By Geoffrey Smith
August 11, 2016

Good morning.

 

Snapchat succumbed yesterday to a wave of online outrage about a filter that smacked of anti-Asian racism (a yellow face with closed, slanted eyes). It seems a good moment to wonder if the same outrage will ever be directed at those who are blocking Chinese investment overseas.

 

It may be easier to illustrate the problem in three cases where U.S. interests aren’t directly affected. Today, Australia moved to block a Chinese consortium of state and private interests taking a controlling stake in the country’s largest electricity network over national security concerns.

 

Last week, the U.K.’s new Prime Minister slammed the brakes on a project to build the country’s first new nuclear power station in 40 years due to China having a minority stake in it (although one suspects that London is more concerned about wriggling out of a ludicrously high power-purchase contract it has already signed with the lead partner, France’s EDF).

 

The national security risk may be clear, given widespread evidence of Beijing’s formidable and growing cyberwarfare capabilities. But one reflects a legitimate desire for a reliable yield in a world of low returns, and the other an important (if arguably misguided) learning experience in the country’s search for a long-term low-carbon energy future.

 

But, either way, how credible is the threat of China abusing the leverage it gets through such investments? It is a country that guarantees its internal stability by exporting to the rest of the world. Breaching the trust of its trading partners would quickly prove counterproductive. The example of Vladimir Putin (of whom, more below) and his use of the gas weapon in Europe makes this only too clear.

 

Even where there is no national security interest and no direct line back to politicians back in Beijing, as in the acquisition of German robot maker Kuka by China’s Midea Group, western politicians continue to resist Chinese investment much more stiffly than that of other countries. Security concerns matter, obviously. But when domestic business isn’t investing despite five years of pleading from governments and central banks, you’re allowed to wonder whether it makes sense to be so sniffy about foreigners who are.

(Alan Murray is away today.)

Geoffrey Smith
@geoffreytsmith
geoffrey.smith@fortune.com

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