The United States and China are negotiating a bilateral investment treaty. Economic issues come up regularly in the annual Strategic and Economic Dialogue. However, while car tires and chicken meat get the attention of American trade officials, certain Chinese actions with dire consequences for a particular sector in the United States somehow don’t seem to get discussed as economic issues.
On June 29 last year, Bloomberg News reported that relatives of Xi Jinping, now China’s President, controlled assets valued at more than US$500 million. The Bloomberg article made it clear that no assets were traced to Xi himself, his wife or their daughter and said there was “no indication Xi intervened to advance his relatives’ business transactions, or of any wrongdoing by Xi or his extended family.”
That same day, Bloomberg’s websites in China were blocked, denying access to web content and also affecting the advertising revenue.
A few months later, on Oct. 25, The New York Times published an article about then prime minister Wen Jiabao, suggesting that his relatives “controlled assets worth at least $2.7 billion.”
English and Chinese-language websites of the paper were immediately blocked. The Bloomberg and Times websites remain blocked even today.
This, of course, is an example of China’s lack of press freedom. But it is also a direct economic blow to the ability of these media companies to derive income from their business.
Chinese financial institutions have reportedly been told by officials not to buy Bloomberg terminals.
As for The Times, its Chinese-language website, launched in June 2012 to target “educated, affluent global citizens” in China, was strangled in the cradle.
Moreover, neither news organization has received residency visas from China for new journalists.
The Times reported last week that Bloomberg News was curbing “articles that might anger China” and that “Bloomberg’s operations in China have suffered” since its article about the Xi family and “sales of its financial terminals to state enterprises have slowed.”
The article acknowledged that other news organizations, including The Times, “have come under similar pressure.”
Such pressure certainly reflects the lack of press freedom in China. The general attitude seems to be that the Chinese actions, while deplorable, must be accepted as a fact of life.
But these actions also show how the US media sector operating in China is subject to pressures that Chinese media organizations operating in the United States simply don’t have to contend with. Washington has not insisted on reciprocity where news media are concerned even though American law says the US will issue journalist visas on the basis of reciprocity.
China operates under the principle that foreigners in China should observe Chinese rules and regulations and Chinese living and working overseas should observe foreign laws.
Thus, Chinese are free to do things overseas that foreigners are not allowed to do in China but that, according to Chinese reasoning, is only fair because each side establishes its own rules. Just as Beijing doesn’t insist on press freedom in the United States, so Washington should not interfere in Chinese internal affairs by asking for press freedom in China.
This line of reasoning results, for example, in a lack of reciprocity where investment is concerned.
In 2005, China attempted to take over the American oil company Unocal but failed. Earlier this year, CNOOC Ltd. successfully acquired Nexen, a Canadian oil and gas company. But under Chinese law foreign companies aren’t allowed to take over Chinese oil companies.
This lack of reciprocity is likely to be tackled during negotiations on a bilateral investment treaty. However, Washington shouldn’t overlook the unfair competition in the media sector.
China is withholding visas not only from Bloomberg and The New York Times. Only days ago, it informed Reuters that Paul Mooney, an American journalist who has been waiting for eight months, would not be granted a resident journalist visa. The Chinese Foreign Ministry did not give a reason but Mooney is known for his persistent coverage of human rights abuses in China.
While Bloomberg and New York Times reporters wait for months for a China visa, the United States routinely grants visas to employees of Chinese party and state-controlled media organizations such as Xinhua, the People’s Daily or CCTV.
It is about time Beijing – and Washington – recognized that such actions as denials of visas and blocking of websites amount to trade violations. The inability to report effectively in China – the biggest political and economic story in the world – makes the US media uncompetitive and is much more than lack of press freedom in China. It affects the survival of a key sector of the American economy.
Frank Ching opened The Wall Street Journal’s Bureau in China in 1979. He is now a Hong Kong-based writer on Chinese affairs.
[email protected]; Twitter: @FrankChing1