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Is China cooking the books on its economy?
Is China cooking the books on its economy?

Spectator

time4 days ago

  • Business
  • Spectator

Is China cooking the books on its economy?

A Western financial analyst based in Shanghai once described China's economic statistics to me as 'one of greatest works of contemporary Chinese fiction'. Not even the Communist party's (CCP) own officials believed them. A cottage industry of esoteric techniques developed to try and measure what was really going on, ranging from diesel and electricity demand to the fluctuating levels of the country's chronic air pollution, car sales, traffic congestion, job postings and construction – even the sale of underwear or pickled vegetables. One enterprising analyst regularly sent spies to Shanghai port to count the ships and throughput of trucks. I thought about that conversation again this week when China's National Bureau of Statistics published new figures claiming that the economy grew by 5.2 per cent in the three months to the end of June and thereby 'withstood pressure and made steady improvement despite challenges'. Growth figures have always been political rather than economic in China but have become even more so as Beijing seeks to demonstrate that its economy is resilient enough to withstand any further tariffs that Donald Trump might throw at it should their fragile trade truce break down. I have no idea what new techniques the hapless Shanghai analysts are now deploying, but questioning the official figures has become increasingly dangerous in the China of President Xi Jinping. Shortly before Christmas, Gao Sanwen, a top economist and former official at China's central bank, cast doubt on official figures, telling a conference in Washington DC that China's growth over recent years was likely just 2 per cent, which is less than half what the government had claimed. Gao then promptly disappeared from view. Online commentaries in which he had also highlighted soaring unemployment, China's 'dispirited youth' and 'disenchanted middle-aged' were deleted by censors. A few months earlier, Zhu Hengpeng, a top economist with the Chinese Academy of Social Sciences' Institute of Economics also disappeared after making disparaging remarks about Xi Jinping's economic stewardship in what he thought was a private online chat group. It is more difficult than ever to tell what is really going on with the Chinese economy since the CCP has effectively criminalised pessimism. The Ministry of State Security, its main spy agency, has declared that gloom about the economy is a foreign smear and that 'false theories about 'China's deterioration' are being circulated to attack China's unique socialist system'. It could well be that China's economy did get a bounce in the three months to the end of June as factories ramped up production and pumped out more exports in order to beat any future tariffs. The government has also attempted to boost consumer demand with a trade-in programme worth an estimated $42 billion (£31.3 billion) so far this year, covering a range of consumer goods, from washing machines to electric vehicles (EVs), air conditioners, smartphones and tablets. Xi has pledged to 'fully unleash' China's consumers, but retail sales actually slowed in June, with consumers cautious in the face of a continuing property slump and a deteriorating jobs market. Housing accounts for around 70 per cent of Chinese household wealth, and with prices continuing to fall, consumers appear to be in no mood to be unleashed. Meanwhile, the CCP has begrudgingly acknowledged that the economy is chronically overproducing, notably in renewable tech, such as batteries, EVs and solar panels – though the party will not bring itself to use that term. Instead, it has embraced the term 'involution' (neijuan in mandarin), which describes what it sees as unhealthy and self-destructive competition, which it acknowledges is fuelling deflation and undermining growth. What it doesn't acknowledge is that this is a direct result of its own policies – the enormous subsidies thrown at these industries, which in turn is fuelling global wariness about being the target of Chinese exporters desperate to dump this stuff. The CCP has set a full-year growth target of around 5 per cent, and by hook or by crook it will hit that, no matter what is really going on in the economy. It is not simply a matter of the Chinese government cooking the books, since creating this particular work of fiction is more complex than that. The Chinese economy is a surreal organism, which simply can't be measured by the tools that would usually be brought to bear in other developed economies. The system creates perverse incentives whereby officials at every level are under enormous pressure to manipulate data in order to be seen to fulfil the party's growth targets, for which they are rewarded or punished. Add to that mix a brewing trade war with America and you are left with statistics that are more political and untrustworthy than ever. My Shanghai analyst soon found another proxy for measuring economic activity – the throughput of visitors at Shanghai Disneyland. I said that felt a little far-fetched, which he acknowledged, but pointed out that a morning in the company of Mickey Mouse was a lot more fun and potentially more productive than dealing with officials at the National Bureau of Statistics.

