The Trump administration has decided to restrict or even ban the sale of technologies to several Chinese tech giants. What are the short-term effects and potential long-run impact on China’s tech industry?
The impact differs depending on the case. The most extreme case is probably Huawei. The Commerce Entity List cuts Huawei off from its main supplier of semiconductors or at least the companies that fabricate the semiconductors that are essential for Huawei’s smartphone and 5G business. Here, the future looks pretty bleak for Huawei because it is struggling to find suppliers. Chinese producers can’t produce at the same level of technology, so Huawei has been stockpiling and trying to find other sources. On the other hand, for something like TikTok, which has about 100 million users in the US and many outside, the question is really about access to the US market. That deal is still being worked out and the long-term impact seems to be the bifurcation of the technology markets in terms of US supply and Chinese supply.
If the US or other countries choose to ban TikTok, WeChat, and/or other social media platforms, how much does that affect China’s ability to capture the technology market outside China?
It has a big effect. We should remember that China blocked foreign social media first—the Great Firewall is blocking Facebook, Twitter, and other US social media platforms. Chinese companies were looking to expand abroad. It will be important if we see a cascading effect. China’s access to the US market depends on what happens with the TikTok deal; but India has already blocked over 220 Chinese applications. There is not a lot of evidence that other countries are thinking about doing that right now. However, they may certainly decide to follow India’s lead.
The Trump administration claims that they want to ban the social media platforms TikTok and WeChat because they worry that the apps are a threat to national security. Both of these apps collect extensive information about its users that could lead to the violation of privacy. Additionally, US officials are concerned that the apps censor political speech and could be used to spread misinformation. On the other hand, China and the US are clearly engaged in a technology cold war. How much of the US’ reasoning to ban these social media platforms is justifiable because of national security concerns and how much is due to the escalating tensions and mutual hostility?
It is both, and it is difficult to pull out how much of this is in response to national security concerns and how much is in response to the escalating tensions. However, the difficulty with the national security arguments, in particular with TikTok, is that the administration has never made it clear what the threat is. Certainly, there are data and privacy risks from using TikTok. The app itself was doing some very intrusive things to people’s phones. Some of those have been addressed by TikTok, but some have not. That said, the level of intrusion is about as high as most other social media apps. For example, Facebook and Twitter also give companies access to your data. The concern with any Chinese technology company is whether it will be required to turn that data over to the Chinese government per the 2017 National Intelligence Law. The Trump administration has implied that there is a long-term risk of intelligence and counterintelligence from Chinese tech. For example, twenty years from now the Chinese government will be able to take the data from TikTok—like the funny dances you did when you were 15 or 18—and put it together with other data that they have captured from the Anthem Equifax, or from other hacks, and approach you to blackmail you. From a national security perspective, I don’t think that risk is particularly high. I agree, however, that the app should be kept off the phone for US government officials.
The other risk that you mentioned is influence operations or propaganda. The risk here is slightly higher. There is some reporting about how TikTok dealt with the Hong Kong protests or concerns about Uyghurs, and things like that. There is some concern there, but again, it is not that much different from other social media because the algorithm is not transparent and we still don’t know how some content is played up and some is played down. Those should be addressed, but I don’t think the sale of TikTok to a US company necessarily addresses that concern.
What are the substantial differences between the social media platforms that are already used, like Instagram, Facebook, and Twitter, where people are also posting, dancing etc. for intelligence-gathering purposes?
The big difference is just where the owners of the company are. If it is a Chinese company, then they might have to turn over this data because of the National Intelligence Law. However, there is so much data out there anyway that it is unclear whether TikTok adds a particularly unique or special type of data. For example, about two weeks ago it was revealed that a company called Zhenhua in Shenzhen was scraping all of the open-source data available from Facebook and Twitter on prominent US, Australian, and Canadian citizens. All of that information is available for intelligence purposes as well.
With more advancing technology in social media, search engines, and artificial intelligence, there becomes a greater chance for the invasion of privacy and national security. How should countries who have diametrically opposing values or are competing hegemons—like China and the US—work together to bring about the benefits of technology while still keeping national security in mind?
It is very hard right now to imagine how we are going to cooperate, just based on the differences in views of privacy and state access to data. China announced a global initiative in early September in an attempt to cooperate. However, the important thing to do right now in the US is to try to bridge the gap with Europe on some of these concerns—instead of focusing on China. For example, the European Court of Justice recently ruled that US companies could not transport data from Europe back to the US.
It is really important to figure out a framework for privacy. Then, try to get other countries like India, South Africa, Indonesia, Brazil, and other multi-ethnic democracies on a common set of norms. At that point, the US could start discussing with China about how to regulate firms.
Some people have argued that China created the Great Firewall, making the first move in the technology cold war. However, is retaliating with the same methods as China is using the best approach? And will a fragmented tech sector serve US interests and make it more secure?
It is difficult for the US to balance its goals in the technology cold war and the broader strategic objective the US is trying to achieve. For example, the bifurcation and split of the technology market serves some US objectives. Clearly, there were some security vulnerabilities for both China and the US that are addressed by moving some supply chains back to the US and by insisting some suppliers operate under US regulations. That does address some of those concerns. However, the US has other objectives as well. One of them has always been to promote a free, global, open Internet. That objective is not served by a bifurcated, split technology market. Even though the US has not been doing this so far, the country needs to identify which technologies must be split and must have only trusted partners, which ones don’t have high security threats, and which ones are important for cooperation. For this last category, we should talk about climate change, energy capture, and similar technologies. However, right now, the US has only been focused on competing and has thought little about the gradation of those technologies strategically.
I’m interested in the role that immigration plays in the so-called technology cold war. In an article titled “The Coming Tech Cold War With China: Beijing Is Already Countering Washington’s Policy,” you write that “smarter immigration policies could prevent many of the best and the brightest from seeking opportunities…” elsewhere. How do you think the Trump administration has grappled with this suggestion? Do you think that rising nativism plays a role in hindering the US’ advancement in technology?
I don’t know if the Trump administration has grappled with that yet. There are a number of criticisms from people who look at innovation policy and technology policy, especially around artificial technology, that have warned that the US benefits immensely from Chinese students coming to the US to study artificial intelligence (AI). There are some threats of espionage, and we want to address those. But we want to make sure that the US doesn’t shoot itself in the foot when addressing the spying issues. What we have seen from the Trump administration so far is focusing on blocking Chinese students with connections to military universities or civil-military fusion programs inside of China. The Trump administration has argued that they have tried to be more surgical about it. Given the rise of nativism and the use of the term “the China-virus” by the president and others, however, Chinese students are probably feeling that the environment is not all that welcoming for them right now.
Solen Feyissa from USA / CC BY-SA (https://creativecommons.org/licenses/by-sa/2.0)