Beijing's Mercenaries: China's Private Security Companies

To address the issue of Beijing's use of private militias to protect its political and economic interests, which are now widespread on a global level, it is first necessary to make a fundamental terminological and conceptual distinction between "private security companies" (hereinafter PSCs) and "private military companies" (hereinafter PMCs).

Le PMC - which Russia uses extensively in the conduct of its military policy abroad - provide armed or unarmed services in replacement of or in support of a state's regular forces and operate mainly in conflict situations.

Le PSC come into play when, for example, private entities find themselves operating in conditions of security risk and believe that their governments are not able to guarantee them a sufficient level of protection. PSCs, therefore, should protect their clients substantially from criminal or terrorist activities.

In fact, both PMCs and PSCs can find themselves involved in real war scenarios. It must be said that the international activities of Chinese private security companies represent a challenge for European interests as, often, they act in the absence of a body of legislation that binds them to rules and, furthermore, their personnel lack adequate training to deal with serious conflict and combat situations.

With the creation of the military base in Djibouti, theShanghai Cooperation Organization¹ expanding under Beijing's leadership and rapidly growing arms exports to countries around the world, China leaves no doubt (if there were any) that it intends to play a leading role in global security. The theater of operations in this complex scenario of economic warfare fought by China without holding back, is the large territorial swath known as Belt and Road Initiative (BRI), along which the Middle Kingdom has engaged in a colossal series of investment and infrastructure projects.

To get a sense of the security challenges facing Chinese companies operating abroad, consider power plant maintenance in Iraq, infrastructure development in Pakistan, or oil drilling in Sudan, all volatile regions that are part of the BRI along land or sea axes.

While domestic terrorism has long been at the top of Beijing's security priority list, especially when linked to Uyghur separatism, transnational terrorism has only become a priority for China since the BRI was unveiled in late 2013. The rapid expansion of Chinese commercial and political activities globally is exposing Chinese citizens and assets to the threats of transnational terrorism, civil unrest, and, indeed, anti-China sentiment.

Large Chinese projects can lead to significant debt burdens for host governments and can also create opportunities for corruption and rent-seeking by elite predatory, especially in countries where corruption is widespread and business management is not very transparent. If we add to these aspects a standard potentially low social and environmental levels, it is easy for social conflicts and tensions to arise that complicate the situation of a China perceived as a destabilizing element in the economy of a country.

In the past, this has happened, for example, in Sri Lanka, Pakistan and Vietnam. In 2017, terrorist groups linked to the Salafi jihadist organization Jabhat al-Nusra They carried out an attack on the Chinese embassy in Bishkek, Kyrgyzstan.² In Pakistan, attacks have claimed the lives of at least three Chinese citizens: two teachers were kidnapped and killed by ISIS in June 2017, and a shipping company employee was killed in a drive-by shooting in Karachi in February 2018.

The BRI also has a broader geopolitical impact. Relations with India, for example, are strained over ambitious BRI-related projects in Pakistan (via the China-Pakistan Economic Corridor - CPEC) and the Maldives, a long-standing Indian ally. Let us not forget, too, the long-standing dispute between the two states along the so-called Line of Actual Control (LAC) where, in 2020, regular Indian and Chinese forces came to clash with weaponry euphemistically described as “unorthodox” by the Ministry of Defence in New Delhi.³ Frankly, it was a fight worthy of the stills of 2001: A Space Odyssey, when proto-humans became aware that the bones of large animal carcasses could be used as weapons. In fact, although soldiers were allowed to carry firearms, in the name of a decades-old custom aimed at reducing the possibility of aescalation, there are agreements between the two countries that prohibit their use. However, the Chinese troops had iron bars, clubs and truncheons wrapped in barbed wire, and clubs studded with nails. The Indian side was no exception. A hand-to-hand fight began that lasted six hours and, by the end, involved up to 600 men, armed with stones, truncheons, iron bars and other improvised weapons. This was the largest operational experience involving the People's Liberation Army (hereinafter PLA) since the war with Vietnam in 1979.⁴ Basically a very violent brawl or, if you prefer, a medieval-style clash.