China introduces stricter online control with internet ID
China introduces stricter online control with internet ID

Tahawul Tech

time23-06-2025

  • Politics
  • Tahawul Tech

China introduces stricter online control with internet ID

China is well known for operating one of the world's most extensive online censorship and surveillance regimes. With mandatory identity checks on every online platform anonymity is next to impossible. But this rigidly moderated online environment is about to face even stricter controls with the introduction of a state-issued national internet ID. Instead of requiring individuals to submit their personal information for identity checks separately on each platform, the government now seeks to centralise the process by issuing a virtual ID that will allow users to sign in across different social media apps and websites. The rules for the new system, currently voluntary, were released in late May and will be implemented in mid-July. It aims to 'protect citizens' identity information, and support the healthy and orderly development of the digital economy,' according to the published rules. Experts, however, have raised concerns that the new policy will further erode already limited freedom of expression by forcing internet users to relinquish even more control to the state. Since Chinese leader Xi Jinping took power in 2012, the country has further tightened its grip on the digital space through an army of censors. Deployed around the clock, they remove posts, suspend accounts and help authorities identify critics, quashing any sign of dissent before it can gain traction. The finalised rules were announced after a proposal that was opened for public comment last summer, a typical step in China's legislative process. During the course of the public consultation over the past year, the proposal faced backlash from law professors, human rights experts and some internet users. Yet, the finalised rules remained largely similar to the draft. 'This is a state-led, unified identity system capable of real-time monitoring and blocking of users', said Xiao Qiang, a research scientist studying internet freedom at the University of California, Berkeley. 'It can directly erase voices it doesn't like from the internet, so it's more than just a surveillance tool – it is an infrastructure of digital totalitarianism'. Control of China's vast portion of the global internet has largely been delegated to a decentralised range of different groups, with authorities relying partially on the social media platforms themselves to identify comments deemed problematic. Xiao warned that a centralised system using the internet ID could make it much easier for the government to wipe out a user's presence across multiple platforms at once. Shane Yi, a researcher at China Human Rights Defenders, an advocacy group, echoed Xiao's worries. The system gives the Chinese government expanded power to 'do what they want when they see fit' on the internet, as authorities are able to track users' entire digital trail 'from point zero,' she said. At home, Chinese state-run media has called the internet ID a 'bullet-proof vest for personal information' and touted the system as being able to greatly reduce the risk of personal data leaks. Already, more than six million people have registered for the ID, according to Chinese state-run media Xinhua last month, out of a total estimated online population of more than one billion. A cybersecurity official from the Ministry of Public Security told Xinhua that the internet ID service was strictly 'voluntary,' but the government encourages various industries and sectors to integrate with it. 'Its goal is to provide individuals with a secure, convenient, authoritative and efficient means of identity verification, in support of the development of the digital economy,' the person was quoted as saying. But experts have also questioned how voluntary the system truly is and highlighted risks of potential data breaches, as personal information is now being collected in a centralised manner. Haochen Sun, a law professor at the University of Hong Kong, said that, although the law presents the system as voluntary, it could gradually evolve into a system which users may struggle not to opt in to. 'If the government wants to promote this internet ID verification system, it can do so through various arrangements – essentially by encouraging people to adopt it, offering more conveniences in return,' he said. Sun also raised concerns about the increased risks of data leaks. 'A centralised, nationwide platform inherently creates a single point of vulnerability, making it an attractive target for hackers or hostile foreign actors,' he said. Government data breaches have occurred around the world. One notable incident in China involved a police database containing the personal information of one billion citizens being leaked online in 2022. Lao Dongyan, a prominent law professor at Tsinghua University, compared the system to 'installing a surveillance device on every individual's online activity' in a post on Weibo, an X-like Chinese social media platform. The post was removed soon after, and her account was subsequently suspended from posting for three months, for 'violating relevant rules.' In late May, when the finalized rules were unveiled after a year, almost no criticism could be found online. Xiao explained that it's not the first time authorities have spaced out the time between a proposal and its implementation, to allow critics to 'blow off steam'. 'It's done deliberately … Many of their measures follow the same pattern, and they've proven effective,' he said. Source: CNN Image Credit: Stock Image

China tightens internet controls with new centralized form of virtual ID
China tightens internet controls with new centralized form of virtual ID

