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Illustration: Annelise Capossela/Axios

Chinese Communist Party Secretary Xi Jinping announced last week that the party must strengthen its leadership over private companies, and that entrepreneurs must meet the party's needs. 

Why it matters: Xi's new announcement will increase fears that Chinese businesses may serve as a Trojan horse for the CCP.

What's happening: On Sept. 15, the CCP's top decision-making body, the Central Committee, released a memo calling for closer ties between private Chinese businesses and the United Front Work Department, which is the CCP's bureau in charge of extending its influence and control to all corners of society.

  • The guidelines say the aim is to "create a backbone team of private businesspeople who are reliable and useful at critical moments."
  • On Thursday, the party also convened the first-ever conference on strengthening ties between private businesses and the UFWD.

Between the lines: Under Xi, the party is seeking to establish control over the private sector in a way that maintains robust economic growth while allowing the government to implement long-term strategy and commandeer private sector resources when needed.

  • In 2018, China's securities regulator issued a guideline requiring listed companies to include in their articles of association a section about the party's role.
  • The party aims to accomplish not just economic goals but also political and national security goals.
  • “Xi has clearly given a strong push to the United Front system to do more and be bolder,” said Alex Joske, a China analyst at the Australian Strategic Policy Institute who has written extensively about the department.

The big picture: U.S. concerns over TikTok are based in part on the suspicion that private Chinese businesses aren't able to fend off Chinese government demands for data or other assistance.

  • Chinese law states that companies and individuals are required to hand over data and provide assistance to the government and its intelligence agencies upon request, and that they must keep any such requests a secret.
  • The new memo adds in a strong political element, suggesting some companies may now be required to assist in political goals and activities — though the specifics remain unclear.

What to watch: While this measure is directed primarily at Chinese businesses, the policy could spill over beyond its borders, since many Chinese businesses have partners, customers, or operations abroad.

  • The Chinese government already pressures companies to act in concert with official diplomatic and foreign policy goals.
  • Chinese companies have canceled contracts with foreign companies when their governments have acted against Beijing's wishes, such as earlier this month when a Chinese company suspended a $23.8 million order from Czech piano company Klaviry Petrof after a Czech government official visited Taiwan.
  • Chinese companies have also pulled ads from foreign news outlets that publish content Beijing doesn't like.

Go deeper:

Go deeper

Dec 30, 2020 - World

EU strikes investment deal with China despite forced labor concerns

European leaders meet via videoconference with Chinese President Xi Jinping to finalize the investment deal. Photo: Johanna Geron, Pool Photo via AP

The European Union on Wednesday finalized an agreement in principle on a long-delayed investment deal with China, appearing to defy resistance from within the EU and a request for consultations about "common concerns" from the incoming Biden administration.

Why it matters: The deal will open up both markets to investment and commit Beijing to ending certain unfair trading practices, strengthening economic ties between the EU and its second-largest trading partner.

Chicago releases video of fatal police shooting of 13-year-old boy

A small memorial is seen on April 15 in Chicago where 13-year-old Adam Toledo was shot and killed by a police officer in March. Photo: Kamil Krzaczynski/Getty Images

Chicago's independent police review board on Thursday released the body camera footage of an officer's fatal shooting of 13-year-old Adam Toledo on March 29.

The big picture: Tension continues to rise nationwide in response to police misconduct and racism. Thursday's footage release comes days after officer Kim Potter fatally shot Daunte Wright in a traffic stop near Minneapolis, where the trial of Derek Chauvin, a former police officer accused of murdering George Floyd, is ongoing.

3 hours ago - Podcasts

State AG candidate Jen Jordan talks Georgia's time under the microscope

Georgia has become the center of American politics, in an era wherein state issues and officials have taken on elevated national prominence.

Axios Re:Cap speaks with Georgia state Sen. Jen Jorden, a Democrat running for attorney general, about her state's time in the national spotlight, if she'd defend the voting law as AG and if Will Smith should have pulled his movie production from her state.

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