U.S. Closes Chinese Consulate in Houston Amid Surge in Chinese Espionage Cases

The Trump administration ordered the closure of the Chinese consulate in Houston by Friday, a significant diplomatic escalation between the two rival powers. U.S. officials who spoke to Foreign Policy indicated that the consulate closure is a response to a surge in Chinese espionage in the United States.

Washington directed the closure of the consulate “to protect American intellectual property and Americans’ private information,” State Department spokesperson Morgan Ortagus said on Wednesday. Ortagus did not cite a specific incident that prompted the move, but she raised accusations that China violated U.S. sovereignty. The closure was announced after a sweeping indictment was unsealed in federal court in Washington state outlining years of Chinese state-directed hacking and theft of intellectual property affecting victims across the United States and in other countries.

“The United States will not tolerate the PRC’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. President Trump insists on fairness and reciprocity in U.S.-China relations,” Ortagus said, referring to the People’s Republic of China.

Chinese officials have vowed retaliation, raising the likelihood that a U.S. consulate in China will be forced closed in response. “The U.S. has far more diplomatic missions and staff working in China. So if the U.S. is bent on going down this wrong path, we will resolutely respond,” Wang Wenbin, a foreign ministry spokesman, said to reporters on Wednesday. Reuters reports suggest that the U.S. consulate in Wuhan could be closed in retaliation.

How China chooses to retaliate could determine whether the situation spirals, said Larry Pfeiffer, who served as CIA chief of staff under former CIA Director Michael Hayden. “If they want to keep it from escalating then picking a place like Wuhan wouldn’t be a bad one,” said Pfeiffer, noting that U.S. diplomats were already evacuated from the consulate earlier this year during the coronavirus outbreak. “If they closed our Hong Kong or Shanghai consulate, that would be seen as an escalation,” he said.

U.S. officials have maintained that China, like other rival powers and the United States itself, uses its embassies and consulates for spying under the guise of routine diplomatic work.

“There’s always a certain amount of spy versus spy that gets tolerated, but this would suggest to me that the Chinese have stepped outside those norms of normal espionage,” Pfeiffer said.

The United States ordering the closure of foreign diplomatic missions is a rarely used diplomatic step. The Trump administration in 2017 ordered Russia to shutter its consulate in San Francisco—also accused of being a base for espionage—as relations worsened between the two countries.

Republican Sen. Marco Rubio, acting chair of the Senate Intelligence Committee, tweeted: “#China’s Houston consulate is a massive spy center, forcing it to close is long overdue.”

“We are under siege from Chinese espionage, and they traditionally use their consulates for propaganda and espionage,” said Daniel Hoffman, a former senior executive Clandestine Services officer with the CIA who served three times as station chief overseas. “Houston is a big city, large manufacturing center, aeronautics, oil field equipment, high-tech, all things that would be of interest to China,” he added.

China also apparently used the consulate in Houston as a base to pressure and intimidate U.S. energy firms that were carrying out projects in the disputed areas of the South China Sea.

“In the bigger scheme of things, this is looking awfully like a 21st-century cold war,” Hoffman said.

FBI Director Christopher Wray warned earlier this month that Chinese espionage was the “greatest long-term threat” to the United States economic and national security during a speech at the Hudson Institute in Washington, D.C. He cautioned that China was using a multifaceted approach “to become the world’s only superpower by any means necessary,” and he said that the FBI is now opening a new China-related counterintelligence case roughly every 10 hours.

“The People’s Republic of China has engaged for years in massive illegal spying and influence operations throughout the United States against U.S. government officials and American citizens,” a State Department spokesperson told Foreign Policy. “These activities have increased markedly in scale and scope over the past few years.”

China’s top spy agency, the Ministry of State Security, maintains an intelligence unit in California, likely run out of its consulate in San Francisco, according to a 2018 investigation from Politico. Chinese hackers indicted this month in Washington worked with the Ministry of State Security.

Secretary of State Mike Pompeo, in a speech in February before the National Governors Association, accused China of meddling in U.S. state affairs. “Chinese consulates in New York, in Illinois, in Texas, and two in California, bound by the diplomatic responsibilities and rights of the Vienna Convention, are very politically active at the state level, as is the embassy right here in Washington, D.C.,” Pompeo said.

Pompeo said that in August 2019, former Mississippi Gov. Phil Bryant “received a letter from a diplomat in the consul’s office in Houston, threatening to cancel a Chinese investment if the governor chose to travel to Taiwan.”

“Phil went anyway,” Pompeo said.

As the State Department announced the closure on Wednesday, local authorities in Houston responded to reports of fires at the Chinese consulate, with witnesses reporting people in the consulate compound were burning files in trash cans, according to the Houston Chronicle. 

The United States has consulates in Chengdu, Guangzhou, Shanghai, Shenyang, and Wuhan, as well as its embassy in Beijing.