China Manipulating American Businesses to Serve Beijing’s Interests, House GOP Investigation Finds

June 27, 2021 Updated: June 28, 2021

The Chinese Communist Party (CCP) is manipulating American companies to help it achieve its aims of shaping public opinion, influencing government decisions, and acquiring U.S. technology, Republican lawmakers warned on June 27.

“U.S. businesses are receiving guidance and direction from Chinese officials to influence business operations, investment strategy, and strategic directions,” according to interim findings provided to The Epoch Times by lawmakers on the House Permanent Select Committee on Intelligence.

The probe also found that U.S. corporate executives and employees practiced “self-censorship,” adjusting their business strategies “due to concerns of Chinese opposition.”

Some of China’s influence came from inside U.S. companies. CCP members, either sitting on the boards or holding executive positions in American firms, are known to be “advancing China’s initiatives in acquiring technology and penetrating U.S. markets,” according to the interim findings.

The Chinese regime also is keen to get its hands on U.S. technology. According to the findings, U.S. firms have been “manipulated and/or coerced into sharing key technologies with China and helping Beijing acquire sensitive intellectual property, which benefits China-based firms at the expense of U.S. industry.”

The Chinese regime is seeking to supplant the United States as the world’s No. 1 superpower. In a speech delivered at the CCP’s 19th National Congress in October 2017, Chinese leader Xi Jinping said that China will “become a global leader in terms of composite national strength and international influence” by the middle of the 21st century.

To achieve its global hegemony, the CCP has targeted foreign academics and researchers through state-run recruitment programs, engaged in espionage and intellectual property theft, and executed a strategy known as “military–civil fusion” to help the advancement of its military by fielding technologies developed by the private sector.

Moreover, Beijing has rolled out economic blueprints, including Made in China 2025 and China Standards 2035, in an effort to transform China into a hi-tech manufacturing powerhouse.

Adm. Philip Davidson, the former head of U.S. Indo-Pacific Command, has warned about China’s global ambitions. During a congressional hearing in March, Davidson expressed concerns about how China was speeding up its “ambitions to supplant the United States and our leadership in the rules-based international order.”

The Republican lawmakers also found that Beijing had very specific reasons for seeking to influence U.S. companies. It wants American corporate leaders to “pressure local, state, and federal executives and legislatures to take actions that benefit Beijing.”

Another reason was to “suppress negative comments about China” by those working at U.S. firms. Such self-censorship was possible because China would threaten to cancel contracts with U.S. companies or deny them access to Chinese markets, according to the findings.

Apple, YouTube, Hollywood, and the NBA are among U.S. entities that have drawn criticism in recent years over their bowing to the CCP and its censorship demands. Most recently, several U.S. lawmakers, including Sens. Tom Cotton (R-Ark.), Marsha Blackburn (R-Tenn.), and Ted Cruz (R-Texas), have condemned Nike after the company’s CEO said, “Nike is a brand that is of China and for China.”

The communist regime has also taken advantage of the U.S. financial industry. According to the findings, Chinese firms raised funding in the United States to “enhance their international credibility.”

In addition, Beijing has used U.S. investment managers and banks to “gain opportunities for strategic investments in U.S. startups, innovative technologies, biosciences, and manufacturing,” the interim findings say.

Meanwhile, U.S. financial firms followed CCP guidance when they made investment decisions on China’s state-originated funds, according to the findings.

“Chinese firms use complex structures that obscure risks, state ties, and other corporate details, hindering U.S. government oversight and U.S. investors’ legal recourse in the event of fraud,” the lawmakers said.

They also pointed to U.S. dependence on China’s supply chains, including for rare-earth minerals and pharmaceuticals.

“China has articulated its understanding that its position in the U.S. supply chain could be exploited to jeopardize U.S. national security,” the lawmakers said.

Frank Fang
Frank Fang
journalist
Frank Fang is a Taiwan-based journalist. He covers news in China and Taiwan. He holds a master's degree in materials science from Tsinghua University in Taiwan.