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US orders China to close Houston consulate in 3 days

Move follows espionage indictments against two Chinese nationals

TSUKASA HADANO, Nikkei staff writer and KEN MORIYASU, Nikkei Asian Review chief desk editor

BEIJING/NEW YORK — The U.S. has ordered China to shut its consulate in Houston within three days, a move that Washington said defends America but which Beijing denounced as an “unprecedented escalation” of tensions.

U.S. State Department spokesperson Morgan Ortagus said Wednesday the closure was intended “to protect American intellectual property” and private information, without explaining why the Houston consulate was singled out.

Attention now turns to what retaliatory action Beijing may take. Reuters reported Wednesday that Beijing looks to order the closure of the American consulate in Wuhan.

The move against the consulate in the Texas city came on the same day as the U.S. Department of Justice announced a new indictment of two Chinese nationals over alleged cyberespionage against defense contractors, coronavirus researchers and other targets.

“The timing suggests that it is not a coincidence,” James Carafano, a national security and foreign policy fellow at the conservative Heritage Foundation, told the Nikkei Asian Review. “The U.S. is sending a signal that the Chinese are crossing a red line with their recent activity.”

In its indictment, the Justice Department alleged that Li Xiaoyu, 34, and Dong Jiazhi, 33, conducted a hacking campaign that began in 2009, targeting everything from COVID-19 vaccine research to email passwords of Chinese dissidents in countries including the U.S.


The two suspects worked with China’s Ministry of State Security in some cases, the indictment alleged.

On Tuesday night, hours after the Justice Department’s announcement, Houston police and the Houston fire department received a call regarding a fire at the consulate building.

“Smoke was observed in an outside courtyard area. Officers were not granted access to enter the building,” the police tweeted. Video footage showed people presumed to be consulate staffers burning what appeared to be documents there.

“Houston is home to many companies, on top of being an energy hub. It has a big university and media presence,” Carafano said. “When gathering Humint [human intelligence] they’ve got to have a place from which they can securely transmit information to China.” He suggested that the consulate may have served such a function.

The state of Texas is also home to the U.S. headquarters of Huawei Technologies. The State Department has repeatedly accused of the Chinese telecommunications giant of economic espionage and has been dissuading its allies from using the company’s equipment in their 5G infrastructure.

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Critics of President Donald Trump’s China approach have described the move as arbitrary and counterproductive.

“We need a smart, comprehensive strategy to contain, deter and engage China,” former U.S. Ambassador to Russia Michael McFaul tweeted Wednesday. “Shutting down consulates, however, helps closed autocracies more than open democracies.”

Chinese Foreign Ministry spokesman Wang Wenbin called the U.S. move “an unprecedented escalation of its recent actions against China.”   © Kyodo

Chinese Foreign Ministry spokesperson Wang Wenbin slammed the closure order as a unilateral “political provocation” and “deliberate sabotage” by the U.S.

“China strongly condemns this,” Wang said. “China urges the U.S. to immediately revoke the wrong decision. Otherwise, China will definitely make a proper and necessary response.”

Though precedents exist for ordering the closure of a foreign mission — the U.S. told Russia to shut its consulate in San Francisco three years ago — such moves are rare. The Houston consulate is one of China’s oldest in the U.S., opened in 1979 after the two countries established diplomatic relations.

“This is a crazy move,” tweeted Hu Xijin, editor-in-chief of the Communist Party-run Global Times.

But if China closed the American mission in Wuhan as retaliation, Carafano said that the blow to the U.S. would be much smaller.


“The Chinese losing access to Houston would be much bigger,” he said. “The U.S. has done its cost-benefit calculations.”

The closure order also follows reports that the Trump administration is considering a ban that would keep Chinese Communist Party members and their families from traveling to the U.S.

Ortagus struck at the Communist Party in Wednesday’s statement.

“The United States will not tolerate the [People’s Republic of China’s] violations of our sovereignty and intimidation of our people, just as we have not tolerated the PRC’s unfair trade practices, theft of American jobs, and other egregious behavior,” she said. “President Trump insists on fairness and reciprocity in U.S.-China relations.”

John Demers, the U.S. assistant attorney general for national security and the official who brought the charges against the two Chinese nationals, compared China to Russia, Iran and North Korea, accusing the country of tolerating and assisting cyber attacks.

China has taken a place “in that shameful club of nations that provide a safe haven for cybercriminals in exchange for those criminals being ‘on call’ to work for the benefit of the state, here to feed the Chinese Communist Party’s insatiable hunger for American and other non-Chinese companies’ hard-earned intellectual property, including COVID-19 research,” Demers said in a statement Tuesday.

Additional reporting by Alex Fang in New York.

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