foreignpolicy--2020-05-13--Why China Is Punishing Australia

Why China Is Punishing Australia

Welcome to Foreign Policy ’ s weekly China Brief .
The highlights this week : China suspends imports from major Australian meat suppliers , another city in China ’ s northeast reimposes travel restrictions , and Shanghai ’ s Disneyland reopens .
If you would like to receive China Brief in your inbox every Wednesday , please sign up here .
China has suspended imports from four major Australian meat firms , escalating a quarrel between the two countries over the origins of the novel coronavirus .
Speaking at a press conference , Chinese Ministry of Foreign Affairs spokesperson Zhao @ @ @ @ @ @ @ to the dispute but was instead a matter of regulation—and then went on to issue further economic threats against Australia .
The warnings are backed up by increasingly belligerent editorials in state media .
The dispute began with the Australian government ’ s call for an independent investigation into the origins of the coronavirus .
China has reacted strongly against allowing a transparent , multilateral probe in Wuhan and acted to impede Chinese investigators .
That could be a sign that there ’ s something to hide—whether sloppy regulation of the wildlife trade @ @ @ @ @ @ @ Beijing ’ s reaction may also be a byproduct of a paranoid system .
Trade punishments .
China has a track record of using trade measures to punish countries that challenge its ideological demands , such as its suspension of salmon imports from Norway after the Nobel Peace Prize—administered by a committee appointed by the Norwegian parliament—was awarded in 2010 to the Chinese dissident Liu Xiaobo .
The next step may be to foment boycotts against Australian firms , as was done to South Korean companies over the deployment of a U.S. missile @ @ @ @ @ @ @ The threats have emboldened Australian politicians and pundits who see the country ’ s economic relationship with China—one of the main markets for Australian minerals and meat—as a potential threat .
Australia once saw the so-called Asian century as an opportunity but is increasingly uncomfortable with China ’ s regression into autocracy and geopolitical belligerence .
The country has a long—and often racist—history of unease with its physical proximity to Asia , but today it shares close ties with many Southeast Asian and Pacific nations that feel threatened by an emboldened China .
@ @ @ @ @ @ @ has obtained a leaked database on the spread of the coronavirus in China .
Isaac Stone Fish and Maria Krol Sinclair detail the extent of the leak , which has not yet been fully analyzed .
The information could prove helpful for researchers trying to determine the veracity of China ’ s much-disputed coronavirus statistics .
Chinese authorities have been reluctant to share detailed data with the rest of the world , although foreign and Chinese scientists have successfully cooperated on a number of important research papers .
Chinese government data leaks are @ @ @ @ @ @ @ party-state and the harsh measures taken against supposed spies .
A series of leaks about the mass detention of Uighur Muslims in Xinjiang last year suggested internal dissatisfaction with the genocidal campaign there .
A hot zone in the northeast .
Jilin , a city in China ’ s northeast , is the latest to reimpose travel restrictions after a small number of coronavirus reinfections from travelers returning from abroad .
China ’ s northeast region , which borders Russia , is of particular concern for officials who fear that their success in @ @ @ @ @ @ @ their neighbor ’ s failures .
Meanwhile , just six new cases in Wuhan prompted the firing of a local official and an ambiguous government pledge to test all city residents in just 10 days .
Expert review concluded this was impossible : The level of testing in China remains unknown , though it appears to be more extensive than in the United States .
Threats against Taiwan .
Taiwan has been taking advantage of its success against the coronavirus to highlight its exclusion from the World Health Organization and push for a @ @ @ @ @ @ @ Perhaps unsurprisingly , China has responded with both rhetorical threats and military provocations , according to a U.S. congressional report .
But such saber-rattling is unlikely to lead to invasion given the scale of the pandemic challenges Beijing faces at home , as Drew Thompson argued in FP this week .
In Hong Kong , however , the government is doubling down on repression—with a new law that criminalizes booing China ’ s national anthem high on the agenda .
Trade war offer .
Beijing made a conciliatory move in the trade war @ @ @ @ @ @ @ offering new concessions , excluding certain U.S. imports from tariffs .
The status of the phase-one trade deal hammered out last fall now seems extremely uncertain .
Trump ’ s anti-Chinese rhetoric , mixed with praise for Chinese President Xi Jinping , rarely leads to direct action—but large parts of the deal are now effectively impossible thanks to declining trade numbers .
China ’ s Disneyland reopens .
Shanghai Disneyland is the first Disney location to reopen since the coronavirus was declared a pandemic—but it ’ s operating at just 20 percent capacity @ @ @ @ @ @ @ .
Disney hopes to scale up operations at the park , which is unlikely to be running at a profit with decreased attendance—but it sees the Shanghai opening as a testing ground for the future .
Other firms may soon do the same with their East Asian locations , thanks to the largely successful containment of the coronavirus in the region .
Shifting supply chains .
Japan , like the United States , is rethinking its China-dependent supply chains as a result of the pandemic and increasing political risk .
Prime Minister Shinzo @ @ @ @ @ @ @ to Japanese firms to move out of China—but Toyota and other firms are refusing to leave for the moment , seeing the advantages of mainland manufacturing as outweighing the risks .
This prescient book , published in 2018 , examines the degree to which China has come to dominate pharmaceutical supply chains and calls out the political and medical risks involved .
Gibson , a veteran medical writer , and Singh , a World Bank expert , rightly point out the greed and regulatory failings on the U.S. side that allowed this dependency @ @ @ @ @ @ @ threats to cut off pharmaceutical supplies to the United States if relations worsen , reshuffling supply chains is strongly on the mind of policymakers .
That ’ s it for this week .
We welcome your feedback at newsletters @ foreignpolicy.com .
You can find older editions of China Brief here .
For more from Foreign Policy , subscribe here or sign up for our other newsletters .

Welcome to Foreign Policy’s weekly China Brief. The highlights this week: China suspends imports from major Australian meat suppliers, another city in China’s northeast reimposes travel restrictions , and Shanghai’s Disneyland reopens .
Welcome to Foreign Policy’s weekly China Brief. The highlights this week: China suspends imports from major Australian meat suppliers, another city in China’s northeast reimposes travel restrictions, and Shanghai’s Disneyland reopens.
If you would like to receive China Brief in your inbox every Wednesday, please sign up here.
