On China's New Silk Road

ep07China’s Digital Silk Road

China’s Digital Silk Road

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China is fast becoming a global leader in cutting edge technologies—such as AI, facial recognition, surveillance, and 5G—and is exporting them worldwide. Fans like the high quality and low cost. Critics say China’s technology enables authoritarian control and dependence. They call for democracies, including the U.S., to work together to create a tech ecosystem that protects privacy and freedom of speech. Produced by the Global Reporting Centre.

Episode Transcript

When I lived in China, from 2003 to 2013, a big part of my job as a correspondent for PRX’s The World was to explain the seismic transformation happening then in China, and what it might mean for the world. 

(Sound of construction)

It was a time when China’s city skylines were filled with construction cranes, when villages became towns, and towns became cities, when per capita GDP grew six-fold in a decade, when economic growth was blazing, and ambitions were big. 

And then, from the top levels of government came a new focus, a new goal – that China would move from being the factory of the world, making socks and toys and pet food – to being a world-class innovator, a leader in cutting edge technologies.

All this came together in one Chinese city I visited often, right on the border with Hong Kong. 

(Sound of kids playing, bicycle going by)

Shenzhen started out as a cluster of fishing villages. Then, 40 years ago, China’s Communist leaders made it a special economic zone – a place where free trade and capitalism had more room to run. In the early ‘90s, then-leader Deng Xiaoping kicked it into high gear with a visit here, encouraging Chinese to come here, work hard, and get rich. 

Eric Pan: So in a very, very short time, the whole city’s built from scratch. 

This is Eric Pan. He moved to Shenzhen from Beijing, and started Shenzhen’s first Maker Space – a place where people could come for fun to make tech components – or anything – with their hands.

Beijing, China, with a Statue of Liberty poster in the foreground. (Mary Kay Magistad)

Eric Pan: And a lot of people come from all over the country to Shenzhen to chase for a new opportunity, and to challenge the uncharted.

(Sound of crowd at tech fair) 

And along the way, Shenzhen became a hip, tech city, a darling of Silicon Valley, a host of tech fairs like this one, where the Chinese drone maker DJI, which is based here, is putting one of its drones through the paces: 

(Sound of drone in the air) 

The crowd ‘oohs’ and ‘aahs’ and people get out their phones to snap photos and record videos. 

(Sound of crowd as drone flies overhead)

Many of those phones may have been made by China’s telecommunications giant Huawei – based here in Shenzhen. And there’s a good chance the people in this crowd were sending their photos and videos via WeChat – the chat app that’s actually more like an all-in-one app, and that most Chinese have on their phones. WeChat’s parent company, Tencent, is based here in Shenzhen too. And if anyone wants to buy a drone –perhaps to take aerial videos next time they go on a hike – they could use digital payment through WeChat, or through another tech giant not based in Shenzhen – Alibaba, and its Alipay. 

Many of the top tech and biotech companies in Shenzhen are ostensibly private sector. But they’re also national champions. So when President Xi Jinping made his own Southern Tour to Shenzhen in October 2020: 

Xi Jinping: (Speaks in Chinese) 

He pledged to make Shenzhen even more of a tech leader, and to make China more beautiful and more powerful by the time the Communist Party celebrates 100 years in power – in 2049. President Xi has called on China’s top companies to work more closely with China’s military and with state-owned companies, to get behind his China Dream – to make China a world leader in all ways, including in the technologies that will shape our lives. 

What that means for the rest of the world, especially democracies, is now very much a live question. 

(Music)

You’re on China’s New Silk Road. I’m Mary Kay Magistad, a former Beijing-based China correspondent for NPR and for PRX’s The World, looking here, with the Global Reporting Centre, at how China’s global ambition is seen around the world, and at the impact China’s New Silk Road investments are having on the ground.

(Music) 

China’s New Silk Road is officially called the Belt and Road Initiative. It’s about building a belt of land routes, and what China’s leaders call a Maritime Silk Road of sea routes – a new network of global trade and global power, that puts China at the center. Most of the world’s countries have signed on in some way, and China has already laid out – in loans and investments – more than half a trillion dollars toward these projects. All told, this may be one of the most ambitious global infrastructure initiatives ever – pitched to the world through folksy promos like this one, as being: 

Male voice, rapping: “Wheels, wings, highways and railroads. 

Female: Don’t forget the Internet! 

Male: To do business, you need them all.” 

