Cyber Policy and the 19th Party Congress

The Chinese Communist Party (CCP) 19th Party Congress concluded on October 24. The week-long session marked a twice in a decade leadership reshuffle and codified President Xi Jinping’s elevated status in China’s political system. Yet, the Party Congress has received less attention for what it reveals about the leadership’s approach to the digital economy and building China into a “cyber superpower.” Key leadership changes and policy statements from the Congress make clear that the development of information and communications technology (ICT) has become a political priority as Xi enters his second term.

Q1: What are the implications for China’s technology policies of President Xi’s elevated status within China’s Communist Party?

A1: The Communist Party elevated President Xi Jinping’s status by amending the party’s constitution to include his name and ideas (“Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era”). The move gives him the highest party status for a sitting ruler since Mao Zedong, cementing his power to pursue his policy agenda in his second term.

Bolstering the digital economy and the ICT industry overall is central to Xi Jinping Thought. He made this clear in his April speech at the Work Conference on Cybersecurity and Informatization. Xi is directly shaping these strategies and policies as the chair of the Leading Small Group (LSG) for Cybersecurity and Informatization. With the creation of this institution and its functional office, the Cyberspace Administration of China (CAC), Xi centralized decisionmaking over cyber policy, leading to the rapid build-out of a new governance framework for cyberspace, with the cybersecurity law as the centerpiece. Consolidation of Xi’s power will further accelerate implementation of these efforts. Up next could be completion of unfinished draft measures like those for securing critical information infrastructure.

Q2: What did President Xi signal about the direction of technology policy in his opening speech?

A2: President Xi delivered a speech at the start of the Congress that signaled the party’s policy priorities for the next five years and assessed the leadership’s work since the previous Congress in 2012. The Chinese leadership has a long history of referencing technology innovation in speeches and directives. Yet the language used to describe technology in this speech is striking, sending a strong signal that technology, particularly information technology (IT) sectors, are a core part of Xi’s vision for his second term. It is the first time that an opening speech identifies specific terms such as artificial intelligence (AI) and digital China as priorities in the country’s development plans. For example, the speech calls for accelerating the “deep integration of the Internet, big data, and artificial intelligence with the real economy.” It calls for building a “science and technology superpower, quality superpower, aerospace superpower, cyber superpower” and “intensifying cooperation in frontier areas such as digital economy, AI, nanotechnology, and quantum computing, and advancing the development of big data, cloud computing, and smart cities so as to turn them into a digital silk road of the 21st century.”

More broadly, the speech makes clear that technology innovation underpins China’s economic well-being. It is notable that the speech does not repeat the target of doubling per capita gross domestic product (GDP) by 2020 from the last Congress. Deemphasizing GDP and focusing instead on what the Chinese government calls “supply side structural reforms” (i.e., boosting high-tech sectors rather than traditional heavy industry) implies an ideological shift in the CCP, with the leadership prioritizing higher-quality drivers of economic development.

Q3: What do leadership changes during the Party Congress mean for technology policy?

A3: The key leadership changes impacting technology policy involve three people: Han Zheng, Chen Min’er, and Xu Lin. Their elevated status is another signal of the growing importance of the digital economy and cyberspace policy.

Han Zheng

Han Zheng is a new member of the seven-member Politburo Standing Committee, the country’s top decisionmaking body. As party secretary of Shanghai, Han has been a major advocate of advancing the role of Internet technology in the city’s development. He also has advocated for carrying out Xi’s vision for building China into a national cyber power. In August of this year, he gave a speech calling for developing new Internet technologies to upgrade traditional industry and the acceleration of digitalization and smart city development. He also signaled the importance of the cybersecurity law when he called for shifting from “management” to “governance” of the Internet, implying the need for a most robust legal framework.

Chen Min’er

Chen is a new member of the 25-member Politburo. In the months before the Congress, he became the party secretary of Chongqing, a politically important municipality in southwest China.

Chen is a key figure known for pushing major digital initiatives in China as the party secretary and governor of Guizhou before his Chongqing role. Guizhou is a rural region, but under Chen the province became a nationally recognized hub for big data, cloud, and smart city technology. China’s three large state carriers—China Telecom, China Unicom, and China Mobile—all signed major deals in the region to construct data centers. Guizhou had the first national big data comprehensive pilot zone. Chen brought open Wi-Fi to Guiyang, which is not common at the city level in China. Chen is a proponent of the private sector and has close ties to a number of foreign and domestic ICT firms, including Foxconn and Qualcomm.

It is possible that the Xi administration is looking to replicate parts of Chen’s Guizhou model nationally, with Chen playing a role overseeing technology development in politically significant projects and regions. Chongqing will also be an important place to watch in this regard.

Xu Lin

Xu Lin is the director of the Office of the LSG for Cybersecurity and Informatization and has a seat on the Central Committee. Xu’s predecessor, Lu Wei, was neither a full or alternate member of the Central Committee. The move represents the rising power of the LSG and the CAC, solidifying these institutions as powerful players shaping and coordinating cyber policy. It also further consolidates Xi’s control over cyber policy, as Xu is known as a trusted associate of the president from when Xi was party secretary in Shanghai. That said, it will be important to watch Xu’s career trajectory. It is not clear whether Xu will remain at the CAC. If rumors are true that he will be replaced by the party chief of Tianjin, this creates more uncertainty around technology sector leadership.

Q4: What are the signposts to watch next for the direction of China’s technology policy?

A4: Key leadership announcements in the run-up to the National People’s Congress in March 2018 will provide more information about the technology policy agenda for Xi’s next term. For example, who will be the Vice Premier covering industrial and technology policy (replacing Ma Kai)?

In terms of legislation, Chinese leaders are still grappling with how to implement China’s cybersecurity law. The outcome of ongoing debates over the definition of critical information infrastructure, how to manage cross-border data flows and personal data, and the relationship between Chinese and international standards regimes will all be important to watch.

Samm Sacks is a senior fellow with the Technology Policy Program at the Center for Strategic and International Studies in Washington, D.C. Special thanks to Feng Chucheng (Blackpeak Group), Jennifer Meng and Paul Triolo (Eurasia Group), Qiu Mingda (CSIS), and Graham Webster (Paul Tsai China Center at Yale Law School) for sharing invaluable insight and research.

Critical Questions is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

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Samm Sacks