China Suspends Australian Meat Imports
China has suspended imports from four major Australian meat firms, escalating a quarrel between the two countries over the origins of the novel coronavirus. Speaking at a press conference, Chinese Ministry of Foreign Affairs spokesperson Zhao Lijian said the suspension was not connected to the dispute but was instead a matter of regulation—and then went on to issue further economic threats against Australia. The warnings are backed up by increasingly belligerent editorials in state media.
The dispute began with the Australian government’s call for an independent investigation into the origins of the coronavirus. China has reacted strongly against allowing a transparent, multilateral probe in Wuhan and acted to impede Chinese investigators. That could be a sign that there’s something to hide—whether sloppy regulation of the wildlife trade or even a biosafety accident. But Beijing’s reaction may also be a byproduct of a paranoid system.
Trade punishments. China has a track record of using trade measures to punish countries that challenge its ideological demands, such as its suspension of salmon imports from Norway after the Nobel Peace Prize—administered by a committee appointed by the Norwegian parliament—was awarded in 2010 to the Chinese dissident Liu Xiaobo. The next step may be to foment boycotts against Australian firms, as was done to South Korean companies over the deployment of a U.S. missile defense system.
The Asian century? The threats have emboldened Australian politicians and pundits who see the country’s economic relationship with China—one of the main markets for Australian minerals and meat—as a potential threat. Australia once saw the so-called Asian century as an opportunity but is increasingly uncomfortable with China’s regression into autocracy and geopolitical belligerence. The country has a long—and often racist—history of unease with its physical proximity to Asia, but today it shares close ties with many Southeast Asian and Pacific nations that feel threatened by an emboldened China.
What We’re Following
Virus outbreak database leaked. Foreign Policy has obtained a leaked database on the spread of the coronavirus in China. Isaac Stone Fish and Maria Krol Sinclair detail the extent of the leak, which has not yet been fully analyzed. The information could prove helpful for researchers trying to determine the veracity of China’s much-disputed coronavirus statistics. Chinese authorities have been reluctant to share detailed data with the rest of the world, although foreign and Chinese scientists have successfully cooperated on a number of important research papers.
Chinese government data leaks are rare due to the omertà of the party-state and the harsh measures taken against supposed spies. A series of leaks about the mass detention of Uighur Muslims in Xinjiang last year suggested internal dissatisfaction with the genocidal campaign there.
A hot zone in the northeast. Jilin, a city in China’s northeast, is the latest to reimpose travel restrictions after a small number of coronavirus reinfections from travelers returning from abroad. China’s northeast region, which borders Russia, is of particular concern for officials who fear that their success in containing the virus might be undermined by their neighbor’s failures. Meanwhile, just six new cases in Wuhan prompted the firing of a local official and an ambiguous government pledge to test all city residents in just 10 days. Expert review concluded this was impossible: The level of testing in China remains unknown, though it appears to be more extensive than in the United States.
Threats against Taiwan. Taiwan has been taking advantage of its success against the coronavirus to highlight its exclusion from the World Health Organization and push for a bigger place on the international stage. Perhaps unsurprisingly, China has responded with both rhetorical threats and military provocations, according to a U.S. congressional report. But such saber-rattling is unlikely to lead to invasion given the scale of the pandemic challenges Beijing faces at home, as Drew Thompson argued in FP this week. In Hong Kong, however, the government is doubling down on repression—with a new law that criminalizes booing China’s national anthem high on the agenda.
Tech and Business
Trade war offer. Beijing made a conciliatory move in the trade war with the United States this week, offering new concessions, excluding certain U.S. imports from tariffs. The status of the phase-one trade deal hammered out last fall now seems extremely uncertain. Trump’s anti-Chinese rhetoric, mixed with praise for Chinese President Xi Jinping, rarely leads to direct action—but large parts of the deal are now effectively impossible thanks to declining trade numbers.
China’s Disneyland reopens. Shanghai Disneyland is the first Disney location to reopen since the coronavirus was declared a pandemic—but it’s operating at just 20 percent capacity, with social distancing and masks mandatory. Disney hopes to scale up operations at the park, which is unlikely to be running at a profit with decreased attendance—but it sees the Shanghai opening as a testing ground for the future. Other firms may soon do the same with their East Asian locations, thanks to the largely successful containment of the coronavirus in the region.
Shifting supply chains. Japan, like the United States, is rethinking its China-dependent supply chains as a result of the pandemic and increasing political risk. Prime Minister Shinzo Abe’s government is offering incentives to Japanese firms to move out of China—but Toyota and other firms are refusing to leave for the moment, seeing the advantages of mainland manufacturing as outweighing the risks.
What We’re Reading China Rx: Exposing the Risks of America’s Dependence on China for Medicine, Rosemary Gibson and Janardan Prasad Singh, Prometheus, April 2018
This prescient book, published in 2018, examines the degree to which China has come to dominate pharmaceutical supply chains and calls out the political and medical risks involved. Gibson, a veteran medical writer, and Singh, a World Bank expert, rightly point out the greed and regulatory failings on the U.S. side that allowed this dependency to evolve. With China now issuing threats to cut off pharmaceutical supplies to the United States if relations worsen, reshuffling supply chains is strongly on the mind of policymakers.
That’s it for this week.
We welcome your feedback at newsletters@foreignpolicy.com. You can find older editions of China Brief here. For more from Foreign Policy, subscribe here or sign up for our other newsletters.


foreignpolicy--2020-05-13--The United States Can’t Afford to Turn Away Chinese Talent

The United States Can ’ t Afford to Turn Away Chinese Talent The pandemic threatens a reckoning in U.S.-China relations .
COVID-19 ’ s arrival has highlighted the range of risks that can arise from the connectivity between the two countries .
American policymakers are grappling with complex questions about how to recalibrate the character of U.S.-China economic interdependence and technological entanglement .
But some of the answers that have been proposed are far too simple and may backfire on U.S. competitiveness .
As the consensus among American policymakers shifts toward seeing China as a competitor , even an adversary @ @ @ @ @ @ @ scientists to the United States has come to seem risky or threatening to U.S. technological leadership .
For instance , U.S. President Donald Trump is reported to have claimed in reference to China that “ almost every student that comes over to this country is a spy.
” Sen. Tom Cotton also recently recommended excluding Chinese postgraduate students from critical technology disciplines : “ If Chinese students want to come here and study Shakespeare and the Federalist Papers , that ’ s what they need to learn from America .
