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China Seeks to Pre-Empt Sanctions in Case of Taiwan Clash, F.B.I. Chief Says

LONDON — Learning from Russia’s invasion of Ukraine, China is looking for ways to protect its economy from the threat of international sanctions …

China Seeks to Pre-Empt Sanctions in Case of Taiwan Clash, F.B.I. Chief Says
06.07.2022 21:39
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LONDON — Learning from Russia’s invasion of Ukraine, China is looking for ways to protect its economy from the threat of international sanctions should a confrontation over Taiwan occur, “a clue” to Beijing’s view of what the future holds, the F.B.I. director said Wednesday.

Western sanctions over the war and Russian retaliation have cost Western businesses billions of dollars in Russia, and they could be caught in a similar but far bigger and more dangerous scenario should China invade Taiwan, said the director, Christopher A. Wray.

China is seeking to insulate its economy against potential sanctions, “trying to cushion themselves from harm if they do anything to draw the ire of the international community,” he said. “In our world, we call that kind of behavior a clue.”

Western business is much more deeply invested in China, which is trying to make it more difficult for foreign companies operating there to cooperate with international sanctions. If China does invade Taiwan, Mr. Wray said, companies from the United States and its allies would find themselves caught.

“Just as in Russia, Western investments built over years could become hostages, capital stranded, supply chains and relationships disrupted.” he said. “Companies caught between sanctions and Chinese law forbidding compliance with those sanctions. That is not just geopolitics, it’s business forecasting.”

The remarks came during an unusual joint address in London by Mr. Wray and Ken McCallum, director general of MI5, the British security service, warning about threats from China to U.S., British and Western businesses.

While the Biden administration has tempered some of the Trump administration’s efforts to counter Chinese espionage, Mr. Wray has continued to speak regularly about the threat China poses, as it sends out agents, makes strategic investments and launches cyberattacks aimed at stealing the intellectual property and know-how of overseas businesses and universities.

In a question-and-answer session after the speech, Mr. Wray said the Chinese government is pressuring Western businesses as aggressively as ever not to criticize Beijing or its policies, but he declined to say whether an invasion of Taiwan had become more or less likely.

“I will say that I don’t have any reason to think their interest in Taiwan has abated in any fashion,” he said. “We certainly hope that they are learning valuable lessons of what happens when you overplay your hand in a way that the Russians clearly have in Ukraine”

Some American officials have argued that failing to take a tough stand against Russia’s war on Ukraine would tempt Beijing into acting against Taiwan.

During the Trump administration, Mr. Wray was one of a series of senior national security officials delivering speeches describing China as a rising threat. But his latest speech comes as the Biden administration has been focused on the immediate threat of Russia and its invasion of Ukraine and has taken steps to change some of the Trump administration’s programs to counter China.

Earlier this year the Justice Department modified a Trump-era initiative to combat Chinese espionage, treating many cases of academics failing to disclose ties or funding from China as civil violations, not crimes. While some prosecutions had resulted in convictions, others had led to acquittal or dismissal. Officials in China have held up the initiative as an example of the United States’ hypocrisy and systemic discrimination against ethnic minorities.

On Wednesday, Mr. Wray largely steered clear of Chinese efforts to take intellectual property from American universities, instead focusing on ways Beijing uses cyberespionage and human assets to steal information and technology from Western businesses and funnel it to Chinese competitors.

“The Chinese government poses an even more serious threat to Western businesses than even many sophisticated business people realize,” Mr. Wray said.

Mr. McCallum, the MI5 director general, struck similar themes, but highlighted how China uses a patient approach, conducting coordinated influence campaigns that can last for decades.

“The most game-changing challenge we face comes from the Chinese Communist Party,” Mr. McCallum said. “It’s covertly applying pressure across the globe. This might feel abstract, but it is real and it is pressing.”

While American law enforcement and intelligence officials have been warning about the problem for years, it is a far more recent phenomenon for British security officials, who until last year made few public comments about the Chinese threat.

MI5 is running seven times more investigations involving Chinese espionage than it did in 2018, and plans to double the current number in the coming years, Mr. McCallum said.

Beijing has pushed back forcefully against U.S. warnings about a Chinese threat, calling such comments political lies that recycled old Cold War-era tropes as part of a broader attempt to contain and suppress China’s rise. Chinese officials have sought to portray economic and trade ties between the U.S. and China as mutually beneficial, with a vice foreign minister saying as recently as last November that among the over 70,000 American companies doing business in China, 97 percent were earning profits.

Mr. Wray argued that China poses a broader threat to Western politics as well as business. Some American intelligence agencies have argued that China does not try to spread chaos and dissension, or broadly disrupt the democratic process, as Russia has in recent elections, but other officials say it is important not to view China’s actions too narrowly.

On Wednesday Mr. Wray said many of China’s efforts take the form of malign campaigns to influence American policy, political candidates and public opinion, as distinct from swaying elections. But he also noted the recent case of Chinese government agents charged with trying to influence a Congressional race in New York by derailing the candidacy of a former Tiananmen Square protester. In that case federal prosecutors contend that China tried to manufacture a fake controversy with a sex worker then considered arranging for the candidate to be struck by a vehicle.

That plot, Mr. Wray said, took the threat “to a whole another level.”

Also on Wednesday, the U.S. government’s National Counterintelligence and Security Center released a new warning to government and business leaders about Chinese efforts to manipulate them to support “hidden agendas.”

Chinese officials have disputed the idea that Beijing attempts to meddle in American affairs, calling such accusations baseless and an attempt to use China as a scapegoat and distraction from the United States’ own domestic problems. The officials have held fast to the line that China supports “noninterference” in the domestic matters of sovereign countries, including elections, as a matter of principle.

While neither Mr. Wray nor Mr. McCallum would directly compare the influence threat from China to that of Russia, both made the case that Beijing works over the long term, cultivating local officials over decades.

“It’s not always the case of seeking to influence a national leader or someone a cabinet level,” Mr. McCallum said. “They are prepared to invest in cultivating people at local government level potentially at the outset of their political careers. And I think that in itself actually illustrates the breadth and the patience of this threat.”

Amy Qin in Taipei, Taiwan contributed reporting.

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