The amendment passed by China's top legislative body on Wednesday comes as Chinese President Xi Jinping places a greater focus on national security. Since coming to power in power, Xi has supervised several new steps to combat perceived dangers within and outside China and efforts to regulate the flow of information outside the nation, particularly after the Covid outbreak.
Yasuhiro Matsuda, an international relations professor at the University of Tokyo, told CNN that the revised counter-espionage law could heighten risks for foreigners and businesses trying to understand China better.
Foreign Concerns and China's Counter
Many analysts believe that legitimate data on the Chinese economy might all fall under the purview of the amended law. They also believe the tighter anti-espionage law will further frighten international corporations working in China.
The new counter-espionage law comes only months after China eased pandemic-era border restrictions after three years of self-imposed Covid isolation — measures that had kept most international entrepreneurs and researchers at bay.
However, Global Times, the English-language mouthpiece of the Communist Party of China, commented that the updated anti-spying law will have no effect on Western businesses and the continuously improving business environment in China. It urged the companies not to buy into the 'distorted facts' that China's anti-espionage law will undermine the business environment, as they will only miss opportunities and hand over development opportunities to competitors.
Despite the Chinese mouthpiece's argument, Western businesses are on the edge — and for good reason.
US consultancy Bain & Company said on Thursday that some members of the staff at its Shanghai office have been questioned by the local police. This incident comes just a month after the Beijing office of Mintz Group, an American corporate due diligence firm, was closed and five members of its staff were detained.