They don ’ @ @ @ @ @ @ @ artificial intelligence from America.
” In a May 7 letter , he and three other Republican senators called for restrictions on immigration that would include the suspension of H-1B visas and the curbing of the Optional Practical Training program , which allows foreign students to work in the United States after graduating .
Intellectual property theft is a real concern , and China has been the world ’ s foremost infringer .
But a blanket exclusion of Chinese students from U.S. academic and scientific research is not a reasonable response—and risks harming America @ @ @ @ @ @ @ strength and vitality of its research enterprise and innovation ecosystem .
Implementing such a blunt cudgel would undermine the very engine of innovation that it seeks to protect , at a time when the United States is engaged in an ongoing and intensifying competition for global talent .
Certainly , both Republican and Democratic U.S. policymakers are right to be exploring options to take action against technology transfer .
China ’ s party-state has undertaken extensive campaigns of industrial espionage over decades to enable the transfer of critical technologies and the theft of @ @ @ @ @ @ @ Such efforts have corresponded with Beijing ’ s strategic priorities , including self-driving cars and semiconductors .
Among a range of tactics , academic exchanges and research partnerships can be leveraged to those ends .
Such efforts can bolster China ’ s military modernization or facilitate party-state coercive capabilities that enable human rights atrocities , thus threatening U.S. security and principles .
Universities have not been immune to these efforts .
There have been incidents in which Chinese researchers at American universities have exploited academic openness .
In several instances , members of @ @ @ @ @ @ @ or working with U.S. universities , including recently a Chinese lieutenant who had concealed her military affiliation to conduct research at Boston University .
Chinese military research institutions have also sent abroad and actively recruited students and scientists based on their experience at leading research institutions around the world .
Yet addressing this problem calls for a scalpel , not a sledgehammer .
Instead of blanket bans , the focus of U.S. concerns and policy responses should be on how to counter the tactics and mechanisms that China ’ s party-state exploits for @ @ @ @ @ @ @ risk can allow the U.S. academic research enterprise to continue to thrive and to remain open and attractive in the rivalry for global talent .
So far , the United States is winning that competition by a landslide .
Contrary to the perception that Chinese graduates of U.S. institutions usually leave , the proportion of Chinese Ph.D. students who remain in the United States after graduation remains high .
Data collected by the Center for Security and Emerging Technology estimate that 91 percent of Chinese Ph.D. students in artificial intelligence stay in the @ @ @ @ @ @ @ after graduating—despite the challenges that securing visas already involves .
The United States can reap benefits to its innovation ecosystem from welcoming these students .
As Silicon Valley firms that compete among themselves for the top engineers well know , the ability to attract , motivate , and retain top talent is the driving factor of success in innovation .
The same is true of nation-states in the 21st century .
U.S. research remains the world ’ s envy precisely because it can draw on the world ’ s talent .
The desire @ @ @ @ @ @ @ and ultimately immigrate to the United States is one of the largest components of its soft power , which can provide a key edge in today ’ s technological competition with China if it is sustained and carefully cultivated .
Cutting off the science and technology talent flow from China to the United States would hand China ’ s party-state the gift of a forfeit in this part of that contest .
While U.S. policymakers worry about the exfiltration of research from the United States , the Chinese government has been highly concerned @ @ @ @ @ @ @ , especially in artificial intelligence .
The very talent plans and initiatives , like China ’ s Thousand Talents Program , that have provoked much concern in U.S. policy debates have been attempts to reduce and reverse that loss—to promote “ brain gain ” instead .
While the Chinese government has tried to attract foreign talent , these efforts tend to have limited success , including because of the difficulties that international researchers experience in adjusting to life and the constraints of living in China .
Going forward , a stronger and more @ @ @ @ @ @ @ employ proactive , but carefully targeted policy action .
For one , there is a strong rationale to enhance scrutiny in visa screening , and more rigorous screening could ensure that researchers who have ties to foreign militaries , such as the People ’ s Liberation Army , or to foreign security services and intelligence organizations would be denied the opportunity to study in the United States in the first place .
Improving such screening in a fair and evidence-based manner would require increasing the resources of and ensuring that the appropriate authorities @ @ @ @ @ @ @ Department of Homeland Security , while promoting greater coordination among stakeholders , as well as improved leveraging of open-source information .
U.S. law enforcement and counterintelligence can also institutionalize collaborative engagement with American universities to promote best practices for risk mitigation on campuses , including creating clear points of contact for exchange and the reporting of concerns .
And universities should introduce more robust and consistent requirements for disclosure of foreign funding and promote greater transparency .
At the same time , for such efforts to be effective and consistent with civil rights @ @ @ @ @ @ @ the theft of research or intellectual property must also be careful to mitigate the risks of and introduce safeguards against bias or racial targeting .
American policymakers and university administrators must take care that the United States remains an attractive destination for foreign students and immigrant researchers .
To do so requires standing against and condemning incidents of hostility toward Chinese students .
Xenophobia runs counter to America ’ s core principles and damages the competitiveness of its global offering .
At the same time , thoughtful reforms , not simply restrictions , @ @ @ @ @ @ @ needed .
In particular , increasing the number of H-1B visas offered for employers and expediting the green card process for graduates in high-priority disciplines could enhance U.S. capacity to retain STEM Ph.D. graduates who may be forced to depart otherwise .
Similarly , the Optional Practical Training program should not be targeted but rather expanded and perhaps modified to create a more viable pathway to permanent residency and citizenship for those graduates from high-priority disciplines who participate .
Indeed , one study found that curbing the program could cause a decline in @ @ @ @ @ @ @ impact entrepreneurship .
Ultimately , the United States is stronger when it can not only welcome but also harness global talent , including from China .
Banning students and Chinese researchers from academic science would give the Chinese Communist Party a victory .

The pandemic threatens a reckoning in U.S.-China relations. COVID-19’s arrival has highlighted the range of risks that can arise from the connectivity between the two countries. American policymakers are grappling with complex questions about how to recalibrate the character of U.S.-China economic interdependence and technological entanglement. But some of the answers that have been proposed are far too simple and may backfire on U.S. competitiveness.
The pandemic threatens a reckoning in U.S.-China relations. COVID-19’s arrival has highlighted the range of risks that can arise from the connectivity between the two countries. American policymakers are grappling with complex questions about how to recalibrate the character of U.S.-China economic interdependence and technological entanglement. But some of the answers that have been proposed are far too simple and may backfire on U.S. competitiveness.
