Reopening The Chinese Consulate in Houston

As China’s trade surplus with the United States continues to widen, China is confident that it is winning the race to global superiority. The country now boasts the world’s largest navy and has amassed (owns or controls) secure positions in more than one hundred ports in sixty-three countries. Moreover, recently China has flown a record number of military flights into Taiwanese airspace. With an elevated level of confidence, China seeks to reverse the restrictions imposed by the Trump administration. These restrictions include increased limits on U.S. sales to Chinese telecommunication firms like Huawei and Semiconductor Manufacturing International Corp. Further, China wants visa restrictions lifted on Communist party members, students, and journalists, along with the reopening of a Chinese Consulate in Houston. If the U.S. agrees to lifting restrictions, China will, in turn, lift some policies that target American entities, individuals, and interests. There has been some recent speculation that the Chinese Consulate General in Houston will reopen one day. The article delves into the facts and estimates the likelihood of the reopening the Chinese Consulate office in Houston during the Biden administration.

A Fiery Closure to the Chinese Consulate

“We announced the closure of the Chinese Consulate in Houston because it was a hub of spying and intellectual property theft,”

Secretary of State Mike Pompeo.

A year and a half have passed since the Trump administration’s State Department forced the closure of the People’s Republic of China Consulate in Houston, located at 3417 Montrose Blvd. The State Department’s decision to close the consulate due to theft of American intellectual property came after years of mounting frustrations over Beijing’s efforts to use the Chinese Consulate Office in Houston to steal trade secrets and expand their influence in the United States.

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Chinese Consulate General in Houston, Tx. (Closed)

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The Chinese Consulate general in Houston had a jurisdiction that included Texas, Oklahoma, Louisiana, Arkansas, Mississippi, Alabama, Georgia, Florida, and Puerto Rico. Once operations at the consulate officially ended, all work originally undertaken by the consulate general in Houston, was delegated to the Chinese Embassy in the United States, located in Washington, D.C. For people in Houston who have personal matters or business with China, the closing has created inconveniences, and delays. Given the size of the Chinese-American community in Houston and the importance of Houston to global trade, the prolonged situation has certainly created challenges.

Chinese Response to the Forced Closure

On July 21, 2020, the U.S. State Department told China to vacate its consulate in Houston. The Trump administration stated that the closure was needed to stop China from funding criminal and covert activities relating to the theft of trade secrets and malign influence operations.

The Chinese responded by ordering the closure of a U.S. diplomatic facility in the city of Chengdu. Both the U.S. and China also traded visa restrictions on students, particularly those in STEM programs and students who attended specific Chinese universities with military ties. China responded by imposing visa work restrictions on U.S. journalists, provoking the Trump administration to establish visa restrictions on Chinese journalists. Ministry spokesperson Zhao Lijian also lashed out at the United States and accused the Trump administration of egregious behavior that included violations of our sovereignty, intimidation of Chinese nationals, slandering Chinese diplomatic missions and personnel and violating international laws and basic norms governing international relations.

Passport and Visa Office of China Consulate

For businesses conducting trade in China, Americans who work in China, and Chinese expatriates, having the Passport and Visa office of China Consulate General in Houston offered convenience. The location of the Chinese consulate also benefitted local companies including nearby translation companies, visa companies and lawyers specializing in international trade. It also served the hundreds of thousands Chinese nationals and Chinese expatriates in eight states and protectorate of Puerto Rico that it served. The mission of the Chinese consulate provided important services, including authentications of Chinese documents, notarization of immigration related certificates and vital records, and issued business and tourist visas to travel and live in China. The consulate also helped build relationships between local businesses and Chinese businesses, investors and government agencies.

The Chinese consulate also permitted small businesses in the Houston area to provide faster and higher quality service at more competitive rates than could be offered by non-local businesses offering competitive services. By doing so, the Chinese consulate generated business for many local businesses, including restaurants, hotels, and catering services. For these reasons, many in Houston’s Chinese and business communities would like to see the Passport and Visa office of the Chinese Consulate General in Houston reopen.

When Should The Chinese Consulate Reopen?