This includes a Digital Silk Road – which is many things, including plans to use a Chinese digital currency, globally – that could challenge the dollar as a dominant global currency, and put a huge amount of user data and leverage in the Chinese government’s hands. The overall goal of the Digital Silk Road is for China to become the global leader in important new technologies – to make profits, set standards and norms, and bind the world closer to China, and to its vision of how the world should be. 

(Huawei commercial) 

One of the big winners in that effort has been China’s telecommunications company Huawei. It has sold more than a billion smartphones outside of China – I’ve seen them in Africa, in Asia, in Latin America. And in Mexico, Huawei has fans.

Chinese smartphones on display in Addis Ababa, Ethiopia. (Mary Kay Magistad)

(Sound of soccer crowd)

Adriana Moreno: The best thing that branding made from the consumer side was paying and advertising that we have in a football team in Mexico.

Mary Kay Magistad: Which in America, is soccer.

AM: Yeah – where we put our logo on the t-shirt. That was the best thing ever that we could invest in. 

This is Adriana Moreno, who at the time she’s speaking here, was head of Huawei Latin America’s marketing and communications for businesses, based in Huawei’s regional headquarters in Mexico City. In our interview, she says not so long ago, ‘made in China’ in Mexico meant:

Adriana Moreno: Chinese products, low quality. 

But then came the Huawei sponsorship of a Mexican football team, and Mexicans started to cheer not just for the team, but for Huawei – and for Huawei’s high-quality but affordable phones, tablets and computers. So much so, Adrianna says, that:

Adriana Moreno: We were very amazed to find out that there was a hashtag that the people opened that was ‘I am Huawei’ – in Spanish, ‘Yo Soy Huawei.’ 

That’s what Huawei likes to hear, in Mexico and throughout Latin America, as it promotes its ability to offer end-to-end, all-in-one, 5G networks:

Adriana Moreno: I do believe that these 5G situation is connecting everyone, bringing technology for everyone. I think that is something that can be so dramatically changing our Latin America development.

Huawei’s regional headquarters in Mexico City. (Mary Kay Magistad)

5G – short for the 5th generation of telecommunications systems – is just beginning to roll out around the world. Compared to the current 4G systems, it’ll transmit much more data, much faster, with more capacity and less latency. It’ll be able to power the Internet of Things – communicating with your smart thermostat, smart appliances, perhaps with your driverless electric car. 

But, since 2012, the US government has told US companies to avoid Huawei equipment in general, because of security concerns. These days, that goes especially for Huawei’s 5G, because of everything else that will be built on top of that platform. The Trump Administration, and President Trump himself, have been urging US allies, in Latin America and around the world to avoid Huawei too: 

Donald Trump: We convinced many countries, many countries – and I did this myself, for the most part – not to use Huawei, because we think it’s an unsafe security risk. It’s a big security risk. And I talked many countries out of using it. If they want to do business with us, they can’t use it. 

One concern is that Huawei equipment itself may have vulnerabilities or ‘backdoors’ that allow Chinese state security to access user data – as some US equipment has been discovered to have, sometimes put there on foreign exports – by the National Security Agency, or NSA. Huawei denies having backdoors. Whether it does or not, a Chinese law, passed in 2017, says Chinese citizens and organizations, including companies, must help Chinese intelligence organs if they ask for help. 

Xiao Qiang: So, in other words, if you’re using the Chinese technology, your data is not just in those private companies’ hands, such as Google or Apple. Your data is essentially in the hands of the Chinese Communist Party. 

This is Xiao Qiang. He’s a native of Beijing, now at the University of California at Berkeley’s School of Information. He directs its Counter-Power lab, an interdisciplinary research group that focuses on digital rights and Internet freedom. 

Xiao Qiang: The Chinese Party state, when they have the access of those data and with the technology behind it, they can use it for its own political, economic, security, strategic benefits, which not necessarily at the benefit of the users of these country and governments.

But in Huawei’s Mexico City office, Adriana Moreno insisted when we talked that Huawei equipment and networks are secure: 

Adriana Moreno: We have been open to be analyzed, to be tested, to be reviewed, that that is not a situation that we need to discuss. Because of course, security is one of the most important things that we have, in all the programs that we run and all the products and services that we give. 

MKM: Huawei does not share any of its data with the Chinese government? 

AM: No, we don’t. 

MKM: You’re saying Huawei does not share any of its data with the Chinese government.

AM: I’m saying that we don’t share information with the Chinese government.

MKM: Customer data. Consumer data. 

AM: Yes, correct. 

MKM: Because there’s a law that passed in China that said that if the Chinese government asks companies have to do it. 

