China’s Digital Identity Schema Propels Nationalist Tech Ambitions

August 14, 2020
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In the second part of our series on nationalism and its threat to digital identity, we analyze China, the chief proponent of cyber sovereignty. We analyze the primacy of nationalism as a tool for maintaining political control in China, as well as the importance of technology for validating the nationalist idea that China is a formidable global power.

The Trump administration’s announcement of the Clean Network program, in tandem with twin bans of Tiktok and Wechat, has stoked fears of an increasingly fragmented Internet and a brewing Tech Cold War. The underlying current of the burgeoning Tech Cold War is the global rise of nationalism. COVID-19 has cast doubt on the viability of globalism, as global supply chains have been heavily disrupted and travel bans continue to be the norm. The potential retreat from globalism has only played into the hands of the rising number of nationalist governments around the world; notable examples include the U.S., Brazil, and India

Two key reasons are driving tech to the foreground in the global competition between nationalist ambitions. The first is data as both a weapon for national security purposes and a tool for national governance; the second is technological might as a proxy for global power and influence. China’s prioritization of foundational digital identity concepts has helped them succeed in both aspects.

Though China rose to power as the factory of the world, the government has long recognized the importance of technology to their long-term growth. To spur the growth of its own tech industry, China has been a strong proponent of “cyber sovereignty,” a concept that essentially states that national sovereignty extends beyond physical barriers into cyberspace. Therefore, governments, not companies or individuals, have ultimate control over the Internet for its citizens. Cyber sovereignty has traditionally been casted as the diametric opposite to the idea of a free and open internet. These two models of the internet are symbolic for a broader ideological conflict between authoritarian and democratic governments. 

As is often pointed out, authoritarian governments can weaponize cyber sovereignty to curb citizens’ freedoms on the Internet and influence the tech industry to serve their own means. (Ironically enough, the Trump administration is targeting Chinese tech partly because cyber sovereignty allows the Chinese government undue control over private tech companies, but the administration is ultimately adopting China’s vision of the Internet in doing so.) 

The Chinese government has used cyber sovereignty to encourage the growth of juggernauts like Tencent and Alibaba, while also compelling these firms to advance the state’s initiatives (e.g. censorship on WeChat). However, their methods have become increasingly aggressive under Xi Jinping’s rule, as Xi uses nationalism to maintain power, especially in light of COVID-19, slowing economic growth and his ambitions for an unprecedented third term in office (which would make him the longest-reigning leader since Mao Zedong). The sweeping crackdown on Hong Kong, gradual encroachment on the South China Sea, and detention of Uyghurs to promote ethnocentrism are all examples of how Xi strategically uses aggression to amplify external threats–around which Chinese citizens can unify–and tamp down any and all differences within the nation.

The Chinese government’s nationalist agenda can be bifurcated by outward-facing diplomatic agendas–e.g. their recent actions against Hong Kong–and inward-facing campaigns to cultivate patriotic pride in their citizens. In matters of data privacy and technological might, these foreign and domestic campaigns are deeply intertwined.

Outwardly, the ambition has been to solidify their status as a global power by becoming a world leader in technology, as suggested by their Made in China 2025 initiative. Mass influence campaigns are another potential route through which the Chinese government seeks to exert power, but there is less evidence supporting this (though not none). 

Meanwhile, China’s inward-facing tech policy is focused on promoting a peaceful society toward influence campaigns and economic growth via tech advancements. The government uses tech companies to crack down on dissent and imbue patriotism in Chinese citizens. In addition, the Chinese government acknowledges the growth of tech itself is necessary to fuel the continued growth of its economy, and in doing so, keep the tacit promise it has with its citizens of ensuring economic vitality in exchange for uncontested control.

Via their digital identity regime, the Chinese government has effectively implemented an invasive and sophisticated surveillance system that at once accomplishes both outward and inward nationalist agendas. China is now widely-regarded as a world leader in biometric and AI technology, which not only powers their surveillance system, but also has allowed companies like Sensetime, Megvii, and iFlytek to become multi-billion dollar companies.

A digital identity regime that can effectively track all user activity, online and offline, benefits more than just biometric companies and the government though. China’s sophisticated digital identity system essentially creates a data economy that stands to be incredibly powerful because of its ability for this data to be linked with a high degree of accuracy. In this way, their digital identity system is key to unlocking new breakthroughs in tech for China. Such a data economy can train AI algorithms to generate highly-targeted ads, create sophisticated fraud prevention tools, and more. Not coincidentally, Tiktok’s secret sauce is widely considered to be their AI formula that makes the likes of Facebook’s and Youtube’s look unsophisticated in comparison.

TechNode notes that China’s new Data Security Law reflects the importance that the Chinese government places on data. In enacting the law, the Chinese government seeks to regulate the data economy to serve its national security and economic benefits. I would also argue that nationalism plays an important role in the law as well. As part of China’s new civil code, the law is presented as legislation to protect citizens, not state interests. Specifically, the laws have a strong personal privacy component that is seemingly in response to rising privacy concerns of Chinese citizens.

As I have argued, the Chinese government does not rule simply by enforcing their will on its citizens. They are in fact highly sensitive to the wills of their citizens, because winning citizen favor is critical for the continued success of nationalist campaigns seeking to instill patriotism into Chinese citizens.

The Chinese government’s success in promoting nationalist sentiment and, specifically, positioning the Internet as a key battleground for its nationalist ambitions can be seen in Chinese citizens’ responses to the potential sale of Tiktok. While Tiktok battles scrutiny over its roots in China, parent company Bytedance is facing similar criticism in China over their perceived kowtowing to U.S. policy. Bytedance CEO and founder Zhang Yiming hid all his posts on Weibo, a popular social media platform, in response to a torrent of backlash from Chinese citizens. 

However, now that other countries are starting to play China’s game of cyber sovereignty, has China actually won? The same policy that has propelled their tech industry is now threatening to undercut its growth. Countries are beginning to erect firewalls of their own against China’s technology. Even some Chinese technologists might argue China’s cyberspace strategy has backfired. The founder of the popular travel booking platform Ctrip James Liang, in a now deleted post, has called for China to move towards a more open Internet to preserve the prosperity of China’s tech industry. 

The national security concerns expressed on both sides may have legitimacy, but wholesale banning of apps does a disservice to citizens by taking away the freedom of choice and styming economic growth. Instead, strong regulation–such as that prescribed by Kevin Xu in his blog– would address both legitimate concerns over data privacy and security, while preserving citizen choice and strengthening digital identity schemas for international cooperation. We will take a closer look into Europe next week, as the region takes the lead in enacting strong regulation to secure data privacy flows and further national interest.

But, as data continues to become an increasingly important tool for national governance globally and tech companies grow in power, it is unlikely that China will back down the escalating tit-for-tat Tech Cold War. To do so would be to run counter nationalist sentiments that sustain power in not just China but, increasingly, in today’s global order.

As always, we’ll be back next week with more insights and fresh perspectives. But if you’re looking for more, join us at our next digital forum and gain the most up-to-date learnings from our OWI experts and many others from across the landscape. You can thank us later.