Muhammad Jilani, a private security adviser in Pakistan, said that the growing presence and expanding scope of the Belt and Road Initiative makes it “natural” to see a rising demand for “robust security programmes”.
“The magnitude of security deployments include AI, digital (cyber/IT), physical,” he explained, adding that private security companies will operate by referencing each country’s national policy in their overall schemes of employment.
The demand is high partly because many Chinese projects are operating in some of the world’s most dangerous regions, such as war-torn South Sudanese oilfields. Meanwhile, Beijing is encouraging more companies to go global.
In 2011, China launched its largest overseas evacuation in riot-torn Libya by rescuing 35,860 Chinese nationals via land, sea and air operations in about 10 days.
The China-Pakistan Economic Corridor, for instance, is one of the regions that Beijing invested heavily in over the past 10 years to bypass the Malacca Strait by transporting goods from the Pakistani port of Gwadar to China’s far western region of Xinjiang.
Terrorist attacks on Chinese people and projects were reported, including one occurring in August targeting a convoy carrying Chinese citizens.
The Chinese Ministry of Foreign Affairs issued a new high of 55 overseas security alerts last year, when the Ukraine war ignited more conflicts across the globe.
When the Israel-Gaza war began, the Chinese embassy warned that Chinese citizens should avoid travelling to those countries, while advising any Chinese in the region to leave.
Tom Rembielinski, manager for safety and training at Germany’s Bremen Airport Training Academy, said that the privatisation of safety work is “nothing new”, and that it is a “logical step” for the Chinese government to outsource security needs to the private sector.
He added that the US, EU and Russia “have been doing this for years”.
Relative to some international security firms with decades of experience – including G4S, Olive Group and International SOS in the United Kingdom – China’s private security operations are new to the market.
“Internationally known and well-established foreign private security companies … typically would be allowed to carry firearms/weapons, which Chinese private security companies, due to domestic regulations, are not allowed to do,” said Yuan Jingdong, an associate professor specialising in China defence and foreign policy at the University of Sydney.
“Well-established foreign private security companies would also charge much higher premiums for protection.
“Chinese private security companies … on the other hand, could only compete with lower tenders or be given contracts by Chinese companies due to the ease in communication, shared culture and other factors.”
They are also fairly small compared with their Western peers. For instance, the annual revenue of the Hong Kong-listed Frontier was HK$964 million (US$123 million) in 2022 versus G4S’ revenue of about US$20 billion.
And even though some of China’s security firms are privately owned, they often have historical ties with the army or police forces.
Take Huaxin Zhongan, for instance. It was set up by military veterans in 2004, and 70 per cent of its mid-level or top management are veterans.
To serve more than 60 overseas clients in countries such as Uganda, Malaysia and Pakistan, the company has more than 800 employees overseas, of which 660 are expatriates, according to its website.
The company specialises in escorting shipments and countering low-altitude drones, but its main business involves providing security guards for Chinese projects, along with risk assessments and consulting.
The business potential is still quite large, as the State-owned Assets Supervision and Administration Commission (SASAC), which oversees the country’s 97 large industrial giants with combined assets of 81 trillion yuan, is becoming increasingly wary of the threats facing overseas Chinese projects.
“If the security work is not properly managed, the entire project will be subject to questions (by SASAC),” said Li at Frontier Services Group, warning that the international environment is also relatively poor.
“It’s a two-pronged strategy. One is the private security power provided by our own companies. The other is seeking the governmental support of related countries.”
He warned that the development of Chinese private security companies still has a long way to go.
“It’s more appropriate to let private companies develop China’s private security sector,” Li added, noting that companies such as Frontier are struggling to secure talent and the relevant policy support in China to carry out private security across the world.
“Other than that, there’s a need to consolidate a comprehensive system by researching the work of international private security practices, so that Chinese private security companies are ready to work with their global counterparts.”
This article was first published on SCMP.
Source: CNA
