The Communist Party’s everywhere in China, even in foreign multinationals

chinese flagToday an interesting tale of ideology, back door deal making and hypocrisy as the worlds of government and hi-technology collide.

You’ve presumably all been made aware by now of the US lawmakers’ report into Huawei and ZTE which basically warns off all American firms and government bodies from purchasing their telecoms kit because of the national security risk they pose.

The key point is that the Chinese tech giants were unable to allay investigators’ concerns about the role of Communist Party committees within their firms.

The report has the following:

In essence, these Committees provide a shadow source of power and influence directing, even in subtle ways, the direction and movement of economic resources in China.

It is therefore suspicious that Huawei refuses to discuss or describe that Party Committee’s membership. Huawei similarly refuses to explain what decisions of the company are reviewed by the Party Committee, and how individuals are chosen to serve on the Party Committee.

All of which is fair enough, although virtually all Chinese companies are required to have a Communist Party committee on board, as Huawei argued to the lawmakers.

However, it has been mentioned since then that may foreign companies, including US ones, with outposts in China also have these committees. If true, it would seem to add weight to Huawei’s argument that the report reached a “pre-determined outcome”, and that its authors were unfairly harsh on the Chinese duo, even hypocritical given Party involvement in US firms in China.

Tea Leaf Nation, for example, pointed to articles claiming IBM, Nokia Siemens Networks, Standard Chartered and others all had communist bodies within them.

Now, I’ve heard back from NSN and IBM who both claimed their Chinese businesses don’t have Communist Party committees but that individual members of staff are free to join the Party if they wish.

However, I’ve yet to hear back from IBM on what  this picture and article refers to, as it seems to indicate a party branch of IBM China members.

Most likely at play here is semantics. These firms are denying having an organised party committee within their organisation, but it seems (at least in IBM’s case) they do have self-organised groups of Party members therein.

Whether this amounts to the same thing is difficult to tell, because if it’s one thing the Party is pretty good at it’s secrecy.

It has become adept over the past several decades at hiding the orchestrating role it plays at all levels of Chinese society – a role so key that it is pretty obvious if a large MNC wants doors to open for it then it needs to acknowledge and engage with the Party.


2 Comments on “The Communist Party’s everywhere in China, even in foreign multinationals”

  1. alleyeseast says:

    Nice post. There is much more going on though – the move by the US and Canada is a result of lobbying by domestic firms, just like the duties on solar panels. I have just published a connected post:

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