CNN

time20-06-2025

  • Politics
  • CNN

China tightens internet controls with new centralized form of virtual ID

China has mastered the craft of policing the internet, operating one of the world's most extensive online censorship and surveillance regimes. With mandatory identity checks on every online platform, it has become almost impossible for users to stay anonymous. But this rigidly moderated online environment is about to face even stricter controls with the introduction of a state-issued national internet ID. Instead of requiring individuals to submit their personal information for identity checks separately on each platform, the government now seeks to centralize the process by issuing a virtual ID that will allow users to sign in across different social media apps and websites. The rules for the new system, currently voluntary, were released in late May and will be implemented in mid-July. It aims to 'protect citizens' identity information, and support the healthy and orderly development of the digital economy,' according to the published rules. Experts, however, have raised concerns that the new policy will further erode already limited freedom of expression by forcing internet users to relinquish even more control to the state. Since Chinese leader Xi Jinping took power in 2012, the country has further tightened its grip on the digital space through an army of censors. Deployed around the clock, they remove posts, suspend accounts and help authorities identify critics, quashing any sign of dissent before it can gain traction. The finalized rules were announced after a proposal that was opened for public comment last summer, a typical step in China's legislative process. During the course of the public consultation over the past year, the proposal faced backlash from law professors, human rights experts and some internet users. Yet, the finalized rules remained largely similar to the draft. 'This is a state-led, unified identity system capable of real-time monitoring and blocking of users,' said Xiao Qiang, a research scientist studying internet freedom at the University of California, Berkeley. 'It can directly erase voices it doesn't like from the internet, so it's more than just a surveillance tool – it is an infrastructure of digital totalitarianism.' Control of China's vast portion of the global internet has largely been delegated to a decentralized range of different groups, with authorities relying partially on the social media platforms themselves to identify comments deemed problematic. Xiao warned that a centralized system using the internet ID could make it much easier for the government to wipe out a user's presence across multiple platforms at once. Shane Yi, a researcher at China Human Rights Defenders, an advocacy group, echoed Xiao's worries. The system gives the Chinese government expanded power to 'do what they want when they see fit' on the internet, as authorities are able to track users' entire digital trail 'from point zero,' she said. At home, Chinese state-run media has called the internet ID a 'bullet-proof vest for personal information' and touted the system as being able to greatly reduce the risk of personal data leaks. Already, more than six million people have registered for the ID, according to Chinese state-run media Xinhua last month, out of a total estimated online population of more than one billion. A cybersecurity official from the Ministry of Public Security told Xinhua that the internet ID service was strictly 'voluntary,' but the government encourages various industries and sectors to integrate with it. 'Its goal is to provide individuals with a secure, convenient, authoritative and efficient means of identity verification, in support of the development of the digital economy,' the person was quoted as saying. But experts have also questioned how voluntary the system truly is and highlighted risks of potential data breaches, as personal information is now being collected in a centralized manner. Haochen Sun, a law professor at the University of Hong Kong, said that, although the law presents the system as voluntary, it could gradually evolve into a system which users may struggle not to opt in to. 'If the government wants to promote this internet ID verification system, it can do so through various arrangements – essentially by encouraging people to adopt it, offering more conveniences in return,' he said. Sun also raised concerns about the increased risks of data leaks. 'A centralized, nationwide platform inherently creates a single point of vulnerability, making it an attractive target for hackers or hostile foreign actors,' he said. Government data breaches have occurred around the world. One notable incident in China involved a police database containing the personal information of one billion citizens being leaked online in 2022. Although the new rules won't take effect until mid-July, hundreds of apps started trialing the internet ID since last year. The system was born out of a proposal by a police official early last year. Jia Xiaoliang, a cyber police deputy director in northeastern China who is also a delegate to China's rubber-stamp legislature, the National People's Congress, first proposed the system during the Congress's annual meeting in March 2024. As soon as the government began soliciting public comments on the proposal last July, experts and legal scholars voiced opposition. Lao Dongyan, a prominent law professor at Tsinghua University, compared the system to 'installing a surveillance device on every individual's online activity' in a post on Weibo, an X-like Chinese social media platform. The post was removed soon after, and her account was subsequently suspended from posting for three months, for 'violating relevant rules.' In late May, when the finalized rules were unveiled after a year, almost no criticism could be found online. Xiao explained that it's not the first time authorities have spaced out the time between a proposal and its implementation, to allow critics to 'blow off steam.' 'It's done deliberately … Many of their measures follow the same pattern, and they've proven effective,' he said.

