Tech takeovers feed into China Cold War fears
Taking control
In 2017, Imagination Technologies, a Hertfordshire-based company at the cutting edge of computer-chip design, whose tech is used on iPhones, was bought by Canyon Bridge Partners, a private equity firm based in the Cayman Islands.
But 99% of the funds for the purchase came from China Reform, backed by the state in Beijing.
And this spring, Canyon Bridge Partners tried to install new directors linked to China Reform.
One of those to raise the alarm, Sir Hossein Yassaie, a former chief executive of the company, feared assurances it would not be moved to China were at risk of being broken.
"This is just part of an incremental process where technology is being moved out of the UK, and out of the West, and towards China," Mr Tugendhat says.
Has the UK been too ready to allow some of its "crown jewel" technology companies to be sold into foreign hands?
"The simple answer unfortunately is, 'Yes.'" Sir Hossein says.
Elisabeth Braw, of the Royal United Services Institute think tank, believes many other cases in which cutting edge technology have shifted to China have gone unreported.
"The UK has been late to understand this," she says.
"It sort of goes against this idea that globalisation is a force for good, if you start saying, 'Well, we need to scrutinise foreign investors.'
But actually the world has changed and China is exploiting globalisation for its own gains."
Others have already acted.
The purchase of a robotics manufacturer by a Chinese company led Germany in 2017 to place new restrictions on takeovers.
US intelligence officials have also increasingly focused on looking for a hidden hand from the Chinese state in business deals.
"You might see an acquisition and on its face it makes all the sense in the world," US National Counterintelligence and Security Center director Bill Evanina told BBC News.
"But there needs to be intelligence services peeling back that onion to identify who the backdoor owners are and who the financiers of that acquisition are."
Mr Evanina says that, after having been "a little bit slow, in the last two to three years", the US government has become more active in warning the private sector.
In the UK, MI5 plays a similar role and informs decisions about whether technology takeovers are in the national interest - but few have been stopped.
One of the more surprising rows came after the gay dating site Grindr was purchased by a Chinese company.
The US raised national security concerns because of the fear the personal data could be used to compromise or influence individuals.
And the company was eventually sold.
"The regulator realised that having that information at the disposal of the Chinese government ultimately was a very bad idea for US national security," Ms Braw says.
"We need to change our understanding of which companies are vital to national security and treat them just like we treated defence companies in the Cold War".
One concern for Mr Evanina is the extent to which China can use a combination of acquisitions, its own technology companies and cyber-espionage to build up large databases of personal information.
"The ability to have information on every human in the world that that human doesn't even have on themselves provides them with a strategic advantage, not only from an espionage perspective but a compromise perspective [and] understanding plans and intentions of companies," he says.
The New Tech Cold War will be broadcast on BBC Radio 4 at 11:00 on Friday and again on Tuesday at 16:00
Friday, April 17, 2020
BBC THIS I PREDICTED WOULD HAPPEN IF ENGINEERED CRASH GLOBAL MARKET
EU helps protect weak firms from foreign takeovers
This article above is really mostly about China and other Asian attacker states...........
Sunday, March 22, 2020
WHAT IS THE WEST DOING AND WHAT IS CHINA DOING NOW?
I am just going to take a guess, based on the past.
I am just grabbing this shit out of my ass! (cf. Randy Fertel, improv)
Traditionally, with a recession, or a depression, the West , short term profit driven, radically disinvests, cuts to the bone, cannibalism really!
(In the third world, in a downturn, they sell themselves and their children into slavery!)
(In the third world, in a downturn, they sell themselves and their children into slavery!)
It sells off assets, lays off starving workers, goes out of business permanently, commits suicide en masse, things like that.
What, on the other hand, have attacker states like Japan and China done, under conditions of recession, especially recession, stagnation, and stagflation, in the West?
They put on capacity.
They buy raw materials in large longterm contracts at fire sale prices.
They buy civil and military plant and equipment when available for a song if possible.
They buy distressed Western companies and Western assets for a song, and try to get a controlling interest where possible.
This would be an opportunity, if nothing else, and all else being equal, for them to consolidate their dominance in many areas of global production and supply.
This would be an opportunity, if nothing else, and all else being equal, for them to consolidate their dominance in many areas of global production and supply.
Sunday, September 1, 2019
PUTTING ON CAPACITY AGAINST RETARDS
Friday, August 16, 2019
KRUGMAN 101
Maybe this is just Part One, for his article for today......
He says, three rules, stock mkt not economy, X3.
Those are his guidelines for you. it's one rule.
Then, oh, shit, the bond market is the economy.
That is not one of his three rules, folks.
It is also not rule 4.
Maybe it is symmetrical: The economy is the bond market.
Very few Americans ever knew that, assuming that it is a fact, for a moment.
He doesn't say what it is, but it looks like a very very simple, Mickey Mouse, equation, only not in math, and maybe not even in grammar.
Let's suppose it is some kind of Wonkish Krugman Pretzel Logic.
I would like to say he is uttering what some logicians have called a tautology, but I am not sure even of that.
Then, he finally admits, realizing what I have told you from the first month of Trump's Presidency:
Trump, against all odds, it seems to me, is dead serious about protectionism and tariffs.
This is a breath of fresh air before the end, for me. Go out swinging.
Krugman is right about what timid short term profit driven American firms do, when tariffs hit foreign made inputs, most of what they now have to have from abroad to just even continue now as a going concern:
They disinvest further!
Krugman is right about that. Some things are true even if Krugman believes and says them; similarly for Trump, according to Thomas L Friedman, who is partly right , but whose reasoning conceals a fallacy or two or three.
What have attacker states done, when they see a whiff of American protectionism or tariff protection initiatives, or trade war saber rattling?
THEY FUCKING PUT ON MORE CHEAP CAPACITY!
Why? I will let you think about that.
Remember that Krugman talks about his tautology implicating a recession.
Six out of six sounds so much like an iron law of nature, of mathematics, and of logic, that it could substitute for a tautology, or a categorical imperative.
This post is dedicated to Gabor Steingart, The War For Wealth.
This post is dedicated to Gabor Steingart, The War For Wealth.
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