When documenting China’s security footprint abroad, the PLA and the PLAN often get the spotlight. But under the hood, a relatively newer force is entering many conflicts ridden zones along China’s land based and Maritime Silk Roads.

These are up and coming Private Security Companies (PSCs) that are seeking to expand out of domestic Chinese markets and capitalize on growing Chinese businesses throughout the BRI. As the BRI continues to expand into countries with a weak state and ongoing conflicts, BRI businesses need security and protection.

On the maritime front, increasing worries about sea piracy have created a demand for armed escorts for merchant ships.

As was the case in Pakistan, on ground local government forces have repeatedly failed at providing adequate protection. This is where Chinese PSCs come in. With foreign forces failing to secure BRI projects, businesses are approaching Chinese companies. China’s entry into the international Private Military and Security Company (PMSC) market marks a significant departure in a space that continues to be dominated by American and British contractors.

These westerns PMSCs have had decades to develop in the international sphere. During this tenure they have also managed to create a whirlwind of criticism around the field. It is in this space that Chinese PSCs, one of Asia’s strongest powers,are trying to leave a mark. Thus, it will be valuable to assess their scope, what they might evolve into, and their connection to the Chinese state.

The Current International Chinese PSC Landscape

Chinese Private Security Companies are a relatively new entry on the international scene. Beginning in the early 2010s, violent incidences, including abductions, killings, brawls, piracy, etc.  involving Chinese individuals in countries such as South Sudan, Pakistan, and Mali experienced an uptick causing concern in Beijing.

The wake-up call came in 2010 when separatists from the Baloch Liberation Army in Pakistan attacked the Zaver Palace Continental Hotel situated near the Gwadar Port hoping to target Chinese investors.In 2014 ten Chinese individuals working on a Cameroonian construction site run by a state owned company were kidnapped.

In 2015, Chinese citizens were kidnapped again in Nigeria and several more died in a car bomb explosion in Somalia. Beijing has responded to these concerns through two step, first by deploying the PLA and the PLAN where possible and secondly by allowing domestic security organizations to go abroad.

Allowing PSCs to operate instead of PLAN can actually be the better choice in some situations. China is acutely aware of rising international fears around the potential of a hegemonic China, especially among developing nations. In other cases, using military resources would simply be excessive. In such situations, PSCs can provide a viable middle ground alternative.

Currently there are thousands of Chinese PSCs operational within the country which are providing risk assessment services, surveillance equipment, private security, etc. Much of these functions transfer on to international operations as well. As the domestic market saturates some companies are looking abroad to expand their business. Consequently, the international footprint of Chinese PSCs is expanding.

According to work done by Tsinghua University, Beijing, the top 10 PSCs in China with an international footprint are:

    1. G4S
    2. Control Risks
    3. Beijing Dewei Security Service
    4. ZhongguoAnbao China Security Industry
    5. HuaxinZhongan (Beijing) Security Service (HXZA)
    6. Shanghai Zhongchenwei Security Service Group
    7. Beijing DingtaiAnyuan Guard & Technology Research Institute
    8. ShengzhenZhongzhouTewei Security Consultant
    9. Beijing Guanan Security & Technology
    10. Shandong Huawei Security Group

These companies represent a very minor fraction out of a range of domestic PSCs. The reason for the small footprint abroad is manifold. Legally the Chinese government poses several restrictions on domestic PSCs that make it harder to operate abroad.

The 1996 “Law of the PRC on Control of Guns” states that only the PLA, the police, and the militia can legally possess weapons and those who possess arms overseas may face imprisonment for their crime. This is clearly a significant hurdle for PSCs that wish to operate in conflict prone areas.

In a 2010 law passed by the Ministry of Commerce concerning the operation of PSCs, the government added several strict criteria for firms looking to operate abroad.

These included providing security training to their employees before sending them abroad, set up security management systems and mechanisms for emergency response. Providing security systems and training to employees of firms going abroad provides one avenue for PSCs to enter the international market.

While the 2010 law opens up some paths for PSCs looking to expand, these existing regulations still prove to be a major hurdle for all but a few PSCs. Most do not have the resources to fulfill these basic requirements and cannot afford to set up bases abroad. These concerns are reflected by the Wu Guohua, Executive Chairman of the “Overseas Security Guardians” which operates Zhong Jun Jun Hong Security Group.

He states that while since 2011 companies, small and large, have jumped at the chance to expand abroad, many smaller companies don’t have the resources to negotiate with foreign governments or local forces, educate their personnel thoroughly on local laws to the same level that bigger companies can.

Additionally, major companies that do operate abroad, like the HuaxinZhongan Security Service (HXZA) and the Zhong Jun Jun Hong, also boast a range of international certifications to bolster their bid internationally.

Many other security organizations are unable to acquire them. Thus, regulatory requirements in the future must reign in these elements and bring smaller companies into the fold as well.

Scope of Current PSC Tasks

Considering that Chinese PSCs are not permitted to carry arms abroad, PSCs often diverge into a range of other security services that do not require its personnel to be armed. These include training personnel, providing logistical assistance, serving as guards in factories, etc., and collaborating with armed local officials for providing protection to Chinese citizens abroad.

The only service where Chinese PSCs have been allowed to use arms has been while escorting Chinese vessels through water bodies like the Gulf of Aden or the straits of Malacca.

Maritime escorting is a rising field for many PSCs. Most major PSCs provide multiple, if not all, of these services. One of the largest is HuaxinZhongan(HXZA) Security Service that provides all of these above-mentioned services. HXZAis also recognized for their ability to communicate and cooperate with local authorities and PSCs for support. Another major PSC is the Overseas security Guardians Association, which is part of the Zhongjun Junhong group that operations other domestic security subsidiaries.