The Chinese government knows that it must protect its citizens and assets from risks abroad. In fact, Beijing, as well as the countries that host Chinese companies, are reluctant to deploy the PLA to protect them. There are several reasons. First, there is the respect of a centuries-old policy of non-interference, so as not to damage diplomatic relations with neighboring countries and potential allies; however, the PLA's lack of combat experience, which I mentioned earlier, does have its weight.

At present, the Chinese government relies mainly on host country security forces to provide protection for BRI projects. However, in some countries, Chinese companies feel inadequately protected by local security firms and militaries, mainly due to a lack of confidence in their capabilities and reliability, and have therefore turned to private security providers.⁵ It so happens that, while the regular forces of the PLA are engaged in flexing their muscles in front of the various archipelagos that dot the Chinese seas, the thankless task of “getting serious” is once again outsourced and, in this case, is assigned to the national PSCs.

The globalization of China's security policy presents challenges for countries around the world, but Beijing's use of private actors to defend its international interests raises a unique set of problems. In general, the presence of PSCs in foreign territory – regardless of their country of origin – is a complicated issue for host governments, due to the impact these companies can have on the interests and stability of the country in which they operate, as well as the difficulty in controlling their activities. In the Chinese case, this problem is even more pronounced due to the blurred boundary between public and private entities. Despite their status nominally private, in fact, the Chinese PSCs operate substantially with the tacit support and encouragement of their government (as do the Russian ones); moreover, their staff includes numerous former PLA officers who generally boast close ties to the Chinese authorities.

These aspects make the PSCs of the Middle Kingdom pseudo-governmental entities, whose behavior is not regulated, as existing legal regulations at both national and international levels do not clearly specify who is responsible for controlling their operations. In this context, it seems clear that Beijing runs the risk that these PSCs, not subject to defined laws and relatively inexperienced, will make mistakes on the international scene that could also have serious political consequences. China's international reputation would certainly suffer; a significant concern, considering that the leader of the party and the state Xi Jinping has pledged to transform the country into a global power by 2049.

From the point of view of European countries, but also of Russia, if we look at the Chinese presence in Africa and Latin America, the international diffusion of PSCs managed directly or indirectly by Zhongnanhai can impact their interests in regions around the world, potentially causing tension and instability in countries where they are deployed and helping Beijing increase its influence in some of these countries. When you think about it, nothing new, considering what happened with the presence of the Russian PMC Wagner in sub-Saharan Africa.

Precisely because of all the aspects listed, the Chinese government had to resort to the intervention of the Wagner Group in a delicate and dangerous situation that occurred in early July 2023 in the Central African Republic, where Russian mercenaries had to rescue a group of Chinese miners working at a Chinese-run mining site in Bambari. In March, nine Chinese citizens were killed and two injured by unidentified gunmen at a gold mine north of the same location. On July 1, the Chinese embassy received information about a planned attack by local militants and decided to ask for the help of the Wagner, already present in the area. The next day, the mercenaries spotted the miners as they sought refuge in a nearby jungle and, after two days, evacuated them to the capital Bangui. All's well that ends well and it would seem that, after having disappeared following the famous "March on Rostov" in June, the Group has opted for a grand reappearance, revealing the operation to appease Putin's wrath “demonstrating his eagerness to help Russia strengthen its relations with China.”⁶ But what is most interesting is what the newspaper reported South China Morning Post, according to which …three Chinese military sources said it is "very common for the Chinese government and state-owned enterprises to seek help from local private security forces to protect Chinese citizens and assets abroad."⁷

China does not have or allow PMCs; however, it allows PSCs to proliferate and operate, subject to a regulatory framework established by the state. Let us not forget that Beijing keeps the PLA and paramilitary groups such as the People's Armed Police (PAP) under the strict and exclusive control of the Chinese Communist Party (CCP); PSCs must also submit to this policy. Indeed, since the legalization of PSCs in September 2009, a rapidly expanding domestic private security sector has developed.

Previously, the private security industry operated in a legal limbo. There were some organizations since the mid-90s, but they were small and their operations were very limited. By 2013, there were already 4.000 registered PSCs in China, employing over 4,3 million security personnel.⁸ By 2017, that number had risen to 5.000.⁹ Like their Western counterparts, most Chinese PSCs employ predominantly ex-military or ex-police officers and, despite this, are rather poor at operating in wartime scenarios.

