By Yau Tsz Yan
As Kyrgyz President Soornbay Jennbekov pushed efforts to make the China-Kyrgyzstan-Uzbekistan Railway a reality, a private Chinese security company signed deals to protect the contested project for China Railway Group.
The 2016 Chinese embassy bombing in Bishkek heightened risk perception among the Chinese business community in Central Asia. Chinese companies operating in Kyrgyzstan since then have begun to swap out local security services for imported private Chinese security personnel.
Currently, there are relatively few Chinese private security companies in Kyrgyzstan, compared to 400 local Kyrgyz private security companies. But the some 574 Chinese enterprises in Kyrgyzstan are beginning to favor Chinese staff on their grounds over locals.
Zhongjun Junhong, a top Chinese private security service provider, branched out into Kyrgyzstan in September 2016. With 281 security personnel, a local weaponry license, and military gear brought from China, Zhongjun Junhong is quickly becoming a leader in Kyrgyzstan providing full-scale security service resembling the company formerly known as Blackwater, since 2011 operating under the name Academi.
Wu Guohua, a former People’s Liberation Army (PLA) colonel deployed in the Sino-Vietnamese War and the 1989 Tiananmen Square incident, heads Zhongjun Junhong. In less than three years, the company has secured over 20 Chinese clients in Kyrgyzstan, including China Road and Bridge, China Railway No. 5 Engineering Group, Sinohydro Bureau 16, Huawei Technologies, Guanglong precious metal refinery, and Sanmenxia Luqiao Construction Group. In particular, Zhongjun Junhong reached a deal with China Railway to safeguard its construction sites along the China-Kyrgyzstan-Uzbekistan railway in November 2018. The railway construction has been estimated to cost at least $500 million.
Chinese President Xi Jinping successfully pushed for a Sino-Kyrgyz investment and industrial cooperation working group during his recent visit to Bishkek for the Shanghai Cooperation Organization (SCO) summit. The pace of growing Chinese investments in the country shows no sign of slowing.
Running on low budgets, Chinese state-owned enterprises (SOEs) have in the past ignored security risks and were reluctant to employ private security firms. But countless acts of violence against Chinese companies worldwide have nonetheless proved the high vulnerability of Chinese investments in the absence of adequate security measures. Unable to rely on local forces in politically unstable countries, Chinese SOEs have begun to set aside security budgets and looked to Chinese private security companies.
A targeted bombing at the Afghan Pul e Khumri-Shirkhan Banda-Kunduz highway project site saw 11 Chinese workers killed and four others seriously wounded in 2004. Without any Chinese options, China Railway No. 14 had to employ U.S. Protection and Investigations (USPI) in the aftermath to safeguard its projects in the country, a move that prompted other Chinese SOEs abroad to hire American or British security experts.
In 2014 alone, the Charhar Institute estimated that Chinese SOEs spent $8 billion on security measures. Given the $50 billion in investments since 2013 in Belt and Road countries, where most have high security demands, private security is projected to be a lucrative business.
Opting for private security companies detaches the Chinese SOEs from financially empowering local military groups in politically unstable countries, as China has been accused of in Myanmar and parts of Africa.
After struggling with a decade-long dilemma between hiring local military groups or Western private security companies, Chinese companies are now switching to Chinese private security providers. Beyond language familiarity and preserving business confidentiality, the switch aims to keep funds circulating within the Chinese economy as Xi urges companies abroad to be mindful of the “new normal.” In Iraq, CNPC ditched top-tier British firm Control Risks for China Guanan in 2010, the same year China legalized private security companies.
Already present for some years in Pakistan, Iraq, the South China Sea, and a handful of African countries, China’s private security sector is expanding its operations in Central Asia, a territory with vast and vulnerable Chinese investments.
Since formalizing the Silk Road Economic Belt in 2013 — later rebranded along with the complementary maritime route as the Belt and Road Initiative (BRI) — at least five Chinese companies (TBEA, China Road and Bridge, China Huarong Energy Company, China Communications Construction, Shaanxi Coal and Chemical) have made large investments in Kyrgyzstan, each over $400 million. Mega investments include CNPC’s oil refinery and the Central Asia-China gas pipeline Line D (with a portion going through Kyrgyzstan), which total a combined value of $2 billion.
