Breaking News: Shocking Arrest of Japanese Citizen in China Raises Alarming Concerns for Foreign Businesses
China's arrest of a Japanese man intensifies worries for foreign businesses operating in the country, raising concerns about the potential implications and challenges they may face
Get the latest insights on China's growing influence and its global impact by subscribing to CNN's Meanwhile in China newsletter.
Japanese officials from the Ministry of Foreign Affairs (MOFA) and the Japanese Embassy in Beijing have confirmed that a Japanese man, who was detained in March, has now been formally arrested by China.
A Japanese citizen reportedly employed at a pharmaceutical company in Tokyo has been arrested in China. This incident has the potential to increase concerns among foreign businesses operating in China, who have already been feeling more unsettled due to the crackdown on international consulting firms for national security reasons. Japanese Chief Cabinet Secretary Hirokazu Matsuno stated at a press conference on Thursday that they have confirmed the arrest and are making strong appeals to the Chinese authorities for the individual's early release. The arrested individual, who is in his 50s, was taken into custody in mid-October.
The man, an employee of Astellas Pharma, was detained in Beijing by Chinese security authorities in March. He is suspected of violating China's criminal law and anti-espionage law. NHK, the Japanese public broadcaster, reported that he has been living in China for approximately 20 years. CNN cannot independently verify this information.
Japan's Ministry of Foreign Affairs (MOFA) has chosen not to disclose the individual's identity, provide any information regarding his employer, reveal the charges leveled against him, or provide specific details about his current location. When CNN requested further information, MOFA declined to comment. On Friday, an Astellas representative informed CNN that they were in the midst of gathering additional information from MOFA and were presently unable to issue a statement.
Chinese Foreign Ministry spokesperson Mao Ning stated on Thursday that a Japanese Astella executive had been arrested on suspicion of espionage and was subjected to legal measures by the Chinese authorities. This comes after China expanded its counter-espionage law in July, raising concerns among analysts about potential legal risks and uncertainty for foreign businesses, journalists, and academics.
More concerns
In an unprecedented move, the Ministry of State Security recently created a public account on WeChat, a widely popular social messaging app in China with over 1 billion users. Since then, the ministry has been actively utilizing this platform to constantly remind the public to remain vigilant and report any suspicious activities to the authorities.Foreign companies and investors are becoming increasingly cautious due to the escalating risks in the world's second-largest economy, which include the potential for raids and detentions.
In July, the Mintz Group, a US corporate due diligence firm, was fined approximately $1.5 million by China for reportedly carrying out unauthorized statistical work in the country. Furthermore, in March, Chinese officials shut down the firm's Beijing office and apprehended five of its local staff members.
State security authorities announced in May that they had conducted raids on several offices of Capvision, an advisory network. This announcement followed a month of police questioning of employees at the Shanghai office of consultancy firm Bain. Consequently, foreign businesses have referred to this situation as a major challenge, particularly for those already facing difficulties in persuading employees to relocate to China.
According to a white paper released this year by the American Chamber of Commerce in China, 51% of survey participants reported that their preferred expatriate candidates were unwilling to relocate to the country, marking a 21% increase compared to the previous year.
Data from China's Commerce Ministry reveals that foreign direct investment (FDI) into China declined by 5.1% in the first eight months of this year compared to the same period last year.
According to data released in August by the State Administration of Foreign Exchange, direct investment liabilities, which reflect FDI in a country's balance of payments, dropped to a mere $4.9 billion between April and June. This marks the lowest quarterly amount since records began in 1998. Contributions to this report were made by CNN's Michelle Toh and Sophie Jeong in Hong Kong, as well as Mengchen Zhang in Beijing.
