CCP Plays an Important Role in Multiple Transnational Crimes: Report

Undercover footage from Masanjia Forced Labor Camp in China showing inmates making diodes during the 2008 Beijing Olympics. Courtesy of Yu Ming

China’s communist regime plays a significant role in several types of transnational crimes, according to a report from a Washington-based think tank.

The report by Global Financial Integrity highlighted the issues of forced labor and intellectual property infringement.

The regime itself engages in criminal activity, said the report (pdf) titled “China’s Role in Transnational Crime and Illicit Financial Flows,” released in October.

It also scrutinized the CCP’s role in drug trafficking, counterfeiting and IP theft, human trafficking, and wildlife trafficking.

“China serves as a major source, transit, and destination for narcotics trafficking, with the annual value of the domestic ‘drug industry’ an estimated US$82 billion,” the report said.

It cited data from the Global Slavery Index (GSI) on human trafficking. GSI estimated that, as of 2016, there were more than 3.8 million victims of modern slavery in China. Paring this data with the International Labor Organization’s average annual profit of $5,000 per victim in the Asia-Pacific region, Global Financial Integrity concluded that the value of human trafficking in China reached $19 billion.

“China has high levels of domestic human trafficking with the presence of both forced labor and forced sexual exploitation. Sexual exploitation most commonly involves forced prostitution, forced marriage, and online sex exploitation. Forced labor by state and non-state actors most frequently is used in the manufacturing, construction, fishing, and agricultural sectors,” the report said.

It also named China a “preeminent” player in counterfeit and pirated goods.

The U.S. Chamber of Commerce estimated (pdf) that 86 percent of counterfeit goods in international trade originated in mainland China and Hong Kong, worth almost $438 billion when applied to the most recent international trade estimate.

Going into wildlife trafficking, the report quoted a 2017 official document from the Chinese Academy of Engineering, which estimated the value of domestic legal wildlife trade at $74 billion. In other words, China is responsible for more than 62 percent of the global market.

“This makes China the biggest player in both the legal and illegal wildlife trades,” the report said.

Global Financial Integrity emphasized that the Chinese regime not only tolerates these crimes, but also actively engages in certain types of criminal activities.

“The People’s Republic of China (PRC or China) plays an extremely impactful role as a source, transit and/or demand country in many of the most widespread and serious transnational crimes. The country is unique in that the government itself engages in certain types of criminal activity—specifically forced labor and intellectual property (IP) rights violations. In addition, the country’s political, economic, and social policies have extensive repercussions on the presence and prevalence of these crimes, both domestically and internationally. Furthermore, the country’s willingness to cooperate and act on these crimes within the global context has been relatively limited,” it said.

Reliance on Labor Camps

Political activists as well as members of religious groups are targeted by the Chinese communist regime to perform forced labor “as part of detention,” according to the report.

Yin Liping holds up a picture of Masanjia Forced Labor Camp as she testifies before the Congressional-Executive Commission on China hearing titled "China's Pervasive Use of Torture” in Washington on April 14, 2016. Yin is a Falun Gong practitioner who survived torture, forced labor, and sexual violence in Masanjia and other forced labor camps in China. Lisa Fan/The Epoch Times

Although the CCP claimed at its 2013 national congress to have ended the reeducation-through-labor system and closed most of its sites, forced labor continues secretly with the existing facilities changing the name to drug rehabilitation facilities or administrative detention centers.

Channing Mavrellis, Illicit Trade Director at Global Financial Integrity and author of the report, told The Epoch Times that the Chinese communist regime gains two benefits from forced labor: first, it is “how they see the best way to respond to dissidents;” and second, it provides free or low-cost labor.

According to minghui.org, a U.S.-based website that documents the persecution of spiritual group Falun Gong in China, before the persecution began, prisons and forced labor camps across China were mostly short of funds. Many were on the verge of bankruptcy, with dilapidated facilities.

After former Chinese dictator Jiang Zemin launched the persecution of Falun Gong in 1999, the CCP injected huge amounts of money into prisons and so-called reeducation-through-labor camps, enabling them to imprison large numbers of Falun Gong practitioners. The regime then fully guaranteed prison funding and exempted prisons from corporate income tax and land use tax. These prison enterprises took advantage of the preferential policy and used the land, plants, facilities, and slave laborers who receive no compensation for their work, to engage in manufacturing and trade.

IP Theft

The CCP also plays a role as a state criminal when it comes to intellectual property theft. The National Bureau of Asian Research, a U.S. think tank, estimates that China is responsible for 50 to 80 percent of international intellectual property theft worldwide. The Global Financial Integrity report points out that the majority of IP theft is sanctioned by the Chinese regime.

Citing the Chicago Tribune, the Global Financial Integrity report said that the regime not only relies on spies to engage in commercial espionage, but also encourages and rewards Chinese citizens studying and working abroad to steal technology.

The Chicago Tribune report detailed the IP theft lawsuit involving two Chinese nationals working for Apple Inc. These two former Apple employees were indicted in the United States for allegedly stealing intellectual property related to the self-driving car program, including photos, schematics, and manuals. Both individuals were in the process of applying for positions at Chinese companies involved in self-driving car development.