China SOEs Snap Up Overseas Chinese Media

Chinese state-owned enterprises are extending their tentacles ever deeper into the overseas Chinese media, including in Hong Kong.

In a move that should be a worry in Malaysia as well as in Hong Kong, the Malaysian timber barons who control Hong Kong-and-Malaysia listed Media Chinese International have entered into a provisional agreement to sell their 70 percent holding to a mainland company named Qingdao West Coast Holdings. The latter is a subsidiary of a so-far unnamed state-owned enterprise.

For Hong Kong, the embrace includes the Chinese-language Ming Pao. It is the second major recent move by a Chinese government-owned enterprise to take over formerly independent media.

In December, Jack Ma, who controls the China-based Internet giant Alibaba, purchased the South China Morning Post from another Malaysian tycoon, Robert Kuok, the country’s richest businessman. Fears have grown more acute since the December purchase that the paper, previously considered one of the most influential English-language dailies in the region, would cut back on critical reporting both on Hong Kong and China.

Shortly after Ma’s purchase of the newspaper, he was quoted as saying the paper would strive to ensure “objective coverage” of China in contrast to what was described as a tainted coverage by the western news media.

Media Chinese International owns key Chinese newspapers around the world. In Hong Kong, Ming Pao is a reasonably-regarded middle of the road daily paper for the middle class, and the regional weekly magazine Yazhou Zhoukan (once the stablemate of now defunct Asiaweek). Ming Pao also has editions in Canada and the US.

In Malaysia Media Chinese International operates Sin Chiew Jit Po, Nanyang Siang Pau and Guang Ming Daily, making it the leading publisher of Chinese papers in the nation. It also owns Harian in Indonesia. Sin Chew is by far the most important of the Chinese papers in Malaysia, outselling all others combined. The tabloid Guang Ming is third in circulation

Control of Media Chinese is currently held by the Tiong family of Sarawak, headed by 81-year-old Tan Sri Tiong Hiew King. They made their billions in the timber business, through years of cooperation with the former Chief Minister of Sarawak Taib Mahmud who made an uncounted fortune, mostly from timber deals, during his 33 years in office.

The Tiongs dutifully support the Barisan government in Kuala Lumpur through their newspapers and their backing for the Sarawak United Peoples Party (SUPP), a member of the UMNO- led Barisan coalition in power both in Kuala Lumpur and Sarawak. Hiew King’s younger brother Tiong Thai King was a SUPP member of the federal parliament until the last elections which he was defeated by a Democratic Action party (DAP) candidate.

It isn’t the first Chinese-language publication the Tiongs have spun off. In January, Media Chinese said it would sell an unspecified interest in One Media, which runs several Chinese-language magazines including Ming Pao Weekly and car magazine Top Gear

Media Chinese did not reveal any information about a potential buyer or say how many shares it was selling in One Media, but it owns 62.83 per cent of the company.

The company was co-founded by a lyricist with two former Commercial Radio DJs in 2009, a year before they rolled out the periodical Black Paper, which was printed on a single sheet of A5 paper and which, according to Bloomberg, “gained a reputation for its satirical, outspoken content during the national education controversy in 2012.”

Since the Tiongs took over the Hong Kong-based Ming Pao in 2008 it has become more pro-government than in the past although it maintains a degree of independence which would undoubtedly be under threat if under SOE control. The dangers of mainland ownership are escalating as President Xi Jinping revives many aspects of Maoism, not least the personality cult, and focuses on loyalty to the Communist party.

The Ming Pao case has some interesting sidelights. In 2014, the newspaper was one of several partners with the International Consortium of Investigative Journalists in a hard-hitting series of stories called the “People’s Republic of Offshore” which found that 22,000 offshore accounts were held in the British Virgin Islands by mainland and Hong Kong Chinese, including members of Chinese President Xi Jinping’s family and at least 15 members of the ruling politburo and executives from state-owned enterprises.

The story ran on Jan. 21, 2014. Just a bit more than a month later, Kevin Lau, the former editor in chief of Ming Pao, was attacked as he was alighting from his car by two individuals on a motorcycle. He was slashed on his legs three times, nearly crippling him for life and required months of rehabilitation.

For Malaysian Chinese to have their main papers owned by a Chinese SOE at a time when the Chinese state is claiming Malaysian islands and a vast area of seas which lie within its Exclusive Economic Zone (EEZ) could be deemed a threat to its national security.

At the very least it will further raise suspicions among Malays and maybe other races about whether the local Chinese community owes loyalty entirely to the country or to Big Brother in Beijing. A recent walk by the Chinese ambassador to Malaysia through a heavily Chinese section of Kuala Lumpur raised concerns about Beijing’s interference in domestic affairs. Likewise the sale of assets by scandal-ridden 1MDB to mainland SOEs led to questions about whether China was buying Malay politicians anxious to bury the 1MDB issue.

Among other things, the government is attempting to build CCTV into an English-language world service designed to compete with BBC News—but with what the US-based Columbia Journalism Review described as 19 times the annual budget of the BBC, currently the world’s largest news organization. The publication said China is allocating huge amounts of money to “external publicity work. The beneficiaries of this largesse are mostly the Big Four state-owned media corporations—CCTV, China Radio International (CRI),Xinhua news agency, and The China Daily newspaper and website in an effort to remake the negative image of Beijing that the country perceives in coverage by western broadcasters.”