China

A Transformative Approach to Technology Financing or a Danger to Freedoms?

As part of China’s massive Belt and Road Initiative (BRI), the biggest infrastructure undertaking in the world, Beijing has launched the Digital Silk Road (DSR). Announced in 2015 with a loose mandate, the DSR has become a significant part of Beijing’s overall BRI strategy, under which China provides aid, political support, and other assistance to recipient states. DSR also provides support to Chinese exporters, including many well-known Chinese technology companies, such as Huawei. The DSR assistance goes toward improving recipients’ telecommunications networks, artificial intelligence capabilities, cloud computing, e-commerce and mobile payment systems, surveillance technology, smart cities, and other high-tech areas. China has already signed agreements on DSR cooperation with, or provided DSR-related investment to, at least sixteen countries. But the true number of agreements and investments is likely much larger, because many of these go unreported: memoranda of understanding (MOUs) do not necessarily show whether China and another country have embarked upon close cooperation in the digital sphere. Some estimates suggest that one-third of the countries participating in BRI—138 at this point—are cooperating on DSR projects. Chinese firms are bringing technology and additional benefits to developing countries by establishing training centers and research and development programs to boost cooperation between scientists and engineers in these countries and their Chinese counterparts, and to transfer technical knowledge in areas such as smart cities, artificial intelligence and robotics, and clean energy, among others. Still, some democracies have raised serious concerns about the Digital Silk Road. They worry that China will use DSR to enable recipient countries to adopt its model of technology-enabled authoritarianism, which would be detrimental to personal freedoms and sovereignty in those countries. Moreover, allowing Chinese firms to build countries’ fifth-generation (5G) networks and other infrastructure, and to set technology standards that could become the norm in many countries, could risk espionage and coercion of other states’ politics if Beijing used data breaches to blackmail political elites in those states. To learn more about the Digital Silk Road and its implications, see my new CFR Interactive.

While Huawei clearly benefits from the China-Russia science and technology partnership, it also helps facilitate it.

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The recently announced EU proposal is a welcome development that recognizes the economic dimensions of great power competition.

The Financial Times recently reported that the European Union is preparing a proposal for the incoming Biden Administration that envisions a comprehensive strengthening of transatlantic cooperation aimed in part at countering China’s global influence. Clearheaded thinking about how to coordinate efforts and pool resources to present more meaningful development opportunities to African partners should find space on that agenda.  While countering China should not be the central organizing principle for U.S.-Africa relations, there is no doubt that U.S. influence—and therefore U.S. capacity to achieve various foreign policy goals—suffers when China’s investments in the tangible, visible infrastructure of African prosperity appear to dwarf U.S. development efforts. Addressing this reality amid the economic constraints of the COVID-19 era will require far more cooperation with like-minded partners that share an interest in an economically vibrant, free, peaceful, and internationally engaged African continent.  Earlier this year, the EU proposed a new Africa strategy [PDF] with five primary areas of focus: a “green transition” and energy access; digital transformation; sustainable growth and jobs; peace, security and governance; and migration and mobility. That broad framework includes ample areas of overlap with Washington’s own priorities; the task for policymakers will be to focus financing efforts on specific projects and opportunities that can create jobs and improve sustainability, especially in Africa’s rapidly growing cities.  This requires moving well past donor coordination mechanisms, which too often devolve into box-checking exercises that allow diffuse or redundant efforts to continue while aligned only in spirit and intention. It also requires all the cumbersome realities of real cooperation, which introduces constraints and compromises that might not otherwise exist. But if the United States and Europe are serious about building their influence and relevance in a region of increasing global importance, those headaches are a small price to pay. 

An update of the Council on Foreign Relations' Cyber Operations Tracker for the period between July and September 2020.

Over the weekend, 15 Asian states, including China, signed the Regional Comprehensive Economic Partnership. The deal provides a major signal to investors that the region is still committed to multilateral trade integration.