As the consensus among American policymakers shifts toward seeing China as a competitor, even an adversary, continuing to welcome Chinese students and scientists to the United States has come to seem risky or threatening to U.S. technological leadership. For instance, U.S. President Donald Trump is reported to have claimed in reference to China that “almost every student that comes over to this country is a spy.” Sen. Tom Cotton also recently recommended excluding Chinese postgraduate students from critical technology disciplines: “If Chinese students want to come here and study Shakespeare and the Federalist Papers, that’s what they need to learn from America. They don’t need to learn quantum computing and artificial intelligence from America.” In a May 7 letter, he and three other Republican senators called for restrictions on immigration that would include the suspension of H-1B visas and the curbing of the Optional Practical Training program, which allows foreign students to work in the United States after graduating.
Intellectual property theft is a real concern, and China has been the world’s foremost infringer. But a blanket exclusion of Chinese students from U.S. academic and scientific research is not a reasonable response—and risks harming America’s critical comparative advantage: the strength and vitality of its research enterprise and innovation ecosystem. Implementing such a blunt cudgel would undermine the very engine of innovation that it seeks to protect, at a time when the United States is engaged in an ongoing and intensifying competition for global talent.
Certainly, both Republican and Democratic U.S. policymakers are right to be exploring options to take action against technology transfer. China’s party-state has undertaken extensive campaigns of industrial espionage over decades to enable the transfer of critical technologies and the theft of intellectual property from the United States. Such efforts have corresponded with Beijing’s strategic priorities, including self-driving cars and semiconductors. Among a range of tactics, academic exchanges and research partnerships can be leveraged to those ends. Such efforts can bolster China’s military modernization or facilitate party-state coercive capabilities that enable human rights atrocities, thus threatening U.S. security and principles.
Universities have not been immune to these efforts. There have been incidents in which Chinese researchers at American universities have exploited academic openness. In several instances, members of the Chinese military have ended up at or working with U.S. universities, including recently a Chinese lieutenant who had concealed her military affiliation to conduct research at Boston University. Chinese military research institutions have also sent abroad and actively recruited students and scientists based on their experience at leading research institutions around the world.
Yet addressing this problem calls for a scalpel, not a sledgehammer. Instead of blanket bans, the focus of U.S. concerns and policy responses should be on how to counter the tactics and mechanisms that China’s party-state exploits for tech transfer. Targeted measures to mitigate risk can allow the U.S. academic research enterprise to continue to thrive and to remain open and attractive in the rivalry for global talent.
So far, the United States is winning that competition by a landslide. Contrary to the perception that Chinese graduates of U.S. institutions usually leave, the proportion of Chinese Ph.D. students who remain in the United States after graduation remains high. Data collected by the Center for Security and Emerging Technology estimate that 91 percent of Chinese Ph.D. students in artificial intelligence stay in the United States for at least five years after graduating—despite the challenges that securing visas already involves. The United States can reap benefits to its innovation ecosystem from welcoming these students.
As Silicon Valley firms that compete among themselves for the top engineers well know, the ability to attract, motivate, and retain top talent is the driving factor of success in innovation. The same is true of nation-states in the 21st century. U.S. research remains the world’s envy precisely because it can draw on the world’s talent. The desire to study, learn, work, and ultimately immigrate to the United States is one of the largest components of its soft power, which can provide a key edge in today’s technological competition with China if it is sustained and carefully cultivated.
Cutting off the science and technology talent flow from China to the United States would hand China’s party-state the gift of a forfeit in this part of that contest. While U.S. policymakers worry about the exfiltration of research from the United States, the Chinese government has been highly concerned about brain drain to the United States, especially in artificial intelligence. The very talent plans and initiatives, like China’s Thousand Talents Program, that have provoked much concern in U.S. policy debates have been attempts to reduce and reverse that loss—to promote “brain gain” instead. While the Chinese government has tried to attract foreign talent, these efforts tend to have limited success, including because of the difficulties that international researchers experience in adjusting to life and the constraints of living in China.
Going forward, a stronger and more competitive strategy for the United States would employ proactive, but carefully targeted policy action. For one, there is a strong rationale to enhance scrutiny in visa screening, and more rigorous screening could ensure that researchers who have ties to foreign militaries, such as the People’s Liberation Army, or to foreign security services and intelligence organizations would be denied the opportunity to study in the United States in the first place. Improving such screening in a fair and evidence-based manner would require increasing the resources of and ensuring that the appropriate authorities are available to the State Department and Department of Homeland Security, while promoting greater coordination among stakeholders, as well as improved leveraging of open-source information.
U.S. law enforcement and counterintelligence can also institutionalize collaborative engagement with American universities to promote best practices for risk mitigation on campuses, including creating clear points of contact for exchange and the reporting of concerns. And universities should introduce more robust and consistent requirements for disclosure of foreign funding and promote greater transparency. At the same time, for such efforts to be effective and consistent with civil rights, U.S. initiatives to prevent and punish the theft of research or intellectual property must also be careful to mitigate the risks of and introduce safeguards against bias or racial targeting.
American policymakers and university administrators must take care that the United States remains an attractive destination for foreign students and immigrant researchers. To do so requires standing against and condemning incidents of hostility toward Chinese students. Xenophobia runs counter to America’s core principles and damages the competitiveness of its global offering.
At the same time, thoughtful reforms, not simply restrictions, to the U.S. immigration system are urgently needed. In particular, increasing the number of H-1B visas offered for employers and expediting the green card process for graduates in high-priority disciplines could enhance U.S. capacity to retain STEM Ph.D. graduates who may be forced to depart otherwise. Similarly, the Optional Practical Training program should not be targeted but rather expanded and perhaps modified to create a more viable pathway to permanent residency and citizenship for those graduates from high-priority disciplines who participate. Indeed, one study found that curbing the program could cause a decline in GDP, increase unemployment, and adversely impact entrepreneurship.
Ultimately, the United States is stronger when it can not only welcome but also harness global talent, including from China. Banning students and Chinese researchers from academic science would give the Chinese Communist Party a victory.


foreignpolicy--2020-05-13--Data Governance – Part 1

Data Governance – Part 1

The global digital economy encompasses the vast physical infrastructure enabling the Internet , the full range of Internet-connected user devices , and the immense amount of data flowing through them .