AM: I think that all those type of informations are a lot of speculations. 

Xiao Qiang doesn’t buy that:

Xiao Qiang: You will never see in China, Huawei, to say, ‘oh, we don’t provide this data. They may publicly say that. In reality, they actually have the backdoor API in their database, being built, directly being accessed by the Chinese state intelligence, by the Chinese military intelligence. They are so entangled together. It’s more than just a contractual use between the two parties. It’s the lack of the line. 

And, he says, that’s not just true for Huawei.

Xiao Qiang: In China, the issue is this authoritarian state, this autocratic system, is very, very opaque. It’s not transparent. You don’t know what technology are actually being developed and used, and what are the links between the militaries and those Chinese tech companies. What we do know is that none of them are independent from the Party control.

And some countries have more experience than others, in where that kind of state control can lead – Germany, for instance. 

(Sound of walking down hallway)

Felix Mueller: So we’re right in the middle of quite a big compound, the former headquarters of the Ministry for State Security or Stasi, the secret police and intelligence agency of East Germany. 

This is Felix Mueller:

Felix Mueller: My grandfather was a Stasi officer, working for the foreign branch. My father was a policeman, my uncle was a policeman, my other grandfather was a policeman, so I was surrounded by people who really, really thought that the system was good. 

The old Stasi headquarters is now a museum. Felix works here, and is showing an old friend of mine around. 

Melissa Chan: I notice there’s also an archive section, which I think is pretty interesting. Data collection, right? That’s something that the 20th century did very differently from the 21st century. 

This is Melissa Chan. She was a correspondent for Al Jazeera in Beijing, when I was there. And Melissa has long been interested in issues of surveillance, censorship and human rights in China. She now lives in Berlin, and has teamed up with me for this episode. 

Felix is showing Melissa how surveillance was done before the digital age.

Felix Mueller: These index cards are — it’s basically a part of a large system where the Stasi stored letters that they intercepted.

Melissa Chan: So it was the email of the past. Now there are companies or software that would intercept email and look through them, and you don’t need human beings to read the letters. You can just have a machine look for keywords and stuff like that. It used to be all done by people.

FM: So what the Stasi was really concerned is — it’s not the wrong ideas, it’s people spreading these ideas. And this describes how you do that, how you make sure people lose their jobs, don’t find a new job, which at that time was illegal actually, not having a job — so you could end up in prison. Or just use the threat of prison to put pressure on people. Yeah. It’s like a manual how you destroy somebody’s life. 

Today in China, same idea, new tools: 

Graham Webster: The form of generalized surveillance and political repression that most concerns me is the pervasive surveillance of WeChat, which is the chat and everything else app that pretty much all Chinese people who use smartphones are going to be using. 

This is Graham Webster. 

Graham Webster: I’m a research scholar, and I edit the DigiChina project at the Stanford Cyber Policy Center. 

And he lived in China for a few years. We overlapped actually, at a time when many people outside of China still thought the Internet and tech could open China up. China’s Communist Party was never keen on that idea, and under President Xi Jinping, it’s doubled down on control.

A surveillance camera in a Beijing neighborhood. (Mary Kay Magistad)

Graham Webster: You know, it used to be that you could have text messages, or just hang out in restaurants or on the street corner and have relatively open conversations. And now so much happens through WeChat really constantly. It’s like a lot of other places in the world, where people are staring at their smartphones all the time, now, instead of talking to each other. And that stuff is surveilled and it’s censored. And it’s done in a way where there is substantial targeting of people who might discuss something that is especially of concern to the government, but it’s more about the deterrent effect. People are afraid to talk about sensitive issues, because they might get detected and they might get targeted. 

As has been the case for millions of Uighur Muslims, under surveillance, and for hundreds of thousands of them under detention – in China’s western region of Xinjiang.

Graham Webster: I mean the human rights abuses in Xinjiang are nothing short of ongoing atrocities. And there’s a technology element there, in that people who are being targeted may be recognized through facial recognition tools, which by the way, have high error rates and are likely to misidentify people all the time. 

The surveillance cameras that do that are part of China’s Digital Silk Road, too. They’re sold around the world, often but not only to authoritarian countries. They’re pitched as cutting-edge technology that will reduce crime. But as in China, that’s not necessarily how the systems are used on the ground. It’s not even necessarily the case that developing countries get the same AI surveillance systems that China uses, as Melissa found, when she and a New York Times team checked out how Ecuador was using its 4,000-camera system bought from China: 

Melissa Chan: So it was video surveillance, but more of a classic CCTV-style hardware and software, and not really this facial recognition stuff or AI. None of that had been rolled out in any meaningful way. I mean, none. 