China tightens internet controls with new centralized form of virtual ID
China tightens internet controls with new centralized form of virtual ID

CNN

time20-06-2025

  • Politics
  • CNN

China tightens internet controls with new centralized form of virtual ID

China has mastered the craft of policing the internet, operating one of the world's most extensive online censorship and surveillance regimes. With mandatory identity checks on every online platform, it has become almost impossible for users to stay anonymous. But this rigidly moderated online environment is about to face even stricter controls with the introduction of a state-issued national internet ID. Instead of requiring individuals to submit their personal information for identity checks separately on each platform, the government now seeks to centralize the process by issuing a virtual ID that will allow users to sign in across different social media apps and websites. The rules for the new system, currently voluntary, were released in late May and will be implemented in mid-July. It aims to 'protect citizens' identity information, and support the healthy and orderly development of the digital economy,' according to the published rules. Experts, however, have raised concerns that the new policy will further erode already limited freedom of expression by forcing internet users to relinquish even more control to the state. Since Chinese leader Xi Jinping took power in 2012, the country has further tightened its grip on the digital space through an army of censors. Deployed around the clock, they remove posts, suspend accounts and help authorities identify critics, quashing any sign of dissent before it can gain traction. The finalized rules were announced after a proposal that was opened for public comment last summer, a typical step in China's legislative process. During the course of the public consultation over the past year, the proposal faced backlash from law professors, human rights experts and some internet users. Yet, the finalized rules remained largely similar to the draft. 'This is a state-led, unified identity system capable of real-time monitoring and blocking of users,' said Xiao Qiang, a research scientist studying internet freedom at the University of California, Berkeley. 'It can directly erase voices it doesn't like from the internet, so it's more than just a surveillance tool – it is an infrastructure of digital totalitarianism.' Control of China's vast portion of the global internet has largely been delegated to a decentralized range of different groups, with authorities relying partially on the social media platforms themselves to identify comments deemed problematic. Xiao warned that a centralized system using the internet ID could make it much easier for the government to wipe out a user's presence across multiple platforms at once. Shane Yi, a researcher at China Human Rights Defenders, an advocacy group, echoed Xiao's worries. The system gives the Chinese government expanded power to 'do what they want when they see fit' on the internet, as authorities are able to track users' entire digital trail 'from point zero,' she said. At home, Chinese state-run media has called the internet ID a 'bullet-proof vest for personal information' and touted the system as being able to greatly reduce the risk of personal data leaks. Already, more than six million people have registered for the ID, according to Chinese state-run media Xinhua last month, out of a total estimated online population of more than one billion. A cybersecurity official from the Ministry of Public Security told Xinhua that the internet ID service was strictly 'voluntary,' but the government encourages various industries and sectors to integrate with it. 'Its goal is to provide individuals with a secure, convenient, authoritative and efficient means of identity verification, in support of the development of the digital economy,' the person was quoted as saying. But experts have also questioned how voluntary the system truly is and highlighted risks of potential data breaches, as personal information is now being collected in a centralized manner. Haochen Sun, a law professor at the University of Hong Kong, said that, although the law presents the system as voluntary, it could gradually evolve into a system which users may struggle not to opt in to. 'If the government wants to promote this internet ID verification system, it can do so through various arrangements – essentially by encouraging people to adopt it, offering more conveniences in return,' he said. Sun also raised concerns about the increased risks of data leaks. 'A centralized, nationwide platform inherently creates a single point of vulnerability, making it an attractive target for hackers or hostile foreign actors,' he said. Government data breaches have occurred around the world. One notable incident in China involved a police database containing the personal information of one billion citizens being leaked online in 2022. Although the new rules won't take effect until mid-July, hundreds of apps started trialing the internet ID since last year. The system was born out of a proposal by a police official early last year. Jia Xiaoliang, a cyber police deputy director in northeastern China who is also a delegate to China's rubber-stamp legislature, the National People's Congress, first proposed the system during the Congress's annual meeting in March 2024. As soon as the government began soliciting public comments on the proposal last July, experts and legal scholars voiced opposition. Lao Dongyan, a prominent law professor at Tsinghua University, compared the system to 'installing a surveillance device on every individual's online activity' in a post on Weibo, an X-like Chinese social media platform. The post was removed soon after, and her account was subsequently suspended from posting for three months, for 'violating relevant rules.' In late May, when the finalized rules were unveiled after a year, almost no criticism could be found online. Xiao explained that it's not the first time authorities have spaced out the time between a proposal and its implementation, to allow critics to 'blow off steam.' 'It's done deliberately … Many of their measures follow the same pattern, and they've proven effective,' he said.