When operating overseas, for example, Chinese PSCs typically do not carry or use weapons. As a result, most Chinese PSCs operating overseas tend to provide services focused on security consultancy, although they occasionally carry out armed missions through local contract teams:

Chinese security company personnel are not allowed to carry weapons abroad, which is one of the disadvantages compared with Western security companies. Because they are not allowed to carry weapons, Chinese security companies are usually unable to provide services such as escorts. The very fact that Chinese security personnel must carry weapons abroad is controversial. Several industry insiders interviewed by reporters said that Chinese personnel who carry weapons can indeed incur unnecessary trouble, and if a Chinese person with a gun injures or kills people, "it is very annoying." Zhou Xiaofei said that the current approach taken by the Chinese security industry is to allow locally hired personnel to carry weapons, which does not violate the rules and can avoid the above risks.¹⁰

In an effort to create international regulation that would legitimise the activities of PMCs and PSCs outside their borders, in 2008 the Swiss government and the International Committee of the Red Cross led the drafting of the so-called “Montreaux Document”, a non-binding agreement on the matter, in which 17 countries, including China, participated. Countries such as Canada, Sweden, the United Kingdom and the United States, later joined to the International Code of Conduct for Private Security Services Providers of 2013, another document that outlines substantial measures to legally frame private security or military companies and their international operations. The United Kingdom, the United States and Sweden, for example, have national neutrality laws designed to control the involvement of mercenaries abroad, prohibiting activities that could escalate into conflicts that would otherwise be unwarranted.¹¹ In particular, in the UK there is a regulation, a little confusing in reality, which requires PMCs to register in their home country before they can engage in activities abroad.¹² Most of these laws deal mainly with PMCs and only marginally with PSCs; for this reason, since in the Middle Kingdom the private security market is almost entirely made up of the latter and they are not subject to defined rules regarding their activities outside national borders, the presence of Chinese PSCs spread throughout the globe cannot fail to cause concern.

China's security sector laws, therefore, only address domestic activities, and international law is vague about PSCs, although, as we have seen, it does cover their activities in conflict situations. Some of the existing laws have had the effect (perhaps unintentionally) of encouraging the rapid international expansion of Chinese PSCs. The most important of these laws regulating domestic PSCs is the "Regulation on the administration of security and surveillance services" (保安服务管理条例) in September 2009, which legalized the companies and was Beijing's first attempt to establish a regulatory framework for the industry. This regulation makes it clear that Chinese PSCs are entirely under the control of the state, through the Ministry of Public Security (MPS), the Gongganbu. This shows that the boundary between public and private in this sector is blurred. PSCs wishing to provide armed security services inside China are effectively required to give up their status private, as they must be entirely state-owned or have a state participation of at least 51% of their entire share capital.¹³

In 2010, the Chinese Ministry of Commerce issued a series of rules and regulations for companies operating overseas, creating very stringent safety requirements for them and thus indirectly encouraging Chinese PSCs to become international companies, even though they are not explicitly mentioned. “Regulation on the Safety Management of Overseas Enterprises, Institutions and Personnel Funded by China” (境外 中资企业机构和人员安全管理规定) under the principle of “sending is responsible” (谁派出，谁负责), Chinese enterprises must provide adequate safety training to their employees before sending them abroad. Companies operating in high-risk areas must also establish overseas safety management systems and emergency response mechanisms related to safety.¹⁴ By offering such training programs and security management systems to Chinese companies abroad, especially along the BRI, a niche market has been created for Chinese PSCs, potentially encouraging their massive entry into the international private security market. There are also serious gaps in the legislation regarding the use of weapons abroad. The use of weapons by PSCs on Chinese soil is strictly regulated by several laws, including the 1996 “Arms Control Law of the PRC” (中华人民共和国枪支管理法) and the 2002 “Regulations on the Use of Firearms by Full-time Escort Personnel” (专职守护押运人员枪支使用管理条例), but there are no provisions regarding the use of weapons on foreign soil.

