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China’s Reaction to Trump’s Election Win

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Xinhua Commentary Series: Spotlight on the U.S. Presidential Election

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Wu Guoguang: Xi Jinping’s Reversal of the Course, Will China’s Transition be Peaceful or Marked with Bloodshed?

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Cheng Xiaonong: U.S.-China Strategic Relations Have Crystallized

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Netizen Exposes Data Collection Function of Smart TVs Made in China

Recently, a Chinese netizen discovered that his home TV, equipped with the Android system, was secretly carrying out surveillance capabilities. In an article posted on the V2EX website, a discussion platform for designers and developers, he mentioned that a data service on his TV scans all network devices every 10 minutes, even including his neighbors’ information.

As he felt the transmission of the TV signal was slow, he decided to look at the background services that were running. He found something called ‘Gozen Data Service,’ about which he had absolutely no idea.

“I found that this thing scans my household’s network devices every 10 minutes, sending back the information including hostname, MAC (Media Access Control), IP addresses, and even the network latency time. It also detects the surrounding WiFi SSID (Service Set Identifier) names, and MAC addresses packaged and sent to the domain name gz-data .com.”

“In other words, with the information such as whatever smart devices or cell phones are physically at home, anyone who is connected to the WiFi, and the name of the neighbors’ WiFi networks, were collected and uploaded all the time. Are we sure this is not a spy service?”

Gozen Data is a Chinese company specializing in big data service in large smart TV’s, reaching over 100 million smart TV terminals made in China and accounting for 55 percent of the market. As of April 2019, Gozen Data entered into a long-term partnership with a long list of Chinese and Western companies including Sanyo, Toshiba, and Philips, by the implanting of an SDK (Software development kit) in the TV’s operating system so as to collect smart TV data.

Xing Jian, a citizen journalist who is familiar with the Internet technology, told Radio Free Asia that the Chinese government had modified the open-source Android system and used it for the “Xueliang Project (雪亮工程),” an IT network to surveil people living in the rural area.

The “Android system repurposed for this ‘Xueliang Project’ was able to achieve the networking of public security surveillance videos. The application usually intrudes into cell phones, TVs and other Android devices in the form of ‘spyware,’ automatically scanning and collecting the information such as device model, usage, and social media and transferring the data to the government databases.”

Source: Radio Free Asia, April 27, 2021
http://https://www.rfa.org/mandarin/yataibaodao/meiti/ql1-04272021042034.html

Briefings | | |   Information/Technology

China Adopts Anti-espionage Regulation Targeting “Hostile Forces”

On April 26, 2021, China’s Ministry of State Security released a new anti-espionage regulation, which was to be effective immediately. The regulation allows the national security authority to draw up lists of companies and organizations susceptible to foreign infiltration, treating a broad range of entities, including potentially universities and private businesses, as if they are sensitive government agencies.

The regulation specifies that agencies, social groups, enterprises, public institutions, and other social organizations are primarily responsible for the unit’s anti-espionage security work.

On April 26, 2021, officials from the Ministry of State Security explained to the press, “Overseas espionage and intelligence agencies and hostile forces have intensified their infiltration into China, with more diverse methods and in broader fields, which pose a serious threat to China’s national security and interests.”

At the same time, “the core and vital areas still have issues such as which organizations bear the primary responsibilities for anti-espionage security and prevention measures that are not institutionalized.”  Officials from the Ministry of State security said that the regulation clarifies “what, who and how” to guard against foreign espionage.

According to the regulation, the Ministry of State Security will provide companies and organizations susceptible to foreign infiltration with work manuals, guides, and other publicity and education materials. The authorities will also issue written guidance, organize trainings, hold work meetings, and supervise anti-espionage work using different methods such as reminders and advice.

Under the regulation, the companies, organizations, or social groups have the responsibility of rolling out detailed measures against foreign espionage. The measures identified in the regulation include arranging their working staff to sign letters of commitment before taking up posts, reporting their activities related to national security, briefing personnel ahead of their trips overseas, and interviewing them after their return to China.

Sources:
1. People’s Daily, April 26, 2021
http://legal.people.com.cn/n1/2021/0426/c205462-32088423.html

2. Xinhua, April 26, 2021
http://www.xinhuanet.com/2021-04/26/c_1127376250.htm

Briefings | | |   Defense/Military Government/Politics

TikTok Accused in London of Collecting Children’s Private Information Illegally

Well-known Chinese news site NetEase (NASDAQ: NTES) recently reported that a class action lawsuit was filed in London against TikTok because it was illegally collecting private information from millions of children. TikTok may face a damages of billions of U.S dollars. According to Anne Longfield, leader of this current suit and the former Children’s Commissioner for England, every child can receive thousands of dollars in compensation if they win the case. According to Longfield, since May 25, 2018, every child who used TikTok suffered TikTok’s illegal information collection. The information was provided to unknown third parties for consumption regardless of what privacy settings the children had on the app. The information includes phone numbers, physical location and videos. TikTok claimed these accusations are baseless. In 2019, TikTok was fined by the U.S. FTC for a total of US$5.7 million for illegal information collection from underaged users. The company is still seeking settlement of a privacy related suit in the United States. The class lawsuite indicated that TikTok collected information without transparency and without the guardian’s consent, violating British and European Union data protection laws. There are 3.5 million children impacted in Britain alone.