This New York Times video shows the surveillance camera control room in Ecuador’s capital, Quito. 

(Sound of New York Times video)

Melissa Chan: And we’re walking around looking at this operations site. And you can see that some of it was people scrolling through, looking at traffic accidents and looking at traffic. But it turned out that it was all manual operations. Like you needed a human to go through all the video cameras. 

And they didn’t have a big staff to do that. 

Melissa Chan: So the reality is that they had the cameras, and people weren’t watching – the government was not watching the video to prevent crime, which was the main selling point for a country and a capital that sees a lot of crime. And you hear a lot of people say, well, yeah, we see these cameras, and robberies take place right in broad daylight, right under the cameras. It’s not fixing the crime problem. But what we did learn, of course, is we spoke to one political opponent of the former government, who said they installed one of these cameras right in front of his apartment, in a district and neighborhood that has a very low crime rate. So that was convenient. Inconvenient for him, but convenient for the government who didn’t like what he had to say. 

One criticism of China’s Digital Silk Road is that it’s exporting tools to help authoritarians. 

But China’s not the only country selling – or using – surveillance equipment. The United States is but one country that both sells and uses it. In fact, a study by PreciseSecurity and CompariTech found the United States has more surveillance cameras per capita than China, more than any other country in the world. Of course, the US cameras don’t have China’s level of unified government control. But a recent study by Harvard’s Belfer Center showed how the United States and China are now top cyber powers, and cyber-competitors: 

Julia Voo: My name is Julia Voo. I’m a cyber fellow at the Harvard’s Belfer Center for Science and International Affairs, formerly the research director for China’s cyber policy. 

Julia led a team at Harvard’s Belfer Center, that put together something called the National Cyber Power Index. It measures different strengths that different cyber powers have or want – like being able to do surveillance at home, or the ability to destroy or disable an adversary’s infrastructure or capabilities abroad, or the ability to defend one’s own cyber capabilities. The index measures both existing abilities, and intent to strengthen those abilities. And on capability: 

Julia Voo: The US came in number one, and number two was China. 

But in terms of intention and drive to gain these capabilities, and be the best at them – China came out on top, including in surveillance technologies. 

Julia Voo: There’s no doubting that Chinese companies are really driving this kind of global supply of equipment for surveillance around the world. Actually, I think the Carnegie Endowment for International Peace did a really great study on this, basically mapping which countries are adopting the technology, but also what companies are supplying it, and China came out on top, I think by a country mile. 

But the US, Israel and some European countries also sell surveillance equipment, and some would say, it’s just business. Some also do their own surveillance, at home and abroad. Edward Snowden’s 2013 revelations of just how much surveillance the United States had been doing – including on allies like German leader Angela Merkel, still stings in Germany. 

Anne Roth: I think Snowden showed us how the innocence of the belief in the free internet that was facilitating more openness, more transparency, more democracy, was basically not there anymore.

Anne Roth is a policy advisor for a German parliamentary group called the Left. She talked to Melissa in Berlin.

Anne Roth: My point of view in this is that any kind of mass surveillance happening in communications infrastructure is very bad for any type of democracy because once you know that you’re being surveilled, you change the way you behave, you change the way you talk, and personally I don’t really care who the surveillance is coming from. I think all of this is really bad.

That said, some Europeans were left feeling, after the Snowden revelations, that if both the US and China could spy through their telecommunications networks, why not just go with the one that was cheapest? On top of that, says Julia Voo, it’s costly to switch providers when transitioning from 4G to 5G: 

Julia Voo: Unless the governments have the money to rip out and replace, it’s not going to happen. Also if 5G – the components that Huawei have developed – if they are the best in market and if they are cost effective, why would you? 

That’s a question that applies at least as much to developing countries, in Africa, Latin America and Asia. In Europe, Julia says, Europeans don’t like being caught in the middle of a US-China tech rivalry:

Julia Voo: In a meeting with Xi Jinping, three European leaders basically were saying, ‘in this US-China geopolitical conflict, Europe is a player and not the playing field.’

And yet, European attitudes toward Huawei and Chinese tech are changing. Whether because of US pressure, or because of their own review of risks, a growing number of European countries – the UK, France, Germany, Belgium, and Italy among them – have chosen partners other than Huawei for their 5G networks, or are considering that step. Several are also phasing out existing Huawei equipment. 