As mentioned above, Chinese PSCs often distinguish themselves from their international counterparts by choosing to have their employees operate unarmed. The reasons for this have already been outlined, and they are mostly related to avoiding embarrassing situations for the government. The use of weapons by PSCs, however, is not explicitly prohibited by Chinese law or even international law. Therefore, in theory, Chinese PSCs could at any time start using firearms in countries where local laws allow it, if they were willing to ignore political pressure from Beijing.

Bound, therefore, only by the laws of the country in which they operate, Chinese PSCs operating outside their own borders have a wide margin to act with little or no legal consequences at home. vacuum regulatory framework, for example, may mean that Chinese PSCs are not required to obtain domestic authorization for their operations abroad, although they may need one from the host country. This sort of deregulation carries the risk that small, unqualified companies will exaggerate their expertise and create units that cannot provide the services advertised. Moreover, in countries with lax regulations on gun ownership, Chinese PSCs may be able to easily dispose of them. In countries with stricter regulations on arms control and the activities of foreign PSCs, however, Chinese PSCs still limit their services to consultancy. In such cases, PSCs that want to offer broader security services must form partnerships with local security companies, as they have done in Pakistan.

As China's business and political activities spread around the world, some of the largest and most successful domestic PSCs have begun to follow the international expansion of Chinese companies and now also provide security services overseas. However, the vast majority of these companies still operate exclusively in China, providing security services for public or private facilities or offering bodyguard services to wealthy and powerful Chinese personalities who request their services. According to state media, 2016 Chinese PSCs entered the international market in 20,¹⁵ which employed approximately 3.200 workers.¹⁶ Compared to the presence of Western PSCs abroad, the market share of Chinese PSCs is still small: in 2008, there were approximately 50 foreign PSCs operating in Iraq alone,¹⁷ with a clear prevalence of those from the United States and the United Kingdom.

The situation, however, is changing rapidly, as Chinese state-owned enterprises and other domestic companies operating overseas tend to shift their preferences towards employing Chinese PSCs. There are various reasons for this shift, including the language and cultural barriers encountered when working with non-Chinese personnel, as well as economics, as international PSCs tend to be more expensive.¹⁸ It is estimated that a team of 12 Chinese operators could cost as much as a single British or US guard.¹⁹ Added to these aspects is the fact that the Beijing government has begun to exert pressure for Chinese companies to hire only national PSCs.

There is currently no comprehensive and publicly available list of all Chinese PSCs operating overseas, but some of the most active companies are easily identifiable. In 2016, the Phoenix International Think Tank – part of the Phoenix Media Group Chinese – has identified important PSCs active abroad, indicating them in a ranking.²⁰ The top two companies in this ranking are the Chinese subsidiaries of British PSCs. G4S e Control Risks, followed by eight wholly Chinese-owned PSCs: Beijing Dewei Security Service Co. Ltd. (北京德威保安服务有限公司); China Industrial Security Group (中安保实业有限公司); Huaxin Zhongan (Beijing) Security Services Co. Ltd. (华信中安（北京）保安服务有限公司); Shanghai's China Cityguard Security Group (上海中城卫保安服务集团有限公司); Beijing Ding Tai An Yuan Security Technology Institute (北京鼎泰安元安全防范技术研究院); Shenzhen Zhongzhou Special Security Consulting Company (深圳中州特卫安全顾问有限公司); Beijing Guanan Security & Technology Company (北京冠安安防技术有限公司) and Shandong Huawei Security Group (山东华威保安集团股份有限公司). It doesn't appear in the list, but is equally relevant, the China Overseas Security Group (中国海外保安集团). It must be said that G4S e Control Risks are just two examples of international PSCs that have set up Chinese subsidiaries. The former head of the American private military company Blackwater, Erik Prince, also created a PSC in Hong Kong called Frontier Services Group (先丰服务集团).

It seems that the very Gongganbu, which has the authority to supervise the private security sector within the country, is oriented to regulate the operations of PSCs also outside the national territory. In this regard, the magazine Caijing reported that the “China Security Association” (中国保安协会), an organization under the jurisdiction of the Gongganbu, would have drawn up a “white list” of Chinese PSCs deemed suitable to work abroad.²¹

I have mentioned the lack of international or domestic regulatory framework for regulating Chinese PSCs’ activities abroad, which are therefore mainly determined by the host country’s regulations and the contracts signed with the companies that employ them. Countries like Pakistan, Sudan and South Sudan are two paradigmatic examples of the two ends of the spectrum: Pakistan has strict regulations on foreign PSCs on its territory, while Sudan and South Sudan have no significant regulation of this kind.