The association is perhaps the most explicit in its connection to the BRI. The organization aims at “safeguarding the promotion of national ’one belt, one road’ strategy” and “building the great wall of steel” to guard the “overseas economic development and the safety of oversea China-invested enterprises and compatriots”.

Maritime escorting is slowly growing as a prominent service amongst organizations. This usually involves PSCs providing protection to merchant ships or fishing vessels in piracy prone areas of the Indian Ocean and the Gulf of Aden.

While the affair is expensive, PSCs can find a relative niche for themselves in the work that sets them apart from the PLAN which frequently serves this purpose. In the Sohu Military Observer, Mr. Wu wrote that using PSCs for escorting services is often more cost effective then a PLAN deployment and PSCs tend to be better matched in force as well.

The scale of piracy is also smaller than one would expect. Most piracy operations are not large scale and involve the use of small and fast boats, and light weapons. This strength of force can be proportionally dealt with by well-armed PSCs without the need for large scale investment of troops or equipment from the navy.

Additionally, PLAN deployments carry the risk of sending a political statement, whether that was intended or not. Here too the commitments to bolstering the BRI are in both practice and rhetoric. In 2015, HXZA made headlines for escorting a Chinese sailor, Zhai Mo, who was took a 10,000 Nautical Mile journey retracing the ancient Maritime Silk Road.

These modes of engagement however are still limited due to few key restrains. Firstly, the inability of PSCs to use arms restricts their independent operations. Many organizations continue to provide logistical services.

Like stated earlier many smaller companies do not have the connections to work with local PSCs or authorities to find local forces that can help provide the muscle. HXZA is one of the few companies that has been authorized to carry arms abroad. This also puts PSC employees into severe danger themselves.

In Juba, the capital of South Sudan, Chinese security forces from DeWei Security Services found themselves stuck in an active shooting incident that was occurring between local warring factions. Unarmed and underprepared, the security workers and the employees of its client that it was sent to rescue were trapped in an insecure building awaiting government forces to evacuate them.

Secondly, PSC operatives often have limited foreign language abilities, be that inEnglish or the native language in the area of deployment. This creates a barrier between locals and the PSC which makes collaboration even harder.

In many BRI locations, local population are distrustful if not outright hostile to Chinese presence as demonstrated above. Lingual barriers can add on to this sense of division between locals and the Chinese guests in addition to posing obvious administrative difficulties.

PSCs and The Chinese State

For the longest time, the Chinese state and the domestic legal framework was not friendly to the establishment of Chinese PSCs abroad. However, over the past decade the ice has started to melt as ministries have eased legal restrictions and HXZA operatives were even allowed to carry arms.

Chinese firms will perhaps slowly but surely continue to expand into these new markets. Increasing foot print of Chinese agencies that are actively engaged in security operations, risk assessment, provision of security equipment (as in the case of HXZA) etc., brings with it concerns about their connection to the Chinese state and if they can be fully autonomous in their operations.

Many Chinese businesses, such as Huawei, have been subject to these fears thus is it logical to worry if PSCs will function as an extension of the PLA or even the Chinese state. The evidence in support for this is currently weak. PSCs are still mostly engaged in services like anti-piracy operations, resolving kidnapping incidents, guarding Chinese citizens and infrastructure abroad, etc.

This relatively narrow range of services is still quite niche and Chinese PSCs are yet to go fully mainstream. Additionally, while some successful PSCs may have connections with their domestic state clients, it may not necessarily translate into serving as an arm of the state abroad. Thus, today the verifiable connections between PSCs and the state are quite limited.

Perhaps as the industry grows and come of its own, the Chinese state will take greater cognizance of its potential uses for state aims. It is not entirely novel for PSCs or PMCs to take government provided tenders.

Afterall, the precedent for this was already set by western PMSCs who provide their own government forces, or even foreign governments, with logistical services among other facilities. Thus, it would not be wise to erase the possibility of state influence altogether either. There are few possible avenues for state influence to seep in through.

First, Private Security Companies in china often hire ex-PLA and ex-PAP (People’s Armed Police) officers into their ranks. Many higher-ranking positions within PSCs are also occupied by ex-military or former public security personnel. Second, there are reports that Chinese officials are actively pressuring Chinese enterprises abroad to hire PSCs of Chinese origin.

Conclusion

The Chinese Private Security industry is still as its initial stages. However, it is likely that it will stay given government pressure over overseas enterprises and enthusiasm by Chinese PSCs to establish operations overseas despite the dangers. Little work has been done to study the nature of Chinese PSCs in depth, but as they grow in number and prominence it will become increasingly important to understand their ins and outs and monitor their relationship with the Chinese State.

It will also be interesting to consider how, if at all, the role of the PLA might change given the emergence of these new security actors. Granted the PLA will be the most immediate and the strongest projection of Chinese national power, however this poignant power projection is not always desirable.

In such scenarios PSCs may become a viable replacement in low intensity missions. Before any of this can happen however, the Chinese government would have to loosen regulation on PSC activities and develop a framework for their operation.

For now, prospects are relatively limited and existing organizations are acting in conjunction with local authorities and companies. However, the international PMSC industry is already under heavy scrutiny for acting eerily like modern mercenaries for hire. The same could happen for Chinese companies as well.

Author: Swati Batchu
Editor’s note: The article reflects the author’s opinion only, and not necessarily the views of editorial opinion of Belt & Road News.