China tightens internet controls with new centralized form of virtual ID
China tightens internet controls with new centralized form of virtual ID

CNN

time20-06-2025

  • Politics
  • CNN

China tightens internet controls with new centralized form of virtual ID

China has mastered the craft of policing the internet, operating one of the world's most extensive online censorship and surveillance regimes. With mandatory identity checks on every online platform, it has become almost impossible for users to stay anonymous. But this rigidly moderated online environment is about to face even stricter controls with the introduction of a state-issued national internet ID. Instead of requiring individuals to submit their personal information for identity checks separately on each platform, the government now seeks to centralize the process by issuing a virtual ID that will allow users to sign in across different social media apps and websites. The rules for the new system, currently voluntary, were released in late May and will be implemented in mid-July. It aims to 'protect citizens' identity information, and support the healthy and orderly development of the digital economy,' according to the published rules. Experts, however, have raised concerns that the new policy will further erode already limited freedom of expression by forcing internet users to relinquish even more control to the state. Since Chinese leader Xi Jinping took power in 2012, the country has further tightened its grip on the digital space through an army of censors. Deployed around the clock, they remove posts, suspend accounts and help authorities identify critics, quashing any sign of dissent before it can gain traction. The finalized rules were announced after a proposal that was opened for public comment last summer, a typical step in China's legislative process. During the course of the public consultation over the past year, the proposal faced backlash from law professors, human rights experts and some internet users. Yet, the finalized rules remained largely similar to the draft. 'This is a state-led, unified identity system capable of real-time monitoring and blocking of users,' said Xiao Qiang, a research scientist studying internet freedom at the University of California, Berkeley. 'It can directly erase voices it doesn't like from the internet, so it's more than just a surveillance tool – it is an infrastructure of digital totalitarianism.' Control of China's vast portion of the global internet has largely been delegated to a decentralized range of different groups, with authorities relying partially on the social media platforms themselves to identify comments deemed problematic. Xiao warned that a centralized system using the internet ID could make it much easier for the government to wipe out a user's presence across multiple platforms at once. Shane Yi, a researcher at China Human Rights Defenders, an advocacy group, echoed Xiao's worries. The system gives the Chinese government expanded power to 'do what they want when they see fit' on the internet, as authorities are able to track users' entire digital trail 'from point zero,' she said. At home, Chinese state-run media has called the internet ID a 'bullet-proof vest for personal information' and touted the system as being able to greatly reduce the risk of personal data leaks. Already, more than six million people have registered for the ID, according to Chinese state-run media Xinhua last month, out of a total estimated online population of more than one billion. A cybersecurity official from the Ministry of Public Security told Xinhua that the internet ID service was strictly 'voluntary,' but the government encourages various industries and sectors to integrate with it. 'Its goal is to provide individuals with a secure, convenient, authoritative and efficient means of identity verification, in support of the development of the digital economy,' the person was quoted as saying. But experts have also questioned how voluntary the system truly is and highlighted risks of potential data breaches, as personal information is now being collected in a centralized manner. Haochen Sun, a law professor at the University of Hong Kong, said that, although the law presents the system as voluntary, it could gradually evolve into a system which users may struggle not to opt in to. 'If the government wants to promote this internet ID verification system, it can do so through various arrangements – essentially by encouraging people to adopt it, offering more conveniences in return,' he said. Sun also raised concerns about the increased risks of data leaks. 'A centralized, nationwide platform inherently creates a single point of vulnerability, making it an attractive target for hackers or hostile foreign actors,' he said. Government data breaches have occurred around the world. One notable incident in China involved a police database containing the personal information of one billion citizens being leaked online in 2022. Although the new rules won't take effect until mid-July, hundreds of apps started trialing the internet ID since last year. The system was born out of a proposal by a police official early last year. Jia Xiaoliang, a cyber police deputy director in northeastern China who is also a delegate to China's rubber-stamp legislature, the National People's Congress, first proposed the system during the Congress's annual meeting in March 2024. As soon as the government began soliciting public comments on the proposal last July, experts and legal scholars voiced opposition. Lao Dongyan, a prominent law professor at Tsinghua University, compared the system to 'installing a surveillance device on every individual's online activity' in a post on Weibo, an X-like Chinese social media platform. The post was removed soon after, and her account was subsequently suspended from posting for three months, for 'violating relevant rules.' In late May, when the finalized rules were unveiled after a year, almost no criticism could be found online. Xiao explained that it's not the first time authorities have spaced out the time between a proposal and its implementation, to allow critics to 'blow off steam.' 'It's done deliberately … Many of their measures follow the same pattern, and they've proven effective,' he said.

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