The China-Pakistan Economic Corridor (CPEC) is the flagship project of the Belt and Road Initiative and aims to connect the BRI Maritime Silk Road with the Land Silk Road, through a 3.000 km network of roads, railways and pipelines to transport oil and gas from Gwadar, a Pakistani port on the Arabian Sea, to the Chinese city of Kashgar in northwestern Xinjiang. Over 30.000 Chinese nationals are said to be employed in various CPEC projects in Pakistan.²² We are interested to know that the CPEC passes through notoriously unstable and unsafe parts of Pakistan. Beijing’s concerns for the safety of its citizens are therefore significant, particularly in parts of the country where Chinese citizens have been targeted by extremists, such as Quetta and Karachi.

It is difficult to obtain reliable information on the true extent of Chinese PSC activities in Pakistan. Some, such as Frontier Services Group (FSG) and China Overseas Security Group (COSG), claim to operate in Pakistan and it is likely that these companies work with Partner local in the country. FSG, for example, said its Northwest Regional Division serves Pakistan, Afghanistan, Kazakhstan and Uzbekistan. COSG on its website website claims to have a branch in Pakistan and in one article stated that it collaborates with a local security firm.²³ The company said its Pakistani subsidiary, called Pan Asia Group, attended a training course on the use of firearms for personnel involved in protecting Chinese overseas, in light of the deteriorating security environment. PSC Huaxin Zhongan, then, claims to have operated in Pakistan at least once, employing local personnel recruited from retired military personnel from the special forces, as armed guards for the security of the troupe Chinese TV channels called to cover the 2017 Quetta kidnappings. While foreign PSCs are banned from working in Pakistan, companies like COSG, FSG and Huaxin Zhongan have apparently found a way around the ban. The continued instability and volume of Chinese investment in Pakistan will likely lead to an increase in the presence of Chinese PSCs in the country, taking advantage of the Middle Kingdom's preference for domestic security companies.

The case of Sudan and South Sudan provides another example of the achievements and limitations of Chinese PSC work abroad. We consider the two countries together because Chinese involvement in the region, which focuses primarily on the oil sector, dates back to the late 90s, when oil-rich South Sudan was not yet independent. Although neither Sudan nor South Sudan are officially part of the BRI, both governments are trying to use their strategic location near the Maritime Silk Road to attract Chinese investment. The Sudanese government in Khartoum, for example, has announced that it aims to turn Port Sudan into a free trade zone to support the BRI.²⁴ Security in the region has long been a problem. In October 2008, nine Chinese workers from China National Petroleum Corporation (CNPC) were kidnapped in Sudan's oil-producing state of South Kordofan; four of them were killed. And in late January 2012, rebels from the “Northern Group of the Sudan People's Liberation Movement (SPLM)” kidnapped 29 Chinese workers from China Power Construction Corporation, state-owned, in the same region.²⁵ For some years, the security of oil facilities has been largely in the hands of the South Sudanese military, but Chinese companies operating in the region have long begun to use the services of PSCs for their own security.

Neither Sudan nor South Sudan have clear laws or regulations restricting the operations of foreign PSCs in their territories and arms control legislation in the case of Sudan²⁶ does not mention PSCs, while in the case of South Sudan it allows private security contractors to carry and use firearms, provided they have a license.²⁷

In July 2016, the involvement of the Beijing Dewei Security Service (DeWe) in a skirmish in the South Sudanese capital of Juba. The PSC was called in to protect workers at CNPC (its largest customer in the country) and help evacuate 330 civilians in Nairobi, Kenya, after a shootout between warring local factions. Reports of the incident said that DeWe workers at the time were unarmed and largely unprepared for such a scenario. Ultimately, the evacuation of the workers, who were all found to be safe, had to wait until government forces had expelled the rebels from the city.²⁸ Other Chinese PSCs, such as the Weizhijie Security Group (The Great Wall of China)²⁹ - whose main customer abroad is PetroChina - or the China Security and Protection Group,³⁰ they claimed to provide services in the African region under consideration. Examples of PSC activity in Sudan and South Sudan show that Chinese PSCs are very active in the region and occasionally get involved in combat scenarios.