(Sound of walking down hall, and door opening) 

In Italy’s business capital, Milan, one European suggests a pragmatic reason why it’s in Europe’s interests not to use Huawei 5G. 

Stefano Zanero: My name is Stefano Zanero. I’m an associate professor at the Politecnico di Milano, which is Italy’s largest university of engineering. We have 42,000 students and according to some rankings, we are university number 16 in the world for engineering.

We’re talking in a basement lab, with tangerine and lemon yellow walls, and with Legos in front of us, and a foosball table in the next room. Very Silicon Valley. Stefano actually takes his top students there, and to DEF CON Capture the Flag, where they compete in white hat hacking – That is, they attack computer networks to see if their defenses hold up, as a way of helping those systems improve their defenses.

Stefano says honing skills like these is crucial for Europe’s tech future. So is fostering the know-how to build 5G networks, and all that will be built on top of them: 

Stefano Zanero: Now, the choice of who you ask to build the 5G network is important because, whoever gets the most contracts will have more resources to do research. So in 10 years we will be building the 6G network. If we give a lot of contracts for 5G networks to a single player, there’s going to be a single player able to build the next generation network. 

That alone, he says, is a good reason to support the two European countries doing 5G – Ericsson in Sweden and Nokia in Finland. So is the fact that whoever controls a country’s strategic infrastructure has leverage over the client, and could, perhaps say, ‘we’re not going to do maintenance. We’re not going to give you any more spare parts.’ And then there’s this:

Stefano Zanero: Cultural elements are embedded in the way that technology is built. For a Chinese engineer, the concept of building, for instance, a way for a legitimate authority to snoop into a conversation, I think is way less of an ethical problem or of a mental problem than for an engineer in the US. In particular in the US, I think, most citizens feel very strongly about defending their First Amendment rights. They feel so strongly about it that it is the First Amendment to the US Constitution, right? It’s kind of an important deal. 

Mary Kay Magistad: People fought and died for this. 

SZ: Right. And the same happened in Italy. The Italian constitution says exactly the same thing as the First Amendment says. It protects the right of people to express their opinion, in particular if their opinion is critical of the government. So that’s the value we share. And that value in some ways ends up being built in the technology we build. And the Chinese applications, you can bet on it, express their own cultural values. 

(Music)

Cultural values are also embedded in standards, norms and regulations governing the use of technology. And the Chinese government has become increasingly active on that front, in the United Nations and elsewhere – even as China’s president, Xi Jinping, has increasingly called on China’s military and civilians, state enterprises and private ones, to work together toward a common purpose – what he calls The China Dream – of China becoming the world’s premier power – on earth, and ideally, in space.

(Sound of Chinese rocket lift-off)

In early 2019, a Chinese spacecraft landed on the far side of the moon – a first for any nation. The Chang’e-4 probe and its rover took photos, tried to grow cotton, potatoes and yeast, and hatched fruit flies, testing what’s possible on the moon’s surface. They also sampled the mineral content on the moon, did radio astronomy, and used radar to probe 300 feet down. China is working toward putting Chinese on the moon – more than half a century after Americans walked on it. 

Plinio Innocenzi: It’s ok. But, sincerely, in Europe and the United States, we are going to Mars. They are still going to the Moon. 

This is Plinio Innocenzi. He’s a former science attaché at Italy’s embassy in Beijing. Plinio is also a physicist who worked with the Italian space agency. He talks here as he serves coffee at his home in Milan.

Plinio Innocenzi, a former science attaché at Italy’s embassy in Beijing. (Mary Kay Magistad)

Plinio Innocenzi: Space is fundamental for any military application, because it means telecommunication. Telecommunication, and the guide for ballistic missiles, you need to guide from space. So it’s very critical, the control of the space. Who is controlling space has a military technological advantage, which is enormous. Think to blind all of the communication in the other country, the country’s data. Now all is going through the satellite. Also the fact that you can observe to know exactly what is going on with a level of detail, which is incredible. So space is fundamental. Who is controlling space is controlling the world.

Many of the technologies China is now honing can be used in its space program for scientific, commercial or military purposes, just like similar technologies from the United States have been over time. China has, for instance, tested technology that can destroy satellites – creating a fair bit of space debris in the process.

Still, Plinio thinks it makes sense to cooperate in space, at least on the scientific front. When he was in Beijing, he helped organize a joint Sino-Italian scientific space mission.

