Why China’s assault on Cathay Pacific should scare all foreign firms

AS THE TRADE war chips away at its allure, China wants to retain the affection of foreign businesses. It has promised to level the playing field between them and their domestic rivals. This pledge is meant as reassurance that Chinese firms will receive no special favours. But it has taken on a different light over the past week, in the wake of China’s assault on Cathay Pacific, Hong Kong’s flagship airline. China is taking a hard line against foreign companies that displease it, lashing out at their bosses and demanding obedience, much as it wields control over domestic enterprises. Firms in Hong Kong are in the cross-hairs, but it would be a mistake to think China will stop there.With 26,000 employees in Hong Kong, Cathay initially took a neutral stance as protests engulfed the city. The airline would not dream of telling its employees what to think, its chairman proclaimed. His defiance withered, though, as criticism from China mounted. When the Chinese aviation authority, absurdly, accused the airline of imperilling safety because its employees had joined the protests, Cathay dumped its chief executive. A climate of fear now pervades it. Chinese inspectors have started screening the phones of Cathay crew for anti-Beijing material.