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SECTION 7

Corporations

American corporations wield significant political influence domestically and are some of the most significant sources of American soft power abroad. Foreign leverage over American corporations can thus advance important strategic interests of the country in question. In addition, as Chinese corporations go abroad, they, too, bring with them the potential of being leveraged by the Chinese government to advance China’s interests. This section examines improper influence in the US corporate sector, as well as the potential for future influence because of significant economic exposure to China.

The US-China economic relationship is large and multifaceted. Trade statistics illustrate just one aspect of this tangled web: In 2017, the United States exported goods worth $130 billion to China, while importing goods worth $505 billion.¹ With trade also comes extensive foreign investment, as well as significant levels of employment of each country’s citizens. Since 2000, the cumulative value of Chinese foreign direct investment (FDI) in the United States has exceeded $140 billion, with US investment in China being more than double that amount.² In the United States, there is more Chinese investment in the real estate sector than any other area. But until recently more deals are being done in the information technology sector, which has attracted the growing attention of the Committee on Foreign Investment in the United States (CFIUS).

China is increasingly willing to engage in aggressive forms of economic statecraft.³ This includes not just denial of access to, or harassment in, China’s own market, but also targeting of other countries’ domestic economies and companies. These actions are sometimes state-led; at other times China’s state-run media will encourage “consumer-led” boycotts (as in the cases of Japan, Norway, and South Korea, among others).⁴ Chinese corporations abroad are all well aware of Chinese official policy and understand the value of acting in support of their country’s foreign or industrial policy objectives. China’s growing commercial presence in other countries’ economies strengthens its ability to potentially influence their politics.

This section examines corporate sector influence through three lenses: (1) the use of business-related United Front organizations in the United States; (2) Chinese companies operating in America; and (3) Chinese pressuring and manipulation of American companies as vectors of influence. All three approaches are cause for concern, yet the pressuring manipulation of American corporations has generally attracted less attention.

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