Abstract
The unprecedented amount of Chinese funds dedicated to the Belt and Road Initiative (BRI) and Beijing’s win-win vision of global connectivity and development is going to face a harsh reality that encompasses a wide threat spectrum. Chinese corporations just started to acknowledge that the risks associated with outbound foreign direct investments carries a higher failure rate due to intertwined factors such as: economic crises, conflict, civil unrest, assets nationalization and currency devaluation, just to name a few. In several cases, the Chinese State-Owned Enterprises’ (SOEs) infrastructural projects, macro size and breakneck implementation speed catalyze crisis in the already unstable socio-political environments. The solution to political and criminal violence’s spillovers along the BRI requests a broader involvement that also encompasses the Chinese insurance and private security sectors.
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Notes
- 1.
Fen Fa You Wei: ‘The key difference between the KLP and the SFA is that the former focuses on economic gains and the latter seeks to strengthen political support’. Yan Xuetong ‘From Keeping a Low Profile to Striving for Achievement’ The Chinese Journal of International Politics 2014.
- 2.
Tao Guang Yang Hui: ‘Xiaoping’s proposal, which he reads as meaning “observe calmly, secure our position, cope with affairs calmly, hide our capacities and bide our time, be good at maintaining a low profile, and never claim leadership.” Global Times June 15, 2011 http://www.globaltimes.cn/content/661734.shtml.
- 3.
China Daily ‘Xi vows Belt, Road support’, May 15, 2017 http://www.chinadaily.com.cn/china/2017-05/15/content_29343505.htm.
- 4.
China Daily ‘List of Deliverables of the Belt and Road Forum for International Cooperation’, May 16, 2017 http://www.chinadaily.com.cn/china/2017-05/16/content_29359377.htm.
- 5.
Reuters ‘Islamic State says it killed two Chinese teachers kidnapped in Pakistan’, June 8, 2017 http://www.reuters.com/article/us-pakistan-china-islamic-state-idUSKBN18Z20O.
- 6.
Aljazeera ‘Bomb attack kills at least 25 in Pakistan’s Balochistan’ May 13, 2017 http://www.aljazeera.com/news/2017/05/blast-kills-pakistan-balochistan-170512095736342.html.
- 7.
Pakistan Forward B’aloch Liberation Army guns down 10 construction workers in Gwadar’ May 15, 2017 http://pakistan.asia-news.com/en_GB/articles/cnmi_pf/newsbriefs/2017/05/15/newsbrief-02.
- 8.
South China Morning Post ‘China, India border dispute bubbles over once more, but no one is quite sure why. Experts unsure why Chinese road construction project at tri-junction with Bhutan sparks huge military stand-off, but incident shows tensions remain high’, July 3, 2017 http://www.scmp.com/news/china/diplomacy-defence/article/2100871/china-india-border-dispute-bubbles-over-once-more-no.
- 9.
‘K&R… a market worth about $250m in 2006 doubled in size by 2011…’ from The Economist; Schumpeter Business and Management ‘Kidnap and Ransom Insurance. I’m a client … get me out of here.’ June 27, 2013 http://www.economist.com/blogs/schumpeter/2013/06/kidnap-and-ransom-insurance?fsrc=rss.
- 10.
China’s ‘New Normal’ defines the transition from accelerated economic development of two-digit GDP increase in the last three decades and a slower but steady economic development focused on 6–7% GDP growth per year.
- 11.
After 54 consecutive months of year-on-year falls, the producer price index (PPI) rose 0.1% year-on-year in the month, according to the National Bureau of Statistics (NBS) October 14, 2016.
- 12.
Author interview with the Chinese Contractors Association managers, Beijing September 2016.
- 13.
China Daily ‘Key part of Pakistan economic corridor opens up’ November 15, 2016.
- 14.
‘Soon we’ll start hiring 700–800 police to be part of a separate security unit dedicated to Chinese security, and at a later stage a new security division would be formed’, Jafer Khan, regional police officer in Gwadar told Reuters.
Syed Raza Hassan ‘To protect Chinese investment, Pakistan military leaves little to chance’ Reuters January 26, 2016 http://www.reuters.com/article/pakistan-china-security-gwadar-idUSKCN0VH06F.
- 15.
Interview with Control Risks Partner Michael Humphreys, November 2016 Shanghai.
- 16.
United States Central Command reported in January 2015 that 54,700 private contractors worked for the Defense Department in its areas of responsibility. http://www.acq.osd.mil/log/PS/reports/CENTCOM%20Census%20Reports/5A_January2015.pdf.
- 17.
Regulation on the Administration of Use of Guns by Full-time Guards and Escorts Decree adopted in 2002 via No.356 of the State Council of the People’s Republic of China, English translation http://www.lawinfochina.com/Display.aspx?lib=law&Cgid=40814.
- 18.
Regulation on the Administration of Security and Guarding Services, adopted in 2009 via State Council Order No. 564, Article 1. English translation http://www.lawinfochina.com/display.aspx?lib=law&id=7779.
- 19.
Frontier Services Group Limited, previously known as DVN (Holdings) Limited (HKSE: 00500), China investment bank CITIC Group is one of the major shareholders. ‘Security and logistics services in frontier markets. We help businesses operating in frontier markets overcome complex security, logistics and operational challenges. From Asia to Africa, FSG delivers reliable, bespoke and fully integrated project logistics solutions that cover air, sea and ground transport.’
- 20.
Author interview with Chinese PSC managers in Beijing during the preparation of ‘Security Privatisation with Chinese Characteristics: The Role of Chinese Private Security Corporations in Protecting Chinese Outbound Investments and Citizens’ IDSS/RSIS China Programme 30 June 2015 https://www.rsis.edu.sg/rsis-publication/idss/security-privatisation/#.WRZrXBOGNAY.
- 21.
Interview with Dr. Jianming Mei, Director Research Center for Counterterrorism, People’s Public Security University of China in Beijing, February 2017.
- 22.
Author’s interviews with retired Singapore Military attaché and former Singapore police force expert in K&R .
- 23.
China Daily ‘Xi: Integrate military and civil sectors’ June 21, 2017 http://www.chinadaily.com.cn/china/2017-06/21/content_29822602.htm.
- 24.
Circular n16 (2006) Circular n225 (2008), Circular n16 ‘Interim measures for the supervision and administration of overseas State-owned assets of central State-owned Enterprises’ (2011).
- 25.
Author’s interview with Western security companies top management in Shanghai and Singapore.
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Arduino, A. (2018). China’s Belt and Road Security: The Increasing Role of Insurance and Private Security Companies. In: Arduino, A., Gong, X. (eds) Securing the Belt and Road Initiative. Palgrave, Singapore. https://doi.org/10.1007/978-981-10-7116-4_3
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