Plinio Innocenzi: Working on this with China was extremely important because we – there was a long discussion. But you know the data in China, the idea is that the data in China cannot go out of China. We have to convince China, scientific data are a common property of the people, of the scientists in the world, to be open. Something so simple, but for China it’s not obvious. And the data of the Sino-Italian satellite are open to all scientists in the world. 

Those kinds of changes come through cooperation, he says, even when your values don’t entirely line up. He thinks it was a mistake for the United States to isolate China for years from any cooperation in space – though, there was some cooperation around the Chang’e-4 mission. 

But from the perspective of the US military, given that the US and China, and now the European Union and China, are systemic rivals, why help China catch up on strategic capabilities any more quickly than it’s already doing? 

Michael Brown: Where China is already ahead – you see a lot of important technologies on the left where China already has the lead. 

This is Michael Brown, director of the US Defense Department’s Defense Innovation Unit. He’s speaking at a virtual Stanford-Hoover Institution conference on Digital Authoritarianism. His slide shows China ahead in facial recognition software, cryptocurrency, small drones, electric batteries and electric vehicles, solar energy, quantum communications – which can ensure encrypted communications for the user, while cracking everyone else’s encryption – and 5G. 

Michael Brown: Here’s where we were, as a country, asleep at the switch. Over time, we’ve let our key telecommunications equipment suppliers leave the United States. And so there, you could argue, we’re already pretty far behind, and we either need to be neutralizing China’s advantage, with something like the open radio access network, which is being promoted now, how you virtualize 5G so our software strengths come into play, or we’ve got to leapfrog them and go into 6G.

This matters not just for ease of using the Internet, but also for strategic reasons. Mike Brown said in his talk that of eight key technologies China is developing for military use, seven are commercial technologies. And journalist Melissa Chan says many of China’s commercial technologies could be put together to make effective weapons: 

Melissa Chan: In the Digital Silk Road space, you see this with, for example, China dominating the small drones market globally, Chinese companies doing really well with facial recognition. Okay. So those are two separate things. But it wouldn’t be really hard to combine a drone with facial recognition technology from another Chinese company, and suddenly, it’s a weapon of war. 

Innovations work both ways – commercial to military, and military to commercial. 

Innovations have come out of defense research in the United States – the Internet, radar, GPS. Silicon Valley itself sprang out of defense investment in the 1960s. It was at a time when the US government invested in innovation and technological advances just like China’s doing now. Mike Brown says the US government urgently needs to do more of that kind of investment – the kind that once sent men to the moon. 

Michael Brown: We need to really imagine launching or ushering in a new era of technological achievement. And that happens when we combine the strengths of government-set moonshots, all the strengths of academia, and government money flowing through those systems, to make sure that we can realize those goals. The last goal we had like that that I can remember was sequencing the human genome – a fantastic achievement. We need to be multiplying that times ten, in terms of setting ambitious goals, inspiring our young people to pursue areas like this with their future, and ensuring we get the long-term thinking and investment that government can provide, that doesn’t require that immediate return.

That could start with Congress being more willing to allocate money for basic research. But another theme at this conference was that the United States needs to work more closely with its allies, and set a better example of embedding democratic values in how tech and all things digital are regulated. Graham Webster, from the DigiChina project at Stanford’s Cyber Policy Center, couldn’t agree more: 

Graham Webster: Take seriously the regulation of US tech. I mean, the US tech giants are not significantly regulated. We had a situation, the last election where bad actors from Russia were able to try to manipulate people’s views and behavior, using the Facebook ad platform. And there’s been a lot of pressure and Facebook has made efforts to try to change things, but it still looks like quite a mess. 

But Graham thinks there is a way forward that could begin to change that.

Graham Webster: I think if the U S companies, much to their chagrin, are forced to develop adaptations to their products that really consider and ensure democratic integrity and really respect privacy, freedom of expression, and in a fairly costly way, I’m sure, reconfigure their business models so that the whole thing isn’t depending on people paying to manipulate your behavior through advertising, then these could be some pretty darned compelling products around the world, right? If there’s a whole technological ecosystem that is more respecting of freedoms and privacy and data security, then that would contrast with the Chinese offerings, which are built for surveillance and manipulation and, frankly, for lower cost. 

Meanwhile, what the Trump Administration has done is make it much harder for Huawei to get semiconductors – the chips that drive our digital world. 

China does not yet have the know-how, nor the sophisticated fabrication plants, to make these. Most are made in the United States, Taiwan, South Korea, Japan and the Netherlands. 

