Protecting China’s New Economy

IF EVER THERE was an example of the West fighting the last war, it is over whether China is a ‘market economy’ in the eyes of the European Union. European steelmakers have been on the streets of Europe to support the case that it isn’t. China, however, has moved on to protecting its new economy.

The Ministry of Industry and Information Technology in concert with the State Administration of Press, Publication, Radio, Film and Television (SARFT) has published new rules for internet content providers. These set strict new guidelines for what can be published online, and what content—and which publishers—require prior approval from authorities.

“Sino-foreign joint ventures, Sino-foreign cooperative ventures, and foreign business units shall not engage in online publishing services,” the rules say, adding that any ‘online publication service units’ need to get prior approval from SARFT if they want to cooperate on a project with any foreign company, joint venture, or individual.

All content providers will also be required to host their data on local servers and be forbidden to store it on related servers and storage devices outside China.

The initial reaction outside China has been to see this as part of the strengthening central control over the media, and the creative industries generally, in line with President Xi Jinping’s broader centralization of authority and notions of soft power. Xi has just completed an inspection tour of leading state media to reinforce the message that they are there to be an instrument of the Party.

That, in itself, is nothing new, even if the emphasis on Chinese media gaining a louder voice on the international stage and “telling China’s story well” is.  However, the bluntness with which Xi underscored that state news media must “work to protect the Party’s authority and unity” and be the government and Party’s “publicity front” has not been heard for some time. Xi’s use of the word ‘struggle’ in the press’s role particularly harkens back to earlier times.

Western news providers such as Thomson Reuters, Dow Jones, Bloomberg, the Financial Times, and the New York Times are likely targets of the new rules. But so, too, are some of the fast growing non-state media companies that have flourished online through providing entertainment. The Party now wants to bring such outlets more under its sway in the way that traditional non-party media are circumscribed.

In the same vein, further targets include foreign game companies like Sony and Microsoft, and Hollywood studios and distributors that might introduce subversive—or even just foreign—ideas into the country through films, TV shows and other works of popular art.

However, the widely overlooked significance of the new rules is that they do not just tightly constrain China as a market for foreign news outlets, publishers and entertainment companies. They apply to all providers of online content.

That could include payments and e-commerce companies. Any foreign firm, such as Apple, Amazon or Alphabet (née Google), that might challenge China’s entrenched e-commerce giants is at risk.

That fits well with the notions of online national sovereignty that Xi outlined last December during a defense of online censorship in a speech to the Global Internet Conference, a meeting of a couple of dozen countries convened by China in Wuzhen in Zhejiang province.

As ever, how Chinese authorities implement the new rules — and how selectively — will determine how restrictive they are — and who gets restricted. Chinese laws are usually vague and broad to that end, if always with laser-focused purpose.

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Filed under Arts & Culture, Economy, Media

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