Since the Chinese Consulate in Texas closed, a growing number of people in Houston are questioning whether closing was the right thing to do. But if the Chinese Consulate General in Houston is allowed to resume operations, should the United States develop new policies to protect our interests, and, if so, what should they be? Or should we simply return to business as usual and allow Chinese nationals to operate with great liberties?

Certainly, if the Chinese Consulate is allowed to resume operations, a new political policy must be developed. Over the past several decades, our country has learned difficult lessons in geopolitics that have taught us that our interests are not always the same as others. Policy developers must also evaluate the value of resuming operations, including the tangible and intangible costs incurred from the closure.

Before policy makers consider specific changes, they should review the events that led to the consulate’s closure. In July of 2020, the Trump administration gave China 72 hours to close the Houston consulate. The U.S. State Department released a harsh message indicating that closure was needed to “protect American intellectual property and Americans’ private information.” Florida Senator Marco Rubio, then chair of the Senate Intelligence Committee, described activities conducted at the Houston consulate as an integral part of China’s “network of spies and influence operations in the United States.” Further, science and technology insiders have warned for years that intellectual property theft and piracy have allowed China to make leaps in semiconductor, telecommunication, and other hi-tech fields. Indeed, the Houston consulate participated in collecting data by hosting match-making events with Chinese technology transfer centers. These events often drew hundreds of professionals from high-tech U.S. businesses each year.

But were the claims of espionage on a mass level merited or were they exaggerated and leveraged for positioning in the ongoing trade war? Some claim that credibility of specific claims of espionage, specifically originating from the Houston consulate, are difficult to substantiate. At least, specific evidence has never been made public, nor has the Department of Justice’s China Initiative ever uncovered a pattern of espionage originating from the Houston region that signaled greater risk than the risk in other regions where the Chinese have consulates. Further, if the Chinese were running a major espionage operation, it would seem more likely that their efforts would be centered near large tech centers like Silicon Valley or New York City and Boston, which feature far more businesses and universities engaged in advanced research and development projects than the region served by the Houston consulate.

While Houston is near growing tech hubs in Austin and the telecom corridor in Dallas, it is still a new entrant on the tech scene. However, Houston dwarfs both Austin and the Silicon Valley. In 2019, venture capitalists invested $2.2 billion in Austin companies, while more than $50 billion poured into Silicon Valley. Although the exact figure invested in Houston is unknown, it is significantly lower than the amount of financing received by Austin firms. Thus, it is more likely that wide-ranging industrial espionage would be centered in either New York or Silicon Valley than in Houston. However, the Trump administration maintained that China was actively involved in the theft of valuable medical research from Houston’s MD Anderson, ranked nationally as the best for producing groundbreaking research and developing new therapies for cancer prevention and innovative clinical care. The Trump administration also claimed that China was actively involved in infiltrating Houston’s oil and natural gas industries.

If the Houston Consulate was not a center of industrial espionage, why was it closed? One answer is that it was among the least important to China and could be viewed by the U.S. and China as the least likely to escalate tensions in a diplomatic war. Whether or not the closure of the Chinese Consulate was a sound choice, the closure has had an economic impact on the community. In addition to the loss of revenues the consulate pumped into Houston, the closure complicates the process of obtaining visa services, legal services, and trade advice. Further, businesses involved in international trade with China no longer have convenient access to educational seminars, trade shows and other promotional events that the consulate once sponsored. Trade with China, soon expected to surpass the United States as the world’s largest economy, has great implications for Houston’s export-heavy economy.

A Reopening Date?

When will the Chinese Consulate in Houston Reopen? At a time when U.S. and Chinese relations are struggling, people are demanding answers from the Biden administration on what they are going to do prevent a Chinese invasion into Taiwan, reduce the U.S. trade deficit with China, encourage China’s reduction of greenhouse emissions, and limit China’s global influence. The Biden administration has also been criticized as being unable to speak to China from a position of strength. At this time, China feels they have a stronger hand in negotiations, and this will fuel more debate between the U.S. and China. Therefore, serious discussions regarding the reopening of the Chinese consulate in Houston are unlikely to take place for several years.

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