The rapid growth of each of these components has collectively generated tremendous economic activity .
Over the past fifteen years , the global digital economy has grown two and a half times faster than global GDP .
One key driver behind this robust growth is the exponential volume of data being generated , processed , and monetized .
Every second , there are 2.7 million emails sent , 71,966 @ @ @ @ @ @ @ and a total of 289,351 gigabytes ( GB ) of new user data generated .
For context , 1 GB of data is equal to 677,963 pages of text , meaning that every second the equivalent a 196.2 billion-page book of new data is generated .
5G technology will connect billions more devices to the Internet through the enabling of the Internet of Things ( IoT ) , and the combination of this vast expansion of Internet-connected devices and more of the world coming online in the next decade will exponentially increase the @ @ @ @ @ @ @ , roughly 60 percent of the global population is online , with estimates showing that nearly 90 percent of the world ’ s population will come online by 2030 as Internet access is expanded throughout the developing world .
This growing reservoir of data will fuel the world ’ s emerging and incumbent technology companies , with the ability to collect and monetize this data existential for some and a determinant of future growth for all .
Over the past fifteen years , the global digital economy has grown two and a half @ @ @ @ @ @ @ the digital giants , U.S. companies hold a dominant position which has been gained largely through first-mover advantage .
The world ’ s five largest companies by revenue are all U.S.-based ( Apple , Amazon , Facebook , Google , and Microsoft ) and have a combined market value of nearly $ 4 trillion dollars .
Google accounts for 81 percent of the Internet search market , Facebook accounts for 67 percent of the global social media networks , and Amazon is responsible for 36 percent of the world ’ s online retail @ @ @ @ @ @ @ These companies leveraged first-mover advantage by reinforcing network effects—the more users in the network , the more valuable the network is for all users—accumulating a competitive data edge early on , and turning their data edge into integrated services offerings that increase the cost to users if they switch to a competitor ’ s platform .
Critically , these advantages relied heavily on these companies ’ ability to collect users ’ data across international borders , with minimal if any restrictions , and integrate it into algorithms or sell it to advertisers .
@ @ @ @ @ @ @ rise of companies such as Facebook and Google , among others , which rely on being able to collect troves of global data to enable services such as Google Maps .
The race to develop artificial intelligence applications is amplifying this demand .
Limited regulation of these companies to date has enabled them to capture the majority of revenue associated with data flows across borders .
However , countries are increasingly developing measures to regulate data flows and e-commerce transactions to exert greater control over data generated within , and passing across , @ @ @ @ @ @ @ data localization laws are becoming a standard mechanism for countries to exert control over the foreign collection of their citizens ’ data and capture a share of the value .
These laws and associated regulations place restrictions on how data can be stored within , and transferred outside of , a country .
Their aims vary , from restricting foreign companies ’ and governments ’ access to sensitive user data , to boosting foreign and domestic investment in server infrastructure , to , in limited cases , handicapping or completely inhibiting foreign companies @ @ @ @ @ @ @ ’ s borders .
To date , roughly 75 percent of all data localization measures in place are meant to ensure data privacy and security when data is transferred outside of a country .
These measures focus on restricting data transfers to countries that are deemed to have inadequate data privacy frameworks .
However , roughly 25 percent of existing data localization measures include more extensive restrictions that aim to exert influence over data flows through physical data storage infrastructure .
Countries that are intent on boosting their domestic economy ( and tax @ @ @ @ @ @ @ server infrastructure , or developing their domestic data storage industry , use data localization laws to mandate that data collected in a country be stored on a server within that country .
This strategy is currently being pursued in Indonesia and Vietnam , for example .
In a more extreme case , China has combined data localization laws with tight restrictions on foreign companies ’ operations , beginning as early as 1996 , to protect and foster the rise of its own multinational digital giants , such as Tencent and Alibaba , which @ @ @ @ @ @ @ intelligence to e-commerce .
China ’ s development and increasing protection of its digital giants through regulation have provided a roadmap for other countries to emulate .
In contrast , the U.S. and its digital giants have greatly benefited from the ability to collect data internationally through open data borders and have generally been at the forefront of opposition to emerging data localization laws .

Government Regulation and the Increasing Demand for Data Privacy and Security
The unequal gains from the rise of the digital economy represent a key economic driver behind increasingly restrictive global data governance regimes and the proliferation of data localization laws worldwide. However, the push for data regulation has also been energized by growing social and political concerns over data privacy and data security. Government regulation in these realms is in response to citizens’ demands for data privacy and protection, the increasing frequency and severity of cyberattacks, and concern over foreign governments’ access to citizens’ data. While a simplification, these major drivers provide a framework for breaking down nuanced national, transnational, and local data regulations of varying scope, which may include conflicting elements as each government or regulatory body wrestles with balancing the intended and unintended consequences of regulation. Regulatory agencies, many of which are governed by politicians—not technocrats—are determining what data can be collected, where it can be stored, whether or how it can be transmitted, and how it can be secured, not to mention who is liable for the content.
The unequal gains from the rise of the digital economy represent a key economic driver behind increasingly restrictive global data governance regimes and the proliferation of data localization laws worldwide.
As governments and citizens around the world become increasingly aware of the scope of user data that big tech companies collect, data privacy laws are becoming increasingly stringent, and governments are increasingly pushing to reign in the power of large tech companies through regulatory action. Though laws were on the books in the U.S. and Europe as far back as the 1970s, they did not effectively govern the scope of data collection activities at the heart of today’s big tech companies’ operations. The recent and ongoing regulatory push illustrates governments’ attempts to catch up, as many are racing to update existing privacy laws by placing explicit limits on companies’ collection of user data and enforcing comprehensive data security and data transfer practices. The EU led the push to modernize data privacy laws, enacting the first comprehensive data privacy regulation, the Data Protection Directive, in 1995. In 2018, the EU’s release of the General Data Protection Regulation (GDPR) modernized the framework for data privacy regulation built on enforcing citizens’ civil liberties, individual freedoms, and rights in the digital realm, and it by far represents the most comprehensive legislation to date. Specifically, the GDPR requires that companies obtain consent to collect user data, honor requests to delete user data, enforce tighter cybersecurity practices, and comply with restrictions on the international transfer of users’ data outside of the EU. GDPR implementation rocked the digital world, increasing compliance costs and generating fines of €275 million ($330 million) as of January of 2021. It continues to alter how companies operate, not only in Europe but around the world. As countries such as Brazil and India draft similar comprehensive data privacy laws, the disruptive impact on digital commerce—and these major markets—is set to increase.
