U.S. says China internet censorship a burden for businesses

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BEIJING (Reuters) - The United States has labeled China's internet censorship a trade barrier in a report for the first time since 2013, saying worsening online restrictions are damaging the business of U.S. companies.

[Paul Carsten and Michael Martina| April 8, 2016 |Reuters]

Since Xi Jinping became China's president that year, the U.S. had not listed China's so-called Great Firewall as a trade impediment despite widespread outcry that the online blocks limit access to crucial information, email and search services such as those found on Google's platform.

"Outright blocking of websites appears to have worsened over the past year, with eight of the top 25 most trafficked global sites now blocked in China," the U.S. Trade Representative wrote in its annual report on foreign trader barriers.

"Over the past decade, China's filtering of cross-border internet traffic has posed a significant burden to foreign suppliers, hurting both internet sites themselves, and users who often depend on them for their business," the USTR said in the report, released last week.

The move could push the issue beyond a sticking point in bilateral ties over human rights and security, though with a litany of trade disputes already on the table, the degree to which it will feature in talks remains to be seen.

China has long operated the world's most sophisticated online censorship mechanism known as the Great Firewall.

The websites for Google's (GOOGL.O) services, Facebook (FB.O) and Twitter (TWTR.N) are all inaccessible in China. Officials say web controls help maintain social stability and national security in the face of threats such as terrorism.

Under Xi, the government has implemented an unprecedented tightening of internet controls, and sought to codify the policy within the law.

BEIJING (Reuters) - The United States has labeled China's internet censorship a trade barrier in a report for the first time since 2013, saying worsening online restrictions are damaging the business of U.S. companies.

Since Xi Jinping became China's president that year, the U.S. had not listed China's so-called Great Firewall as a trade impediment despite widespread outcry that the online blocks limit access to crucial information, email and search services such as those found on Google's platform.

"Outright blocking of websites appears to have worsened over the past year, with eight of the top 25 most trafficked global sites now blocked in China," the U.S. Trade Representative wrote in its annual report on foreign trader barriers.

"Over the past decade, China's filtering of cross-border internet traffic has posed a significant burden to foreign suppliers, hurting both internet sites themselves, and users who often depend on them for their business," the USTR said in the report, released last week.

The move could push the issue beyond a sticking point in bilateral ties over human rights and security, though with a litany of trade disputes already on the table, the degree to which it will feature in talks remains to be seen.

China has long operated the world's most sophisticated online censorship mechanism known as the Great Firewall.

The websites for Google's (GOOGL.O) services, Facebook (FB.O) and Twitter (TWTR.N) are all inaccessible in China. Officials say web controls help maintain social stability and national security in the face of threats such as terrorism.

Under Xi, the government has implemented an unprecedented tightening of internet controls, and sought to codify the policy within the law.

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According to data from the anti-censorship group GreatFire.org, almost a quarter of the hundreds of thousands of web pages, domains, encrypted sites, online searches and IP addresses that it monitors in China were blocked as of early April.

That was up from 14 percent at the time Xi assumed the presidency.

Chinese Foreign Ministry spokesman Hong Lei told a regular briefing on Friday that a country's independent choice for internet governance should be respected.

"China's internet is vigorously expanding and providing vast space for companies from other countries to grow," Hong said. "China's policy to attract foreign investment will not change."

The Cyberspace Administration of China did not immediately respond to faxed questions, while the Ministry of Commerce declined to comment.

Foreign business lobbies have long complained that Chinese internet restrictions go beyond inconvenience and actually limit business competitiveness.

The American Chamber of Commerce in China said in its most recent report on China's business environment that its members faced "severe challenges competing in China's telecommunications and internet sectors due to investment restrictions, security controls and a range of protectionist measures".

The lobby's 2016 business climate survey showed 79 percent of its members reported a negative impact on business due to internet censorship.

The USTR report said much of what China blocked online did not seem to fall within the realm of what was necessary to maintain social stability and national security.

"Much of the blocking appears arbitrary. For example, a major home improvement site in the United States, which would appear wholly innocuous, is typical of sites likely swept up by the Great Firewall," it said.

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  • commented 2016-04-12 16:36:45 -0400
    Let me suggest that it is we who should learn from the Chinese. Although their regulated boundary for information flow was probably established for selfish reasons, it is far wiser than what we have done by participating in a border-less and un-regulated World Wide Web. There is a principal involved here. Let me sum it up. One of the essential design elements for any autonomous system (for example a nation, a person, an animal, a microbe, etc.) is a well regulated border between it and its environment is a well regulated border. An autonomous system is one that operates from its own set of priorities. That border is required because an autonomous system must interact with its environment to operate, to obtain resources and to expel heat and wastes. The question is: what exchanges between the system and its environment need to be regulated? In general anything for which the density and distribution within the system differs from that within the environment. So the definition depends upon the characteristics of the autonomous system and and those of its environment. (The boundary with Canada can be a bit different than the boundary with Mexico or China…for exampl.) For the United States, the following categories of resources and wastes differ from those in its environment, which includes other nations: educated citizens, jobs, industries, goods and services, money, and information. The information part has many facets including business and cultural ones. As a nation we seem clear about protecting our pool of citizens and about keeping out illegal immigrants and terrorists. Many are ready to deport immigrants and build walls to maintain citizenship purity and minimize threats. However, we’ve been careless (in part due to an irrational belief in the benefits of free trade) about managing the flow of everything else across national boundaries. ISIS, for example, can freely recruit terrorists within the USA because we lack regulated boundaries for information flow. China can easily drain military and industrial secrets from the USA. Rich individuals and corporations can hide trillions in taxable profits offshore because of misguided, but well intentioned, economic and tax policies set up after WWII… when we focused on helping the rest of the world catch up. Middle Class jobs flee the country (with the help of global corporations who have their own autonomous priorities…for which there are no legal, political or cultural curbs. All of these ills come from our failure to establish well-regulated boundaries for our nation. Well regulated boundaries are not absolute protections, and they do create impediments to exchanges…like any bottlenecks….however they serve a vital purpose for which there is no substitute. Your body and mind have such regulated boundaries as does every other autonomous system than has a reasonable lifespan. In addition to well regulated borders, all enduring systems also have a multi-level, adaptive immune systems internal to those borders.

    The Chinese also have regulated boundaries for the flow of money and jobs. These regulations, which include import duties and currency manipulation, have enabled them to accumulate several $trillion in reserves while paying for their governmental operations and rebuild their military. On the other hand we have experienced annual trade deficits averaging over $500 billion per year for the last 20 years….. a direct result (I strongly suggest) of dismantling our trade barriers. At one time, import duties funded the Federal Government. Facilitating free trade is a net expense to the Federal Government (Supporting laws, financing a military, etc.)

    We are the fools to have no national information or economic boundaries…. all in the name of free-trade.