Source: NetEase, April 21, 2021
https://www.163.com/tech/article/G84A0OMB00097U7R.html

Briefings | | |   Geo-Strategic Trend Information/Technology

Global Times: Russia Plans to Quit the International Space Station

Global Times recently reported that multiple high ranking Russian government officials said Russia will leave the alliances that constructed the International Space Station and start to build its own space station. This may put an end to the 20-year international relationship, which was recognized as a “rare example” of cooperation between Russia and the West. Dmitry Rogozin, Director General of Roscosmos, said Russia is gradually leaving the International Space Station and is ready to build Russia’s own, pending President Putin’s approval. The new Russian Station is expected to be launched in 2030. The International Space Station was founded in 1998. It centered on the United States and Russia, with the help from Japan, Canada, the European Space Agency member countries and Brazil. The 16-country international project received a total investment of over US$100 billion. Russia provided significant support to the International Space Station over the years. Currently the Station is rapidly aging. The United States did not show any interest in working with Russia in the future and both sides expressed the intent to have their own stations.

Source: Global Times, April 25, 2021
https://world.huanqiu.com/article/42rkMQxDBTQ

Briefings | | |   Geo-Strategic Trend Information/Technology

TSMC Chairman: China’s Semiconductor Industry Is Still Far Behind

Major Taiwanese news network China Times recently reported that Morris Chang, Chairman of TSMC (Taiwan Semiconductor Manufacturing Company), gave a speech at a think tank conference. He expressed the view that China’s semiconductor industry is still far behind Taiwan while South Korea’s Samsung is a strong competitor. TSMC is currently the world’s most valuable semiconductor manufacturer. Chang thinks Mainland China is still over five years behind, even with tens of billions of dollars in government subsidies. Chang said that Taiwan has three competitive advantages. One is a large talent pool in the semiconductor area. Even the United State cannot compare. The second is that all levels of managers are from Taiwan. The third advantage is Taiwan’s advanced high-speed railway system and freeway system, which are suitable for large-scale manufacturing personnel movements. TSMC has three major manufacturing centers across Taiwan and thousands of engineers can be mobilized without moving their homes. TSMC has started investments in the United States. However, Chang has some reservation about the popularity of the manufacturing industry in the U.S. as well as the loyalty of U.S. engineers.

Source: China Times, April 22, 2021
https://www.chinatimes.com/cn/newspapers/20210422000563-260102?chdtv

Briefings | | |   Geo-Strategic Trend Information/Technology

Accused of Leaking Xi Jinping’s Daughter’s Info, 22-Year-Old Computer Genius Sentenced to 14 Years in Prison

On April 23, the Chinese high court affirmed the verdict of the lower court and sentence 22-year-old Niu Tengyu to a 14-year prison term. The verdict was issued in the absence of the defendant, the lawyers and the defendant’s family members. Niu and 23 other young people were accused of leaking the personal information of the daughter of Xi Jinping on the Internet.

In May 2019, the personal information of Xi Jinping’s daughter Xi Mingze and Xi Jinping’s brother-in-law Deng Jiagui appeared on two overseas websites called, “The Hong An Foundation” and “Shina.” China’s Ministry of Public Security formed a task force. Cyber police from Maoming city in Guangdong province arrested the members of “Esu wiki,” a website on the mainland. It was said to have connections with the two overseas websites because they were unable to catch the leakers overseas.

On December 30, 2020, the Maonan District Court in Maoming City, Guangdong Province issued a verdict that all 24 people who were arrested were found guilty. Niu, the primary suspect, was sentenced to 14 years in prison, and the rest of the people were sentenced to 1 to 4 years in prison. Niu was only 20 year old, and he is considered a computer genius.

Hong Kong Apple Daily reported that the Niu’s family accused the Maoming police of torturing and forcing Niu to “confess” that he was the primary lead in the case because they were unable to arrest the owners of the foreign websites. Niu’s mom has met with foreign diplomats from countries such as the U.S., the U.K and France to appeal her son’s arrest. She told Voice of America that she wishes that the diplomats would convey the truth to their country’s leaders because the arrested kids are being used as scapegoats and were wrongfully charged. She said that the authorities knew that the owners of the foreign websites admitted that they leaked the information and it has nothing to do with the members of Esu wiki. However, the authorities still told the parents to cooperate with the investigation and even closed the online chat groups that the parents had set up. They told the parents not to speak with any foreign media and threatened the defense lawyers, telling them that they cannot file a not guilty plea for the kids. Niu’s current lawyer is the fifth one. The police from Tianjingy took them away on April 23. Niu’s mom said Xi Jinping promoted the rule by law but the local officials have been covering up their mistakes and they have been “juggling” with the law. She assured those that she communicated with that the case is a wrongful conviction and she is going to fight for her rights all the way to the end.