While other countries are adopting laws similar to the GDPR, the EU has continued to actively push for stronger data regulation measures domestically and among its trade partners. In December of 2020, the European Commission released drafts for the Digital Services Act (DSA) and the Digital Markets Act (DMA), representing a major overhaul of existing EU Internet regulation. These acts aim to put limits on mixing commercially obtained data with personally collected data—a practice that allows tech companies to create more comprehensive data profiles; collecting business competitors’ data; and refusing access to data collected on users and businesses. The EU aims to finalize the DSA and DMA in the first half of 2022, but a number of EU states, including France, Germany, and the Netherlands, have voiced concerns that the regulations are not strict enough. The Court of Justice of the European Union (CJEU) struck down the EU-U.S. Privacy Shield, effectively ending free data flows between the U.S. and the EU, until the two sides reach a new agreement. The UK’s decision to leave the EU has generated further disputes over data protection standards. In February 2021, the Commission presented a draft adequacy decision that would allow EU-UK data flows to continue uninterrupted, but as of July 2021, this adequacy decision has yet to be approved by the European Parliament. Similar to the EU-U.S. Privacy Shield, the decision could be challenged before the CJEU. If adopted, the Commission’s adequacy decision would contain a “sunset clause” of four years, which could lead to diverging standards on data privacy becoming a source of tension between the EU and the UK. Failure to meet EU data protection adequacy could cost UK firms between $1.35 billion and $2.16 billion, according to economists’ projections.
These regulations are part of an emerging trend in which governments seek to reign in large tech companies’ power. In the U.S., ten states are suing Google in an antitrust lawsuit, alleging that it has monopolized digital advertising. China has also moved toward tighter regulation on large tech companies, unveiling legislation drafts that include proposals to block companies from using consumer data to set discriminatory prices, or sell products at prices below cost to gain market share. These moves are indicative of a coming comprehensive regulatory push, illustrating governments’ will to establish stricter data governance regimes. Spurred by the threat that incendiary speech and misinformation on social media platforms pose to democratic discourse, governments have also started to take aim at regulating digital content. Existing regulations in the EU and the United States shield social media companies from liability for content on their platforms, but in recent years, some countries have passed laws that introduce so-called intermediary liability for social media companies. Most prominently, under Germany’s 2017 Network Enforcement Act, social media companies can face fines of up to 50 million Euros ($60 million) if they fail to take down certain illegal content, such as criminal online hate speech, in a timely manner. In the U.S., there are bipartisan calls for an overhaul or revocation of Section 230 of the 1996 Communications Decency Act, which shields Internet companies from intermediary liability. Under the DSA, digital platforms would remain protected from liability for user content, but growing backlash against such protections in Europe and the U.S. signals that further regulation could be created in the near future.
Despite the complexity of emerging regulations and multiple drivers behind them, characteristics of data governance regimes are emerging around the world, with each nation’s specific regulations reflecting the unique mix of economic, political, and social variables exerting the greatest influence on governing officials. Collectively, the clear global trend is toward increased regulation and protectionism.


foreignpolicy--2020-05-13--South Korean Democracy’s New Challenge Is Its Own Corporate Giant

South Korean Democracy ’ s New Challenge Is Its Own Corporate Giant South Korea is the greatest success story of the coronavirus pandemic .
Countless lives have been saved , the world has been given a model for success , and a nation ’ s faith in its leadership has been restored after years of obscene corruption .
President Moon Jae-in ’ s approval rating reached a historic high of 71 percent this month , after a sweeping victory for his left-wing Democratic Party in the April 15 general elections .
South Korea ’ s coronavirus success has permanently reshaped @ @ @ @ @ @ @ on its legacy of authoritarian rule .
But that same success has also strengthened the most authoritarian power left in the country—Samsung .
Thanks to a health care system that ranks second to none , mass testing , and a vast surveillance system that made precise contact tracing possible , as of May 12 South Korea had only 258 coronavirus deaths in a country of more than 51 million people .
Even though the country never went on a full lockdown , two weeks ago it reported no new domestic cases thanks to @ @ @ @ @ @ @ social distancing .
To be sure , this victory would not have been possible without Samsung .
But the company ’ s role should also urge caution .
South Korea ’ s chaebol , literally “ wealth clans , ” are family-owned conglomerates that came to power in the 1960s thanks to the protectionist policies of dictator Park Chung-hee .
This kick-started South Korea ’ s economy .
But it also transferred enormous economic and political power—often at the expense of the public—into the hands of these business empires , whose internal operations @ @ @ @ @ @ @ they do North Korea .
These conglomerates now account for 77 percent of the market value of Korean companies on the Asia300 Index .
Samsung is one of the biggest chaebols , and its fingers are in many pies .
To begin with , it operates world-class medical research centers and hospitals nationwide , including the nation ’ s top hospital , Samsung Medical Center .
South Korea has universal health care , but high out-of-pocket payments means 87 percent of Korean households also use private health insurance , and Samsung is the @ @ @ @ @ @ @ testing kits and donates them abroad .
South Korea ’ s contact tracing program involves tracking Apple and Samsung mobile phones and pulling footage from CCTV cameras , which are mostly made by a former Samsung subsidiary , Hanwha Techwin .
Then there ’ s Samsung ’ s biopharmaceutical arm , Samsung Biologics .
In the first quarter of this year , ending in March , sales for Samsung Electronics rose 5.6 percent year over year , while sales for Samsung Biologics jumped 65.3 percent .
The company also ranked first in March @ @ @ @ @ @ @ Last month , it clinched a $ 362 million deal to make coronavirus antibodies for a U.S. start-up and signed a collaboration deal with Asia ’ s largest pharmaceutical company , Takeda .
Also last month , a Canadian biotech firm reported promising results in treating coronavirus patients with its HIV drug leronlimab , which Samsung Biologics will supply for up to $ 1 billion over the next few years .
But Samsung Biologics is also at the heart of the most controversial business deal in South Korean history .
On May 26 @ @ @ @ @ @ @ facto holding company , Cheil Industries , announced plans to acquire Samsung ’ s construction and trading arm , Samsung C & T .
