Over the last few months, there is a growing perception that foreign companies have done too well from their investments. The Party leadership has publicly accused a few of capturing "excessive" market shares, acquiring too many stakes in China's strategic industries, and buying state assets at bargain prices. Above all, there seems to be a concern that overseas investors own too much of the technology crucial to China's economic development.

These sentiments aren't only murmured in private. Li Deshui, a former economic official, was quoted in March as criticizing "malicious acquisitions aimed at establishing monopolies." He cited beer, soft drinks and skin-care products as areas where foreign companies had done too well at the expense of their local counterparts...

In September, six ministries enacted regulations that give the Ministry of Commerce expanded power to block foreign purchases of local companies. The law's language is vague; a purchase that disturbs "the social or economic order or harm the public interest," for instance, could be reviewed...

The problem for foreign companies is that Beijing is willing to use tactics which give their Chinese counterparts an unfair advantage. These measures include state subsidies through politically motivated bank lending at below-market rates. For instance, Cnooc Ltd.'s abortive bid for Unocal Corp. last year was backed by several billion dollars in cheap loans from its government-owned parent company. It's also possible in future that Beijing will challenge patents and cap domestic retail prices to reduce the royalties paid to foreign patent and copyright holders.

China's economic nationalism is a marginal adjustment to, rather than a fundamental repudiation of, Beijing's broader embrace of globalization. ...Other "China risk" factors may receive far more publicity -- from the threat of a financial crisis to a political collapse, or even a conflict with the U.S. over Taiwan. But for companies doing business with China, it is the new surge in economic nationalism that poses, by far, the biggest threat for the foreseeable future.