Source: Central News Agency, April 23, 2021
https://www.cna.com.tw/news/firstnews/202104230291.aspx

Briefings | | |   Government/Politics

Apple Daily: Chinese Entrepreneur Sun Dawu Was Officially Arrested

Last November, Hebei police took away Sun Dawu, the founder of the Dawu Agricultural and Animal Husbandry Group in Hebei Province who is known as an “outspoken entrepreneur. They also took “his wife Liu Huiru and a few others for investigation and accused them of “slandering and disturbing the social order. At the same time, officials from Hubei province dispatched 29 teams to the Dawu Group and took over the management of the company. The Dawu Group Legal Director Yang Bin revealed on Weibo on April 22 that the authorities have issued an official arrest notice to Sun Dawu, who by that time, had been in custody for more than five months. Six other senior officials of the company also received arrest notices. Sun was charged with crimes including illegally misleading the public to collect deposits, slandering and disturbing the social order, illegal mining, illegal occupation of farmland and more. Sun is currently being detained at the Hebei Gaobeidian Detention Center. Yang wrote that a number of signs indicate that the investigative agency is speeding up the pace of the case.

Netizens posted comments calling the charges ridiculous and said that the officials can always come up with charges if they want to. [Editor’s note: The Chinese idiom 欲加之罪何患無辭 is applicable. It means, “He who has a mind to beat his dog will easily find a stick.”]

Sun is another outspoken person who was imprisoned for speaking up against the current regime. For more information, please see the previous published briefing on Sun’s arrest: Four Reasons Why the CCP Arrested Farmer Businessman Sun Dawu, http://chinascope.org/?s=sun+dawu

Source: Apple Daily, April 23, 2021
https://tw.appledaily.com/international/20210423/7S7BDLX6Z5HLZIUYDLZHGTRC5Y/

Briefings | | |   Government/Politics

China’s Q1 Foreign Direct Investment Showed a 4.6 Percent Annual Increase

On March 25, China’s Ministry of Commerce announced that foreign direct investment data for the first quarter of 2021 was 206.14 billion yuan (US$31.79 billion), a year over year increase of 4.6 percent. The data showed that foreign non-financial direct investment was 160.81 billion yuan (US$24.76 billion), a year-over-year decrease of 4.9 percent. The amount for the completion of contracted projects was 195.31 billion yuan (US$30.07 billion), roughly the same as the same period last year. The newly signed contract value was 347.24 billion yuan (US$534.62 billion), a year-over-year decrease of 10.2 percent. In addition, 74,000 individuals from different labor forces were dispatched overseas. At the end of March 590,000 personnel were working abroad.

Below are four major highlights:

1) “Belt and Road” countries showed a steady growth in investments. In the first quarter, China’s non-financial direct investment in these countries was US$4.42 billion, an increase of 5.2 percent year over year. The value of newly signed contracted projects was US$31.34 billion, and the completed contract value was US$17.75 billion, an increase of 19.4 percent and 12.4 percent year-over-year respectively.

2) The investments in manufacturing, information transmission and other fields showed a rapid growth. In the first quarter, investment in manufacturing was US$3.84 billion, a year over year increase of 17.8 percent; the investment in the information transmission industry was US$1.62 billion, a year over year increase of 20.9 percent.

3) Foreign investments from local enterprises have increased. In the first quarter, foreign non-financial direct investment by local enterprises was US$20.03 billion, a year over year increase of 9.9 percent, accounting for 80.8 percent of the total foreign direct investment in the same period. The year over year growth of foreign investment from the eastern, central and western regions reached 7.2 percent, 45.6 percent and 6.3 percent respectively.

4) Foreign contracted projects are mostly in infrastructure. In the first quarter, the value of newly signed contracts for overseas infrastructure projects was US$41.2 billion, and for the completed contracts, it was US$24.6 billion, accounting for 77 percent and 81.6 percent of the total respectively.

Source: Sina, April 25, 2021
https://sina.com.hk/news/article/20210425/2/81/2/%E5%95%86%E5%8B%99%E9%83%A8-%E4%B8%80%E5%AD%A3%E5%BA%A6%E4%B8%AD%E5%9C%8B%E5%B0%8D%E5%A4%96%E7%9B%B4%E6%8E%A5%E6%8A%95%E8%B3%872061-4%E5%84%84%E5%85%83-12988123.html

Briefings | | |   Economy/Resources