The all-stock deal offered Samsung C & T shareholders 0.35 Cheil shares for each of their C & T shares , effectively valuing Samsung C & T ’ s operating business at less than nothing .
But that was beside the point .
South Korea has the second-highest inheritance tax in the world after Japan .
For the Samsung family , that comes to $ 7 billion , which @ @ @ @ @ @ @ investors stood to lose in the deal .
More importantly , Samsung Chairman Lee Kun-hee suffered a heart attack 12 months earlier and has remained hospitalized in a coma ever since .
His son , Vice Chairman Lee Jae-yong , was eager to inherit the throne .
The younger Lee had been plotting his rise for years , snapping up stakes in Samsung affiliates , slowly tightening his hold on the entire organization .
The merger was the royal intermarriage he needed , as it would further simplify Samsung ’ s convoluted ownership @ @ @ @ @ @ @ knew they were being fleeced .
The proxy advisory firm Glass Lewis called the deal “ profoundly unattractive , ” while the hedge fund Elliott Associates sued to block the merger in a South Korean court but predictably lost .
Still , Lee needed shareholder approval to move forward , and because he held 23.3 percent of Cheil but had no shares in C & T , as Choi Hyun-june of Hankyoreh later wrote , “ it was in his interest to inflate the value of the former and deflate the value of @ @ @ @ @ @ @ to deflate Samsung C & T ’ s value by claiming that , despite a housing boom , it had supplied only 300 apartments .
Once the merger was complete , the company announced plans to supply 10,994 apartments that month alone .
At the same time , Cheil ’ s value was inflated by having its subsidiary Samsung Biologics report net profits over $ 1.5 billion for its subsidiary Samsung Bioepis despite continued losses .
The company also floated the possibility of listing Samsung Bioepis on the Nasdaq index , which it @ @ @ @ @ @ @ value of Samsung Biologics by $ 3.78 billion , which in turn boosted Cheil ’ s value and convinced shareholders that the absurd swap ratio made sense .
The deal went through , Cheil ate Samsung C & T alive , and Lee became the de facto ruler of the Samsung empire .
Then in May 2017 , Moon was elected president .
Moon had promised corporate reform during his campaign , and in November 2018 , South Korea ’ s financial regulator suspended trade of Samsung Biologics ’ stock after ruling that @ @ @ @ @ @ @ ” during the merger .
Samsung Biologics sued the regulator .
To this day , the company is dealing with the blowback from the merger .
In April of last year , 355 plaintiffs sued in the Seoul Central District Court over the company ’ s accounting practices , seeking some $ 7 million .
In December , three executives at Samsung Electronics were each sentenced to up to two years in prison for destroying evidence tied to Samsung Biologics ’ accounting fraud .
Last month , police summoned Samsung Bioepis CEO Christopher @ @ @ @ @ @ @ , and Samsung C & T CEO Lee Young-ho was called in yet again to answer questions about the merger as part of a related probe .
Last week , a former Samsung Bioepis executive testified that Samsung told the company in 2015 to float the idea of a Nasdaq listing to secure the merger .
And this week , police summoned the vice chairman of a securities firm to ask him about his time at Samsung Biologics and the alleged accounting fraud .
Corporate power is the great counterforce to democracy in @ @ @ @ @ @ @ the nation ’ s last four presidents .
The wives of senior members of Kim Dae-jung ’ s party spent $ 165 million in bribes on fur and jewelry .
Roh Moo-hyun jumped off a cliff himself while being investigated for bribery involving Daewoo E & C .
Lee Myung-bak was detained in 2018 on charges of bribery , which included allegedly taking $ 6 million from Samsung in 2009 in exchange for pardoning Lee Kun-hee , who at the time was in prison for tax evasion and fraud .
And Park Geun-hye @ @ @ @ @ @ @ bribery , which included $ 7.1 million from Samsung .
The country has yet to figure out how to handle the problem .
In the meantime , many Koreans admire Samsung simply out of nationalistic pride , as a globally recognized symbol of Korean success .
The weeks ahead will offer insight into how far South Korea ’ s liberalization goes .
The pandemic proves that the real secret to success for Samsung , as well as the nation , has always been the Korean people .
Their health is thriving , as @ @ @ @ @ @ @ candlelight protests of 2017 , which led to Park ’ s imprisonment , were the nation ’ s largest-ever .
Last month ’ s general elections , held in the middle of a pandemic , drew the highest voter turnout in a generation .
That might give the government the impetus needed to seriously tackle the chaebols .
Despite all the corruption , Samsung Biologics is now one of South Korea ’ s most successful businesses .
Last month , Samsung as a whole surpassed Hyundai Motor to become the third-most valuable company @ @ @ @ @ @ @ percent of the country ’ s GDP .
Reform may yet come , but if the pandemic further cements Samsung ’ s power , it won ’ t come easy .

South Korea is the greatest success story of the coronavirus pandemic. Countless lives have been saved, the world has been given a model for success, and a nation’s faith in its leadership has been restored after years of obscene corruption. President Moon Jae-in’s approval rating reached a historic high of 71 percent this month, after a sweeping victory for his left-wing Democratic Party in the April 15 general elections.
South Korea is the greatest success story of the coronavirus pandemic. Countless lives have been saved, the world has been given a model for success, and a nation’s faith in its leadership has been restored after years of obscene corruption. President Moon Jae-in’s approval rating reached a historic high of 71 percent this month, after a sweeping victory for his left-wing Democratic Party in the April 15 general elections.
South Korea’s coronavirus success has permanently reshaped its politics, seemingly shutting the book on its legacy of authoritarian rule. But that same success has also strengthened the most authoritarian power left in the country—Samsung.
Thanks to a health care system that ranks second to none, mass testing, and a vast surveillance system that made precise contact tracing possible, as of May 12 South Korea had only 258 coronavirus deaths in a country of more than 51 million people. Even though the country never went on a full lockdown, two weeks ago it reported no new domestic cases thanks to a combination of these measures and voluntary social distancing. To be sure, this victory would not have been possible without Samsung. But the company’s role should also urge caution.
South Korea’s chaebol, literally “wealth clans,” are family-owned conglomerates that came to power in the 1960s thanks to the protectionist policies of dictator Park Chung-hee. This kick-started South Korea’s economy. But it also transferred enormous economic and political power—often at the expense of the public—into the hands of these business empires, whose internal operations sometimes resemble Apple and Amazon less than they do North Korea. These conglomerates now account for 77 percent of the market value of Korean companies on the Asia300 Index.
