China and the Internet

Christopher R. Hughes, Gudrun Wacker, Christopher R. Hughes, Gudrun Wacker

• Publisher: Routledge
• Year: 2003
• ISBN:
  9781134471973
• Edition: 1
• Topic: Sozialwissenschaften
• Subtopic: Ethnische Studien

China and the Internet: Politics of the Digital Leap Forward is a comprehensive assessment of the political and economic impact of information and communication technologies (ITCs) on Chinese society. It provides in-depth analyses of topics including economic development, civil and political liberties, bureaucratic politics, international relations and security studies.The book covers the aspirations of Chinese policy-makers using the Internet to achieve a 'digital leapfrog' of economic development. Avoiding technical jargon, the book is accessible to anyone interested in the social impact of the Internet and information and communication technologies, from those in academia to business and public policy-makers.

1 ICTs in China’s Development Strategy

Xiudian Dai

[L]eapfrogging in productivity development may be achieved … by melding informatization and industrialization, the two processes reinforce each other and progress simultaneously.

(PRC Premier Zhu Rongji, October 2000)¹

At first sight, the belief of China’s reformist Premier Zhu Rongji that informatisation is the way to achieve a developmental ‘leapfrog’ seems to resound with echoes of the days when China tried to catch up with the advanced industrial states under the leadership of Mao Zedong. However, much has changed since the days of centralised planning, the promotion of heavy industry and the collectivisation of farming within a virtually self-closed agricultural society, let alone mass political movements such as the Great Leap Forward and the Cultural Revolution. Since the end of the Mao era, development has been pursued through the more modest means of introducing market mechanisms into the planned economy to achieve comparatively modest aims, such as the Four Modernisations in agriculture, industry, defence and science and technology. It is within this reformist policy framework that ICTs have become increasingly salient as a strategic priority while the global information revolution has taken place.

Any belief in the revolutionary potential of ICTs amongst the Chinese leadership is thus as likely to have been influenced by and derived from the up-beat assessments that have been produced outside China as by the heritage of the country’s own past. These range from Alvin Toffler’s theory of the ‘Third Wave’² to the host of academics and international organisations that have urged developing countries to take advantage of the global communications revolution to jump-start economic development.³ It is the European Commission, for example, that makes the claim that ‘ICT and new networks offer real opportunities and advantages to those who have the will and make the effort to use them, and these potentials should be actively pursued and not denied’.⁴ Others warn that ‘[t]he economic future will belong to the technologically adept’.⁵

While many observers and policy-makers seem to think that the world’s problems can be solved by simply spreading the ‘digital opportunity’ to get hooked up to networks, however, China’s leaders might do well to heed those with a more conventional approach to development who favour concentrating on more traditional tools and methods.⁶ Such cautious voices argue that the ‘new economy’ is a phenomenon confined largely to the United States, with limited relevance for other countries.⁷ Developing economies, in particular, may be unable to catch up with the industrialised world in the ‘information age’ because ‘technology is a reward of development, making it inevitable that the digital divide follows the income divide’.⁸ If such pessimism is warranted, then ‘leapfrogging’ to a higher level of economic and social development on the back of ICTs will be impossible.⁹ The debate on the relationship between ICTs and development is thus far from conclusive.

In some respects, the Chinese strategy for meeting the challenges of the information revolution can be seen as lying between these poles of utopianism and cynicism. As Zhu Rongji’s statement makes clear, at its core lies the attempt to achieve an optimal combination of the ‘new economy’ and the ‘old economy’, or digitalisation hand-in-hand with industrialisation. This chapter will assess the feasibility of such an approach by looking at the ways in which government strategy and public policy have impacted on the process of infrastructure development, technological innovation, the take-up of new ICTs (in particular the Internet) and administrative efficiency in China.

Chinese Optimism in the Global Context

Government policies and programmes to promote the development and application of ICTs in the context of general scientific and technological modernisation began to be initiated in China in the mid-1980s. The most significant of these was the ‘863’ Programme (so-called because it was launched in March 1986),¹⁰ which aims at promoting excellence in scientific research and the building of a national capacity in high technologies that can compete with the western industrialised countries. Under its umbrella, state research funds have been allocated to leading universities and institutions such as the Chinese Academy of Sciences, which are engaged in strategic research and development activities. Its projects embrace telecommunications, optical-electronics, artificial intelligence and information processing, as well as space technologies and biotechnologies. In many respects, the ‘863’ Programme can be seen as the Chinese version of the SDI (Strategic Defence Initiative), Eureka and the Fifth Generation Computer in the industrialised countries.

The twin-track strategy of developing informatisation in parallel with industrialisation began somewhat later, during the period of political transition from the leadership of Deng Xiaoping to that of Jiang Zemin as the ‘core’ of the third generation of CCP leadership, which began after the government’s crackdown of the Tiananmen protesters in June 1989 and ended with the death of Deng in 1997. It was at this time that the government launched its Informatisation of the National Economy (INE) programme. More recently, the strategic thinking behind this project has been incorporated into the Tenth Five-Year Plan (2001–5), which makes informatisation of the national economy and society a strategic priority.¹¹

The INE initiative was launched just as a consensus began to emerge among international organisations that the global information revolution could provide an opportunity for many, if not all, developing countries to leapfrog in both technological and economic development.¹² It was during the early 1990s that the European Commission actively began to promote ICTs as a strategic tool for economic growth in developing countries, seeing the information society as offering more efficient management for small and medium-sized enterprises (SMEs), enhanced provision of economic information, better training, interactive user/server networks, access to international markets and generally improved efficiency for government and administration.¹³ The positive atmosphere surrounding the future of ICTs was encapsulated when leaders of the G7 countries, the European Commission and Southern Africa heralded the emergence of a global ‘information society’ that would have a profound impact on socio-economic development, when they met in Brussels in February 1995.

