December 31, 2021

Securing the Global Digital Economy Beyond the China Challenge

The push by countries at all levels of development to modernize their information and communications networks has created unprecedented demand for technological infrastructure. Governments and industry are investing billions of dollars to expand digital connectivity worldwide. New deployments of 4G, 5G, satellites and fiber-optic cables could create huge opportunities for host nations but pose significant risks if networks are built without adequate safeguards. The U.S. has a role to play in securing the future of the internet and the global digital economy but will need to move beyond confrontation with China to succeed.

Digital access is the foundation for digital services, like fintech and e-commerce, that connect communities to trade and financial resources. As startups in Latin America and Sub-Saharan Africa draw billions in investment, their services require a strong and wide-reaching information communications technology (ICT) backbone to flourish.

A revised route to digital modernization, premised on open participation, can not only offset the local costs of China’s cyber and influence power, but pave the way for an equitable internet for all.

​​China, through its Digital Silk Road, Belt and Road Space Information Corridor and other state-led initiatives, has become a leading purveyor of ICT infrastructure virtually everywhere, especially by financing projects in less affluent nations. But these investments come with a price: cybersecurity and manipulation risks due to the influence of China’s government on its vendors.

Due to legal obligations to the Chinese state — including sharing customer data at its request — China’s tech firms cannot guarantee that they will put their clients first. Many firms also host internal Party organizations that influence decision-making. The Communist Party of China (CPC) is not omnipotent — some companies have slow-rolled compliance with information requests — but the CPC’s ongoing crackdown on tech companies is diminishing their ability to circumvent directives.

But because network modernization is an economic imperative and Chinese firms often offer lower prices than their global competitors, many countries choose to source their technology despite these political and security hazards.

Read the full article from TechCrunch.

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