Is China’s Tibet Policy Bad for Business?

When a Chinese government security official recently accused followers of the Dalai Lama of organizing suicide attacks – merely the most extreme of a barrage of allegations against the “Dalai clique” – it was as though the Cultural Revolution were still raging. Indeed, particularly where Tibet is concerned, the increasingly sophisticated and pragmatic Chinese leadership seems more like a throwback to the Mao era, with its haranguing propaganda and coercive policies. Do foreign investors have reason to be worried by all this?

While there is arguably a genuine possibility that the recent protests in Tibet will prompt the authorities to change course, early signs are not promising. So far, the regime has merely applied the same blunt measures that fueled Tibetans’ grievances in the first place. International pressure alone will not change this. Domestic pressure could, but any such opportunity has perished on the battlefield of a public-relations war.

On one hand, some international media painted a black-and-white (and not always entirely objective) portrait of the March violence as a brutal Chinese crackdown on peaceful Tibetan monks. On the other hand, official Chinese media have stoked domestic anger at perceived Western anti-Chinese bias. With nationalist sentiment aroused, few Chinese are asking why the violence occurred.

Of course, the Tibet issue has been around for decades, generally without posing serious problems for foreign investors. But the combination of the first serious unrest in Tibet in almost 20 years and the wider groundswell of criticism being directed at China ahead of the Beijing Olympics has sent businesses and investors scrambling to assess what it means for them, particularly in terms of reputational and ethical concerns.