When Defense Department officials released a list of companies it claimed were linked to Chinese military activity back in June, they didn’t provide much explanation or evidence. Naturally, some of the companies on the list protested, claiming unfair treatment and no involvement with the Chinese government. So who is right?
An analysis from data analytics company Babel Street released on Tuesday shows that those companies not only have multiple links to the Chinese government but they also serve as a vehicle for expanding Chinese influence into the manufacturing sectors of other countries. What’s more, China and Russia are coordinating on investments in other countries in order to not interfere with one another, data shows.
To understand how the companies on the Defense Department list got there you have to understand how the Chinese government exercises control of technology research and manufacturing through nominally private enterprises. The companies don’t just represent a sampling of Chinese technology and manufacturing activity, they’re the biggest players in those industries by far precisely because the Chinese government has selected them to be that. It's an example of a two-tiered form of capitalism. If you want to open a restaurant in China or an electronics store, you’ll face plenty of competition; but “when it comes to anything that’s next-generation technology... everything seems to be very controlled by the government. There’s no competition. The government wants to have control of who talks to who,” said Andr ..
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