Graham Webster: And basically, all of the top semiconductors now are designed using software that can be regulated by the US government So in the case of someone like Huawei, who’s been targeted by the US government for many years, if they are completely cut off from the most advanced semiconductors, that could slow their progress in various types of applications all over the map, from the cell phones that they sell with the really good cameras, to the 5G infrastructure that the US government really wants to prevent from being widely adopted around the world.

Which might be a US advantage in the short-term, but in the longer term, Graham says, that could lead to a splintered Internet: 

Graham Webster: The Chinese government has been determined to build a more independent capacity in things like semiconductors for a long time. Now there’s absolutely no reason for them to back off on that. Now there’s reason to go faster and faster and to just make all efforts to catch up, because the US has demonstrated that it’s willing to use this core technology as leverage or as a way to undermine crucial Chinese companies.

One school of thought is once China starts breaking away, and creating a separate Internet, with separate standards and norms, the argument goes it’ll bifurcate the world, with the US and its allies on one side, and on the other – authoritarian states, sure, but also developing countries that perhaps could only afford to buy Chinese technology, and not the more expensive stuff – especially if the quality is roughly comparable. And, that argument says, it would be hard, if not impossible, to put the splintered Internet back together again. As Google’s former CEO, Eric Schmidt said in the Stanford/Hoover Institution virtual conference on Digital Authoritarianism: 

Eric Schmidt: I would like America to win. And the best way for us to win in these technologies is to have global platforms, which are also used by China. 

But Melissa says China is already blocking or censoring many of those technologies: 

Melissa Chan: China kind of decoupled from the world and the United States technology quite a number of years ago, when they started banning Google, banning Twitter, banning Facebook, banning Snapchat, banning Instagram. And at the time the narrative was that ‘this is about censorship.’ Well, in hindsight we see that it’s about censorship, domestically, but it’s also about decoupling. I mean, it’s unclear the motivation of what they were thinking about at the time, but the result of it has been economic decoupling, technological decoupling, and its own internal ecosystem. And you know, 1.4 billion people is a significant part of the world. So in terms of international standards, I suppose you can look at this and say, they’ve made a lot of headway to start on many fronts.

And that might sound bleak, for those who look at how China’s technological prowess is being used for repression in Xinjiang, and now in Hong Kong, and how China’s own social credit system, has blocked millions of Chinese citizens from buying plane or hi-speed train tickets, because of some transgression. Some local governments are even experimenting with including political transgressions in the mix. But there’s another majority Chinese society that’s keeping its digital space open, as Melissa found on a visit to Taiwan.

Audrey Tang: We are on the front lines of the global confrontation with our authoritarianism. 

This is Audrey Tang, Taiwan’s Digital Minister, in charge of social innovation, open government, and youth engagement. She says Taiwan’s approach is in sharp contrast to China’s control of the Internet, and its blocking of websites it doesn’t like – known as the Great Firewall. 

Audrey Tang: And with the Belt and Road, a lot of the export include the Great Firewall and related technologies that are just predicated on the fact that they consider that it should be radically transparent, but it’s from the citizens’ radical transparency to the state. Whereas in Taiwan, we consider that it’s the state’s mandate to make the state radically transparent to the citizens.

Taiwan is a Chinese democracy – as in culturally Chinese – a fact that messes with China’s Communist Party leaders’ argument that democracy is incompatible with Chinese culture. Actually Taiwanese political rallies are very enthusiastic: 

(Sound of Taiwanese political rally)

I’ve covered many elections there, including Taiwan’s first presidential election in 1996, which China’s leaders so opposed that they did missile tests in and near the Taiwan Strait, apparently to try to intimidate Taiwan’s voters. That didn’t work, but it did cause two US aircraft carriers to move through the Taiwan Strait, to send a message.

 More recently, just in September 2020, Chinese military surveillance planes flew on three straight days, into Taiwan’s air defense identification zone. 

These are things Taiwan has to manage, as an entity that’s never been under the control of the People’s Republic of China, but which China’s leaders claim as part of China. Taiwan has learned over time to defend its separate space. 

Audrey Tang’s job is to do that in cyberspace, starting with 4G and 5G infrastructure. 

Audrey Tang: Around five years ago, when the parliament here was occupied, one of the largest debates was whether we would allow PRC so-called private sector components into our fourth generation infrastructure. So that was when 4G was still being deployed and rolled out in Taiwan. And at the time, which was 2014, we did a systemic risk analysis that asks this question: even if they passed all the cyber security Internet standard audits today, if the network suffers from some catastrophic bug, which may or may not be intentional, would [we] accept the risk that they could push an update that we must activate in a very short timeframe, and the fact that this so-called private-sector company, may become de facto state-controlled, using non-market forces? And the answer from that risk assessment is that the risk is too high. We simply cannot do that. 

