The Confucius Institute (CI) programme began in 2004 and is financed by the quasi-governmental Office of Chinese Language Council International (colloquially, Hanban). Consequently, this programme excludes issues the Chinese Communist Party’s (CCP) considers to be "politically sensitive", such as political freedoms in Tibet and Xinjiang or the 1989 crackdown on protesters in Tiananmen Square. The CCP is highly concerned about its international image and is thus increasingly active in promoting itself globally through such programmes. 

China has very cleverly crafted the CI programme to avoid any scrutiny from the government agencies of the host countries. The initial complacency toward these institutes had allowed Beijing to set the pro-CCP narrative in the Western countries although, some Western academics had understood the real motive behind the programme. For instance, the American Association of University Professors had issued a warning that "Confucius Institutes function as an arm of the Chinese state and are allowed to ignore academic freedom". The association had even urged colleges across the United States and Canada to "reconsider their partnerships with Chinese language and culture centers, or CIs, financed by the People’s Republic of China".

Interestingly, in a 2019 report the US Senate Permanent Subcommittee on Investigations had found that Beijing was using these institutes to play down "any economic and security threats to the US from China". The investigation had made a critical observation about the institutes:

"Confucius Institutes’ soft power encourages complacency towards China’s pervasive, long-term initiatives against both government critics at home and businesses and academic institutions abroad."

The statement makes it clear that Beijing takes advantage of "open academic environments" in democratic countries through such educational programs to push the CCP’s ideology, curtail free speech and steal sensitive academic research. Chinese cultural ingress through Confucius Institutes, or even China Towns’, are part of a well-crafted strategy to infiltrate the western culture through so called soft power tools. Therefore, it is not surprising that some observers in the US have characterised the CI programme a "threat to our nation’s security by serving as a platform for China’s intelligence collection and political agenda". As Beijing’s economic and military belligerence is becoming more apparent, several non-Communist regimes are openly exposing Chinese propaganda in their countries. This has made the CCP nervous since it fears open criticism and media scrutiny of its ideological marketing machinery. 

China has defended Confucius Institutes, comparing them with other organisations such as Alliance française and Goethe-Institut. However, unlike the two European cultural promotion institutes, many CIs operate directly in university campuses, thus giving rise to unique concerns related to academic freedom and political influence. According to the US-based National Association of Scholar’s 2017 report, "Outsourced to China: Confucius Institutes and Soft Power in American Higher Education", Confucius Institutes undermine academic integrity and import censorship. In the US, CIs have been blamed for threatening "the ability of the next generation of American leaders to learn, think and speak about realities in China and the true nature of the Communist Party regime". Several US lawmakers have raised alarms over the presence of these institutes on the American soil.

Spearheading the movement against the presence of Chinese-funding academic institutions in the US, Senator Marco Rubio (R-Florida) had warned in 2018 that the goal of these institutes was to "instil in the minds of future leaders a pro-China viewpoint". US officials have been pushing to close Confucius Institutes for some time now. William Burns, the current director of the Central Intelligence Agency (CIA) said last year that if he were a US college or university president, he would recommend shutting down Confucius Institutes. In addition, the former director of the Federal Bureau of Investigation (FBI), Christopher Wray, told a Senate panel in February 2018 that the FBI was "concerned about the institutes". All these statements suggest that the CI programme has become a major security threat in the US. 

Besides US, Sweden, France, and Australia have also taken actions against Confucius Institutes. As the first European country, Sweden had closed all CIs in the country in 2020. Whereas the Australian government has directed all local universities that host Confucius Institutes to publicly disclose how they are funded and retain control over what students are taught. Despite all these efforts, Confucius Institutes are rebranding and reopening in the wake of widespread backlash. According to a National Association of Scholars report (June 2022), Hanban has renamed itself the Ministry of Education Center for Language Exchange and Cooperation and spun off a separate organisation, the Chinese International Education Foundation, that now funds and oversees Confucius Institutes and many of their replacements. This rebranding may not work considering more countries are now aware of China’s overseas propaganda activities.