Is China's Censorship Software a Trade Barrier?

♠ Posted by Emmanuel in ,, at 6/09/2009 02:38:00 AM
Former US President Bill Clinton believed that China opening up to the world via trade would result in greater personal rights and freedoms for the Chinese people. According to this line of thinking, a taste of the Western consumerist conception of the "good life" would embolden the PRC's citizens to ask for more leeway in interacting with the rest of the world without filtering through the lenses of official censors.

Let's just say that Clinton's thinking hasn't really come true. I have previously argued that export-led industrialization was ideal for PRC leadership since control of the "commanding heights" of the economy--finance, production, etc.--would remain firmly in state hands. Insofar as many other East Asian states before it have maintained such a grip, China has wanted to do the same and has largely succeeded. Likely emboldened by the non-event that was the twentieth anniversary of the Tiananmen massacre, China is reportedly asking PC makers--particularly foreign ones--to load up on censorship software.

I first saw this news break on the WSJ, though the New York Times fills in more of the preliminary details:

China has issued a sweeping directive requiring all personal computers sold in the country to include sophisticated software that can filter out pornography and other “unhealthy information” from the Internet. The software, which manufacturers must install on all new PCs starting July 1, would allow the government to regularly update computers with an ever-changing list of banned Web sites.

The rules, issued last month in a government directive, ratchet up Internet restrictions that are already among the most stringent in the world. China regularly blocks Web sites that discuss the Dalai Lama, the 1989 crackdown on Tiananmen Square protesters, and the Falun Gong, the banned spiritual movement.

But free-speech advocates say they fear the new software could make it even more difficult for China’s 300 million Internet users to obtain uncensored news and information. “This is a very bad thing,” said Charles Mok, chairman of the Hong Kong chapter of the Internet Society, an international advisory group on Internet standards. “It’s like downloading spyware onto your computer, but the government is the spy.”

Called Green Dam — a referenceto slogans that describe a smut-free Internet as “green” — the software is designed to filter out sexually explicit images and words, according to the company that designed it. Computer experts, however, warn that once installed, the software could be directed to block all manner of content or allow the government to monitor Internet use and collect personal information...

PC makers who serve the Chinese market, among them Dell, Lenovo and Hewlett Packard, said they were studying the new rules and declined to comment. But privately, industry executives in the United States said they were unnerved by the new rules, which were issued by the Ministry of Industry and Information Technology with no consultation and no advance warning.

Beyond the nettlesome issue of abetting government censorship, they said six weeks was not enough time to shift production on such a large scale. “Many of us are going to take it in the neck with this mandate,” said one executive. “It has put people into five-alarm mode.”

This is not the first time that foreign companies have been enlisted in government efforts to police the Internet. Google already removes politically forbidden results yielded by its popular search engine, Microsoft allows censors to block content on its blog service and Yahoo was widely criticized for turning over information that was used to jail a journalist. “I would advise dissidents to buy computers before July 1,” said Clothilde Le Coz, the head of the Internet freedom desk of Reporters Without Borders.

More than 40 million personal computers were sold last year in China, one of the fastest growing markets. Despite the slowing economy, industry analysts expect that figure to rise by 3 percent this year.

A group of industry representatives met with American officials Monday to express their displeasure with the new rules, said Susan N. Stevenson, a spokeswoman for the United States Embassy in Beijing. “We view any attempt to restrict the free flow of information with great concern,” she said...
Foreign computer brands have been singled out:

Although the directive is somewhat imprecise and suggests that manufacturers can provide the software as a compact disc, it also says that it must be installed on computer hard drives as a backup file. The five-point circular uses the word “preinstall” repeatedly and the first clause unequivocally states: “Imported computers shall preinstall the latest available version of the ‘Green Dam’ software before they are sold in China...”

Industry experts and civil libertarians say they are worried the software may simply be a Trojan horse for greater Internet control. The software developers have ties to China’s military and public security agencies, they point out, and Green Dam’s backers say the effort is supported by Li Changchun, the country’s chief propaganda official and a member of the decision-making body of the Communist Party, the Politburo Standing Committee...

Last week, as the 20th anniversary of the military crackdown at Tiananmen approached, the government blocked a host of Internet services, including Twitter, Microsoft’s and Flickr, a photo-sharing site, though by Monday evening, these sites had become available again. YouTube has been inaccessible in China outside Hong Kong since March.
There's also the not-insignificant matter of the software being fundamentally unsound according to a number of software experts:

Even beyond ethical concerns, those who have tested the new software describe it as technically flawed. An American software engineer said it led machines to crash frequently. Others worry that it could leave tens of millions of computers vulnerable to hackers. So far, at least, there is no version for the Linux operating system and Apple’s Macintosh system.
It will be interesting to see if US PC sellers will ask the Chinese government to scotch these plans. Or, they may just back down Microsoft and Google-style rather than be hampered in accessing probably the world's largest consumer market. Ironically, instead of market access leading to greater personal rights and freedoms, Beijing has been able to dangle this very carrot to get foreigners to comply with its wishes and negate Clinton's intuition in the process.

I believe that trade remedies can be pursued here by the US if it really wanted to. For instance, technical barriers to trade can be invoked insofar as use of the software has been found to foul up machine operation. If it is true that local machines will be similarly messed around with after installing this software, there are additional market access considerations that come into play. Why would Chinese consumers pay for the privilege of having semi-functional machines?

The though police are at it again. Bill Clinton, we hardly knew ye.