But when it comes to all things tech-related, Taiwan is entangled with China. Hundreds of thousands of Taiwanese have lived and worked in China. There are many Taiwanese tech-related factories in China, including Foxconn – which assembles Apple products. And, Mainland China is Taiwan’s top trading partner. It accounts for almost a quarter of Taiwan’s total trade, double the US proportion. And one of Taiwan’s important exports to China is semiconductors, including to Huawei.

Jason Hsu: So historically, Taiwan has quite a heavy dependence on the trade with China, with over $200 billion US dollars with trade surplus to China. 

This is Jason Hsu. He’s a former tech entrepreneur, and a former Taiwanese legislator with the Kuomintang Party, the one founded by Chiang Kai-Shek, that ruled China in the 1930s and ‘40s, and then fled to Taiwan when the Communist Party took power. 

Jason Hsu: And with the Belt & Road Initiative – it’s actually impacting Taiwan on quite a large scale. 

He says the Belt & Road Initiative offers an opportunity to Taiwan, but with some risks, especially related to the Digital Silk Road. 

Jason Hsu: With the current China and US trade war, that is escalating into the next phase, which is the high-tech war.

US sanctions forced Taiwanese companies to halt sales. That could have caused them to take a real hit. But Taiwan’s top semiconductor company, TSMC, ended up finding other buyers. And it now plans to open a $12 billion manufacturing plant in Arizona – which will help secure US supply. 

Jason Hsu says the United States and Taiwan should work more closely together in other ways too, to build a digital future that best suits democracies. One step toward that, In October 2020, the Kuomintang Party proposed, and Taiwan’s legislature unanimously passed, two resolutions on strengthening ties with the United States:

Jason Hsu: Taiwan has a lot of talented engineers and cyber hackers and yet we are under such a ferocious cyber attack from China. On a daily basis, we are hit over 30-thousand times. Our government websites and database are hit quite a lot. And so if US and Taiwan can team up to build the cyber security front for the Indo-Pacific, using Taiwan as a fortress to train the cyber security talent and to develop technology, and then to use Taiwan as a hub and as the first line on the Indo-Pacific, I think this would be a very important strategic plan to do.

That could certainly put a speed-bump or more on China’s Digital Silk Road, as US pressure and other governments’ reassessments of risks have already done. But China’s goals are clear, with momentum on its side, from hundreds of billions of dollars spent over the past two decades, to increase innovation and build up expertise in cutting edge technologies. 

Even without its great global ambition, China would have incentives to invest in a hi-tech future. Its economic growth is slowing, its population is aging, and China’s tech industry has been an effective engine driving China’s economic growth over the past decade. The vision is for that to continue, as China’s Digital Silk Road rolls out around the world, offering high quality and value-for-money, if not always the values embedded in that technology that all those on the receiving end might choose.

(Music)

Thanks to Melissa Chan, my partner reporter for this episode. She reported both from Germany and Taiwan. Thanks, too, to Laura Daverio, who reported with me in Italy, and to Isabella Cota, who shared the reporting in Mexico. Shuang Li contributed Chinese-language research for this episode, and for the whole series. 

Our editor is Dave Rummel. Our sound designer for this episode is Jennie Cataldo. Our executive producer is Christine Brandt.

On China’s New Silk Road is a production of the Global Reporting Centre, a nonprofit group that teaches, practices and promotes innovation in global journalism. Peter Klein is the GRC’s founder. Philippe LeBillon, a Global Reporting Centre partner and geography professor at the University of British Columbia, provided valuable input to this series. 

On China’s New Silk Road, was made possible by generous funding from Humanity United, and from the Social Sciences and Humanities Research Council of Canada. You can find photos, transcripts and more at globalreportingcentre.org. While you’re there, check out other great journalism from the Global Reporting Centre. 

Up next, we head to India, which isn’t wild about China’s vision of the Asian Century: 

Unidentified voice: So, naturally, we have to be concerned about what this means in terms of constraining India’s own options as far as, even its own neighborhood is concerned. The problem is that India by itself simply does not have the scale of resources that China has to come up with an alternative. 

But working with the United States and others who want a different kind of future for Asia and the world, might be an option. The Other Asian Giant, next, on China’s New Silk Road.

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