It is worth noting here that this international optimism has continued well into the new millennium, as was made clear when leaders of the western industrialised countries confirmed their belief that new ICTs present ‘one of the most potent forces in shaping the twenty-first century’ that are ‘fast becoming a vital engine of growth for the world economy’ when they met for the G8 summit (the G7 countries plus Russia) in Okinawa in July 2000.¹⁴ Despite a note of caution over the need to address the existence of a ‘digital divide’ within and between countries, there was much to encourage Chinese leaders when the meeting made a declaration which concluded that countries that succeed in harnessing the potential of ICTs ‘can look forward to leapfrogging conventional obstacles of infrastructural development, to meeting more effectively their vital development goals … and to benefiting from the rapid growth of global e-commerce’ (G8, 2000). Even as late as February 2002, well after the bursting of the e-commerce bubble, the UNDP felt confident enough to sponsor a Global Digital Opportunity Initiative. When this was launched at the World Economic Forum in New York, the president of the Markle Foundation remained adamant that the appropriate deployment of new technologies can ‘offer an unprecedented opportunity to meet global development challenges’.¹⁵

The technological factors feeding such optimism are not hard to find. The European Commission, for example, argues that moving towards the information society ‘entails a reduction of time and space constraints and presents a panoply of new tools with unparalleled capacities enabling the developing countries to make some great leaps forward in technology by economizing on the intermediary stages which the industrialized countries have gone through’.¹⁶ Table 1.1 illustrates the scale of the impact that innovation in ICTs has had on the costs of transmitting data. According to these figures, it is 500 times more expensive to deliver a 40-page document using conventional posts (courier) than it is by using e-mail.¹⁷ In light of such statistics, it seems reasonable enough to believe that economically less-developed countries should be able to reap significant economic gains from innovations in the communications sector.

Table 1.1 The costs of communications

Model I: Vertical (historical) comparison	The cost of transmitting a trillion bits of information from Boston to Los Angeles has fallen from USD 150,000 in 1970 to 12 cents today.
Model II: Horizontal (technological) comparison	E-mailing a 40-page document from Chile to Kenya costs less than 10 cents, faxing it about USD 10, and sending it by courier USD 50.

Source: Data from UNDP, Human Development Report 2001.

It has been in the context of this growing international consensus over the opportunities and challenges of the global information revolution, then, that the Chinese leadership has given increasing ‘prominence to the development of science, technology and education’, and acceleratation of ‘the informatization of national economic and social progress’¹⁸ to meet the priority of economic restructuring, to borrow the words of President Jiang Zemin. With the economic benefits of informatization depending on the existence of a competitive ICT sector, it is clear why this area of the economy has been made a priority in the current Five-Year Plan.

The priority given to informatisation by the government is made quite clear by the thinking of the Ministry of Information Industry (MII), which sees ICTs as a key sector of industry that has risen from making a total value-added contribution to GDP of 1.98 per cent during the Eighth Five-Year Plan (1991–5), to account for 3.4 per cent during the Ninth Five-Year Plan (1996–2000), and with expectations for it to notch up 6.7 per cent during the Tenth Five-Year Plan. While such figures may not be overwhelming, the MII explains that ICTs also play a strategic role because they provide the infrastructure necessary to support the growth of other industrial sectors in the information age. It thus calls ICTs a ‘dragon head’ (longtou), creating new economic dynamics that can help to promote the reform of more conventional industries and raise their productivity by reducing transaction costs. They are even seen as helping with efforts to protect the environment and achieve sustainable development by reducing material consumption.¹⁹

Head of the MII, Wu Jichuan, explains that the government’s national strategy for the promotion of the ICT sector in the first ten years of the twenty-first century includes the following principal elements:

• Speeding up the construction of a new generation of ICT infrastructure alongside the strategic and structural adaptation of the current infrastructure, to reflect the need for convergence between telecommunications networks, TV transmission networks (in particular cable TV) and computer networks (such as the Internet).
• Achieving breakthroughs in the core areas of ICTs in order to foster a competitive manufacturing sector with an indigenous supply of key components based on Chinese Intellectual Property Rights (IPRs). Breakthroughs are expected in areas such as large-scale integrated circuits (LSIC), high-speed and high-capacity computers, large-scale operating systems, super high-speed network systems, new generations of mobile communications and digital TV.
• The systematic promotion of the application of ICTs in every domain of economic and societal development, centred on the re-engineering of conventional industrial sectors through key initiatives such as ‘Government Online’, ‘Enterprise Online’ and ‘Family Online’.
• Encouraging more foreign and domestic investment by improving the effectiveness of governance and implementation of the rule of law in the ICT sector.²⁰

It is hard to deny that such ambitious objectives might be characteristic of Chinese government propaganda over the decades. However, it will be argued below that a proper appraisal must also acknowledge that the visions and optimism of the leadership are being translated into policies which have become a real driving force behind the quest for what might be called a ‘new economy with Chinese characteristics’.

Broadband China: Creating the Infrastructure

The development of an information infrastructure is broadly recognised as having a profound and wide-ranging impact on economies and societies.²¹ China has lon...