Samsung is one of the biggest chaebols, and its fingers are in many pies. To begin with, it operates world-class medical research centers and hospitals nationwide, including the nation’s top hospital, Samsung Medical Center. South Korea has universal health care, but high out-of-pocket payments means 87 percent of Korean households also use private health insurance, and Samsung is the top provider. Samsung also makes coronavirus testing kits and donates them abroad. South Korea’s contact tracing program involves tracking Apple and Samsung mobile phones and pulling footage from CCTV cameras, which are mostly made by a former Samsung subsidiary, Hanwha Techwin.
Then there’s Samsung’s biopharmaceutical arm, Samsung Biologics. In the first quarter of this year, ending in March, sales for Samsung Electronics rose 5.6 percent year over year, while sales for Samsung Biologics jumped 65.3 percent. The company also ranked first in March for brand reputation among Korean pharmaceuticals. Last month, it clinched a $362 million deal to make coronavirus antibodies for a U.S. start-up and signed a collaboration deal with Asia’s largest pharmaceutical company, Takeda. Also last month, a U.S. biotech firm reported promising results in treating coronavirus patients with its HIV drug leronlimab, which Samsung Biologics will supply for up to $1 billion over the next few years.
But Samsung Biologics is also at the heart of the most controversial business deal in South Korean history. On May 26, 2015, Samsung’s de facto holding company, Cheil Industries, announced plans to acquire Samsung’s construction and trading arm, Samsung C&T. The all-stock deal offered Samsung C&T shareholders 0.35 Cheil shares for each of their C&T shares, effectively valuing Samsung C&T’s operating business at less than nothing. But that was beside the point. South Korea has the second-highest inheritance tax in the world after Japan. For the Samsung family, that comes to $7 billion, which is exactly how much C&T investors stood to lose in the deal. More importantly, Samsung Chairman Lee Kun-hee suffered a heart attack 12 months earlier and has remained hospitalized in a coma ever since. His son, Vice Chairman Lee Jae-yong, was eager to inherit the throne.
The younger Lee had been plotting his rise for years, snapping up stakes in Samsung affiliates, slowly tightening his hold on the entire organization. The merger was the royal intermarriage he needed, as it would further simplify Samsung’s convoluted ownership structure. Samsung C&T investors knew they were being fleeced. The proxy advisory firm Glass Lewis called the deal “profoundly unattractive,” while the hedge fund Elliott Associates sued to block the merger in a South Korean court but predictably lost. Still, Lee needed shareholder approval to move forward, and because he held 23.3 percent of Cheil but had no shares in C&T, as Choi Hyun-june of Hankyoreh later wrote, “it was in his interest to inflate the value of the former and deflate the value of the latter.”
A plan was devised to deflate Samsung C&T’s value by claiming that, despite a housing boom, it had supplied only 300 apartments. Once the merger was complete, the company announced plans to supply 10,994 apartments that month alone. At the same time, Cheil’s value was inflated by having its subsidiary Samsung Biologics report net profits over $1.5 billion for its subsidiary Samsung Bioepis despite continued losses.
The company also floated the possibility of listing Samsung Bioepis on the Nasdaq index, which it never actually did. This inflated the value of Samsung Biologics by $3.78 billion, which in turn boosted Cheil’s value and convinced shareholders that the absurd swap ratio made sense. The deal went through, Cheil ate Samsung C&T alive, and Lee became the de facto ruler of the Samsung empire.
Then in May 2017, Moon was elected president. Moon had promised corporate reform during his campaign, and in November 2018, South Korea’s financial regulator suspended trade of Samsung Biologics’ stock after ruling that the company “had violated accounting standards” during the merger. Samsung Biologics sued the regulator. To this day, the company is dealing with the blowback from the merger.
In April of last year, 355 plaintiffs sued in the Seoul Central District Court over the company’s accounting practices, seeking some $7 million. In December, three executives at Samsung Electronics were each sentenced to up to two years in prison for destroying evidence tied to Samsung Biologics’ accounting fraud. Last month, police summoned Samsung Bioepis CEO Christopher Hansung Ko for questioning over the matter, and Samsung C&T CEO Lee Young-ho was called in yet again to answer questions about the merger as part of a related probe. Last week, a former Samsung Bioepis executive testified that Samsung told the company in 2015 to float the idea of a Nasdaq listing to secure the merger. And this week, police summoned the vice chairman of a securities firm to ask him about his time at Samsung Biologics and the alleged accounting fraud.
Corporate power is the great counterforce to democracy in Korean society. Bribery scandals have tainted the nation’s last four presidents. The wives of senior members of Kim Dae-jung’s party spent $165 million in bribes on fur and jewelry. Roh Moo-hyun jumped off a cliff himself while being investigated for bribery involving Daewoo E&C. Lee Myung-bak was detained in 2018 on charges of bribery, which included allegedly taking $6 million from Samsung in 2009 in exchange for pardoning Lee Kun-hee, who at the time was in prison for tax evasion and fraud. And Park Geun-hye now sits in jail for charges including bribery, which included $7.1 million from Samsung. The country has yet to figure out how to handle the problem. In the meantime, many Koreans admire Samsung simply out of nationalistic pride, as a globally recognized symbol of Korean success.
The weeks ahead will offer insight into how far South Korea’s liberalization goes. The pandemic proves that the real secret to success for Samsung, as well as the nation, has always been the Korean people. Their health is thriving, as well as their democracy. The famous candlelight protests of 2017, which led to Park’s imprisonment, were the nation’s largest-ever. Last month’s general elections, held in the middle of a pandemic, drew the highest voter turnout in a generation. That might give the government the impetus needed to seriously tackle the chaebols.
Despite all the corruption, Samsung Biologics is now one of South Korea’s most successful businesses. Last month, Samsung as a whole surpassed Hyundai Motor to become the third-most valuable company in the nation, worth roughly 20 percent of the country’s GDP. Reform may yet come, but if the pandemic further cements Samsung’s power, it won’t come easy.
Correction, May 18, 2020: The biotech firm developing coronavirus treatments with HIV drugs, CytoDyn, is based in the United States. A previous version of this story mistakenly said the firm was Canadian.