to read: 1 min

It’s Party time. Photo: Ng Han Guan/Associated PressChina’s economy is bouncing back quicker than expected. So, unfortunately, are the sort of heavy-handed policies that spooked investors during China’s last big expansion in 2021. On Wednesday China updated its counterespionage statute to cover all “documents, data, materials or items related to national security,” a considerably wider remit than the previous “state secrets and intelligence.” Recent weeks have also brought a raid of Bain & Co.’s Shanghai offices, the detention of Beijing staff at New York-based due diligence firm Mintz Group, and the arrest of a Japanese pharmaceuticals employee for alleged spying.

☆ U.S. Consulting Firm Is the Latest Target of a Chinese Crackdown
▼ + stars: | 2023-04-27 | by ( Daisuke Wakabayashi | Keith Bradsher | ) www.nytimes.com time to read: +1 min

In the latest official scrutiny of a prominent American business in China, the authorities visited the Shanghai offices of the U.S. management consulting firm Bain & Company this month to question its employees. The questioning at Bain came less than a month after the authorities detained five Chinese nationals working in Beijing for the Mintz Group, an American consulting company with 18 offices around the world, and closed the branch. The five Chinese nationals were held overnight before their families were notified that they had been detained. China’s foreign ministry later said that the company was suspected of engaging in unlawful business operations. Mintz had no immediate response on Thursday to a request for comment on whether any of its five employees had been released.

The revision is likely to heighten concerns of foreign individuals, such as academic researchers or journalists, and businesses about visiting or operating in China. “Something like a local government budget you could broadly define as relating to national security, or even food security,” he said. “Researchers definitely need to be careful.”China says its laws related to national security and espionage are meant to safeguard the country. “Even with this amendment we still don’t understand what kind of document constitutes a national security issue,” he added. Chinese authorities did not offer details about both cases, including the reason for the crackdown, but analysts say the move is likely to further spook foreign businesses operating in China.

☆ Chinese police query Bain's Shanghai office staff - company spokesperson
▼ + stars: | 2023-04-26 | by ( ) www.reuters.com time to read: +2 min

April 26 (Reuters) - Chinese police have visited U.S. management consultancy Bain & Company's office in Shanghai and questioned staff there, a company spokesperson said on Wednesday without elaborating. "We are cooperating as appropriate with the Chinese authorities," the spokesperson told Reuters by email. The U.S. embassy in China and the American Chamber of Commerce in Shanghai did not immediately respond to requests for comment. American companies worry that China may be stepping up retaliatory action because of measures taken against Chinese firms by U.S. President Joe Biden's administration. Chinese authorities last month raided the office of U.S. corporate due diligence firm Mintz Group in Beijing and detained five local staff.

☆ China reluctantly keeps sanctions powder dry
▼ + stars: | 2023-04-12 | by ( Pete Sweeney | Thomson Reuters | Asia Economics Editor Pete Sweeney Joined Reuters Breakingviews In Hong Kong In September Previously He Served As Reuters' Chief Correspondent For China Economy | ) www.reuters.com time to read: +4 min

Yet most trade measures Xi has taken so far are best seen as defensive tactics to protect market share from aspirant rivals in the West and India. The easiest option is picking on America’s $120-billion-plus of direct investment stock in China. Of course, that is no way for China to revive the decaying quantity and quality of the investment it receives. Chinese officials consistently say they welcome U.S. trade and investment and there is no reason to doubt them. The move comes after the United States implemented multiple restrictions on sales of chipmaking tools and components to China.

☆ Micron Technology: China probes US chip maker for cybersecurity risks as tech tension escalates
▼ + stars: | 2023-04-03 | by ( Laura He | ) edition.cnn.com time to read: +3 min

Hong Kong CNN —China has launched a cybersecurity probe into Micron Technology, one of America’s largest memory chip makers, in apparent retaliation after US allies in Asia and Europe announced new restrictions on the sale of key technology to Beijing. The Cyberspace Administration of China (CAC) will review products sold by Micron in the country, according to a statement by the watchdog late on Friday. Last month, the Netherlands also unveiled new restrictions on overseas sales of semiconductor technology, citing the need to protect national security. In October, the United States banned Chinese companies from buying advanced chips and chipmaking equipment without a license. “The Chinese government may restrict us from participating in the China market or may prevent us from competing effectively with Chinese companies,” it said last week.

☆ Chinese Authorities Raid Office of U.S. Investigations Firm Mintz Group
▼ + stars: | 2023-03-24 | by ( James T. Areddy | ) www.wsj.com time to read: 1 min

The closed office of the Mintz Group in a Beijing office building on Friday. The due diligence firm said five Chinese nationals employed in the office were detained without notice. NEW YORK—Authorities this week raided the Beijing offices of Mintz Group, detaining all five of the New York-based due diligence company’s staff members in mainland China, an incident likely to unnerve global businesses operating in the country. The move comes as the heads of multinational companies including Apple Inc. and Pfizer Inc. are due to arrive in Beijing to meet with top Chinese officials. This weekend’s China Development Forum will be the first to be held fully in-person since the Covid-19 pandemic broke out, and is just weeks after Beijing installed a slate of new government leaders as it signals fresh efforts to boost foreign investment.

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