Chinese PSCs, however, are not the only private security contractors operating in the region. International competitors, such as G4S e Control Risks, as well as PMC as Dyncorp o Academi (Eg Blackwater), conduct missions in the region, primarily in South Sudan. The outcome of this competition, however, will most likely not depend on which security providers are more effective or better prepared. Instead, it will depend on which international firms are willing to continue investing in the region, despite the risk. As Beijing encourages Chinese state-owned firms to hire Chinese PSCs, we can expect Chinese PSCs to use the momentum of China’s growing involvement in the region to gradually increase their market share.

In conclusion, we can say that PSCs have become a good alternative to protect Chinese investments abroad. Beijing must ensure the safety of Chinese citizens, as well as the success of BRI-related projects, especially when the initiative expands to unstable and insecure countries. However, sending PLA troops is not a realistic option at the moment, as it would go against China's self-proclaimed principle of non-interference, as well as the benevolent image that China wants to project through the BRI. The relative “private” nature of PSCs would be useful to Beijing, allowing for plausible deniability in worst-case scenarios while reaping the public relations benefits of mission successes in best-case scenarios. China is not the first country to come to this conclusion, as other international examples of the use of PMCs and PSCs in armed conflicts or post-conflict reconstruction have shown. The difference, however, is that Chinese PSCs are (indirectly) linked to the CCP, through the almost exclusive recruitment of PLA veterans..

Any incident where Chinese PSCs are found to be unprofessional in handling a military conflict could turn into a political disaster for Beijing. Furthermore, under international law, it is the state’s responsibility to supervise and monitor PMCs and PSCs based in its own country. In the event of a dispute when engaging in overseas activities, the state with which the companies have contracted is responsible. This also applies to China, of course. It is therefore clear that regulating Chinese PSCs’ overseas activities has benefits for both Beijing and the international community.

So far, China has not taken any measures to improve the existing international legal framework or create new norms to control the behavior of PSCs. To ensure better quality control of its PSCs' presence abroad and build a good relationship with host countries, Beijing should become a member of the "International Code of Conduct" and require all Chinese PSCs intending to operate internationally to do the same. At the domestic level, Beijing should push the Gongganbu to issue a new regulation specifically aimed at the overseas operations of Chinese PSCs. Models for such regulation abound on the international scene, including in several European countries. Countries such as the United Kingdom, Belgium or Sweden, with more strictly regulated domestic private security sectors and which have agreed to sign up to international regulations, could play a key role in encouraging Beijing to take these steps.

To ensure the safety of BRI-related projects, Beijing currently negotiates the terms of Chinese PSC operations on a bilateral basis with host governments in the countries where they operate. In this way, Beijing could tailor these agreements to each country's national PSC regulatory system to achieve greater clarity on liability in the event of an accident. From Beijing's perspective, this would be a practical solution, as it would allow China to use its political and economic influence over host governments to create favorable conditions for Chinese PSCs. The systematic deployment of PSCs can also help Beijing maintain the image of a China not oriented towards global military expansion.

Hard data on the scope and scale of China’s private security sector remains elusive. What is clear, however, is that demand for services from Chinese PSCs, as well as their potential supply, is set to expand especially along the BRI, especially in the maritime sector and in the training of police and security forces in developing countries.

There are several key areas for studying the development of Chinese PSC employment in the future.. The first is to have a comprehensive database of all PSCs active in China and abroad. The second is to conduct a comprehensive analysis of where PSCs are deployed abroad, with a particular focus on what is happening in BRI countries. The third would be to monitor PSCs abroad, through an analysis of satellite imagery of the training areas they use, to identify the types of forces they train, their capabilities, and the types of operations they train for.

Until the above measures are adopted and progress is made in regulating China's PSCs, China's use of PSCs to protect its interests abroad It can seriously undermine China's credibility and does nothing to allay concerns about Beijing's international investments and its real intentions to be a responsible global security actor..