These investments are vulnerable. At almost every scale, Chinese projects in Kyrgyzstan have at one point or another run into problems with local residents. For example, in June 2011, 50 Kyrgyz road construction workers in Kemin protested against unfair pay. In 2014, protests by residents in Kara-Balta led to a temporary suspension of work at the CNPC oil refinery. A Chinese gold-processing plant was burned down by residents from Toguz-Toro in April 2018.
Chinese companies also struggle to manage their own imported workers from China. Chinese TBEA workers took a group of local Kyrgyz hostage in Kurshab in January 2013, reportedly over a stolen mobile phone. More than 100 people joined the conflict, with 18 Chinese workers injured and the remaining relocated to Osh for safety. In June 2014, 39 Chinese migrant workers took local Kyrgyz employees hostage over late pay at the Tokmak oil refinery.
On top of all this, occurrences of organized violence against Chinese nationals has been on the rise in Kyrgyzstan. Nationalist group Kyrgyz Choroloru infamously drew nationwide attention after raiding a karaoke club frequented by middle-aged Chinese businessmen in January 2015, claiming to have been backed by the Kyrgyz Ministry of Foreign Affairs. The group, mostly young men, gathered outside the Chinese embassy in December 2018 to protest against the “re-education camps” in Xinjiang. The next month, another anti-China protest was organized again in central Bishkek over illegal Chinese workers.
Despite many companies abroad, it was only in 2010 that China relaxed its laws to regulate and give legal status to private domestic security companies. That move came in the midst of massive structural PLA reforms that aimed to disempower the corrupted military in the country. However, with virtually no guidelines or experience with overseas operations, only the biggest players in the private security industry have risked venturing out. All backed by well-connected and trusted former military personnel, these companies have insisted that they are private and market-oriented, yet loyal to the Chinese Communist Party.
Having established a long-term consensus through the SCO against Uyghur separatists living in Central Asia, China’s anti-terrorism discourse further justifies its military footprints in the region. Two Chinese — some reports describe them as diplomats, others as businessmen — were shot dead in Bishkek in May 2000. A Chinese diplomat and a businessman were again murdered in 2002. In 2003 21 passengers — 12 of which were Chinese — were shot and killed on a bus from Bishkek to Kashgar; the bus was then set on fire. Uyghur separatists were allegedly responsible for all these incidents.
The SCO’s Regional Anti-Terrorist Center opened in 2004 in Tashkent, Uzbekistan. Bishkek had reportedly been the initial choice to host the center.
Given the high political and commercial security risks, in the absence of a legal structure governing overseas operations, uncertainty adds to worries that private Chinese security personnel may enjoy the same kind of prosecution immunity the company then known as Blackwater infamously had in Iraq.
In Kyrgyzstan, Zhongjun Junhong operates with a government-approved weapon license that does not specify a nationality restriction for weapon carriers. On paper, the Chinese Ministry of Foreign Affairs has made it illegal for private Chinese security personnel to be armed overseas, with maritime security an exception. Chinese laws have also prohibited Chinese nationals from engaging in armed conflict for profit.
China Security & Protection Group, another big player with a branch in Kyrgyzstan, works with the controversial Xinjiang Production and Construction Corps (XPCC) and donates to security departments in Xinjiang. The XPCC, or Bingtuan for short, is a business-military-governmental three-in-one organization which also owns SMTW, the first private security company in Xinjiang offering mobilized services to Kazakhstan without a foreign office. This is similar to China Security Technology Group, which offers services in Uzbekistan without a local office.
Going westward with the Belt and Road Initiative, China is set to prioritize the resource-rich Central Asia. Frontier Services Group — a logistics and security company established by Blackwater’s founder Erik Prince and listed in Hong Kong – has announced plans to expand from its operations in Africa to Kazakhstan and Uzbekistan. Given numerous threats to Chinese investments, even Western private security companies have stepped in to profit from safeguarding China’s projects in the region, and everyone is ready to serve.
Yau Tsz Yan is an Associate Research Fellow at the OSCE Academy in Bishkek and a graduate from the University of Hong Kong.
No comments:
Post a Comment