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  1. A panel of censors set up to vet mobile video games in China has signalled it will be hard to please. State media reports that of the first 20 titles it assessed, nine were refused permission to go on sale. The Xinhua news agency added that developers of the other 11 had been told they had to make adjustments to remove "controversial content". There has been a clampdown on new video game releases in the country since March. The authorities have voiced concerns about the violent nature of some titles as well as worries about the activity being addictive. President Xi Jinping has also called for more to be done to tackle a rise in near-sightedness among the young - something that the country's ministry of education has linked to children playing video games at the cost of spending time on outdoor pastimes. It was announced in August that a new body - the State Administration of Press and Publications - had taken over responsibility for approving games and that it would limit the number of online titles available. And although it has not been specified, some experts are assuming that the new panel will operate under its auspices. Games backlog Until an announcement by China's Communist Party's central committee on Friday, the online video games review panel's existence had not been made public. Xinhua said it is comprised of gaming experts, government-employed researchers, and representatives from the media and video games industry. But it provided no other information about who they were or the titles they had already examined. Nor was there any hint of when the freeze on new releases might end. The Wall Street Journal suggested publishers might have to wait until at least March after the next annual meeting of parliament. Analysts appear split over how to interpret the latest development. A research note from the US-based Jefferies Financial Group described the move as being "progressive" and speculated that a timetable for approved video games releases would soon follow. But South Korea's Kiwoom Securities said the committee's existence indicated that the Chinese government intended to tighten regulation of the industry. One industry-watcher observed there was a big backlog to clear, meaning it could be a long while before matters settled down. "China is the biggest games market globally - there had always been some stiffness of regulation around certain games but the mobile space had been relatively unscathed from that and there seemed to be a lot more freedom for smartphone titles," said Piers Harding-Rolls, research company IHS Markit's games expert. "But you now have a new organisation and what sounds like more stringent criteria. "There will be a learning process involved in that for publishers and I think we could be waiting six to 12 months before things return to some sort of normality." Source
  2. BEIJING/OTTAWA (Reuters) - China warned Canada on Saturday that there would be severe consequences if it did not immediately release Huawei Technologies Co Ltd’s [HWT.UL] chief financial officer, calling the case “extremely nasty.” Meng Wanzhou, Huawei’s global chief financial officer, was arrested in Canada on Dec. 1 and faces extradition to the United States, which alleges that she covered up her company’s links to a firm that tried to sell equipment to Iran despite sanctions. The executive is the daughter of the founder of Huawei. If extradited to the United States, Meng would face charges of conspiracy to defraud multiple financial institutions, a Canadian court heard on Friday, with a maximum sentence of 30 years for each charge. No decision was reached at the extradition hearing after nearly six hours of arguments and counter-arguments, and the hearing was adjourned until Monday. In a short statement, China’s Foreign Ministry said that Vice Foreign Minister Le Yucheng had issued the warning to release Meng to Canada’s ambassador in Beijing, summoning him to lodge a “strong protest.” There was no immediate reaction from the office of Canadian Foreign Minister Chrystia Freeland on Saturday. When asked about the possible Chinese backlash after the arrest of Huawei’s CFO, Prime Minister Justin Trudeau told reporters on Friday that Canada has a very good relationship with Beijing. Canada’s arrest of Meng at the request of the United States while she was changing plane in Vancouver was a serious breach of her lawful rights, Le said. The move “ignored the law, was unreasonable” and was in its very nature “extremely nasty,” he added. “China strongly urges the Canadian side to immediately release the detained person, and earnestly protect their lawful, legitimate rights, otherwise Canada must accept full responsibility for the serious consequences caused.” The statement did not elaborate. “There will probably be a deep freeze with the Chinese in high-level visits and exchanges,” David Mulroney, former Canadian ambassador to China, said on Friday. “The ability to talk about free trade will be put in the ice box for a while. But we’re going to have to live with that. That’s the price of dealing with a country like China.” Meng’s arrest was on the same day that U.S. President Donald Trump met in Argentina with China’s Xi Jinping to look for ways to resolve an escalating trade war between the world’s two largest economies. The news of her arrest has roiled stock markets and drawn condemnation from Chinese authorities, although Trump and his top economic advisers have played down its importance to trade talks after the two leaders agreed to a truce. A Huawei spokesman said on Friday the company has “every confidence that the Canadian and U.S. legal systems will reach the right conclusion.” The company has said it complies with all applicable export control and sanctions laws and other regulations. Source
  3. BEIJING (Reuters) - Chinese Vice Premier Liu He spoke on Tuesday with U.S. Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer, exchanging views on pushing forward the next stage of trade talks, China’s Commerce Ministry said. Source
  4. WASHINGTON (Reuters) - U.S.-China trade negotiations need to reach a successful end by March 1 or new tariffs will be imposed, U.S. Trade Representative Robert Lighthizer said on Sunday, clarifying there is a “hard deadline” after a week of seeming confusion among President Donald Trump and his advisers. Global markets are jittery about a collision between the world’s two largest economic powers over China’s huge trade surplus with the United States and U.S. claims that China is stealing intellectual property and technology. “As far as I am concerned it is a hard deadline. When I talk to the president of the United States he is not talking about going beyond March,” Lighthizer said on the CBS show “Face the Nation,” referring to President Donald Trump’s recent decision to delay new tariffs while talks proceed. “The way this is set up is that at the end of 90 days, these tariffs will be raised,” said Lighthizer, who has been tapped to lead the talks and appeared to tamp down expectations that the negotiation period could be extended. After a turbulent week in markets, investors “can be reassured that if there is a deal that can be made that will assure the protection of U.S. technology...and get additional market access...the president wants us to do it,” Lighthizer said. “If not we will have tariffs.” In Argentina last weekend, Trump and Chinese President Xi Jinping agreed to a truce that delayed the planned Jan. 1 U.S. hike of tariffs to 25 percent from 10 percent on $200 billion of Chinese goods while they negotiate a trade deal. However, the arrest of a top executive at China’s Huawei Technologies Co Ltd’s [HWT.UL] has roiled global markets amid fears that it could further inflame the China-U.S. trade row. In Beijing on Sunday, China’s foreign ministry protested the arrest to the U.S. ambassador. In a series of appearances on the Sunday morning talk shows, Lighthizer, economic adviser Larry Kudlow, and trade adviser Peter Navarro insisted the trade talks with China would not be derailed by the arrest, which they deemed solely a law enforcement matter. U.S. equity markets have staked much on the outcome of the talks. Stocks climbed early in the week on optimism tensions between the two sides were easing, then cratered after Trump claimed he was a “tariff man” after all. He also seemed to indicate the talks could be extended. But Lighthizer, in his first comments since being appointed to lead the negotiations, said the United States will need concessions across a number of areas in coming weeks if the higher tariffs are to be voided. That includes demands for increased purchases of U.S. goods in a more open Chinese market, as well as “structural changes” to a system that, for example, forces American firms to turn over technology to Chinese partners as a condition of doing business. “We need agricultural sales and we need manufacturing sales. We need structural changes on this fundamental issue of non-economic technology transfer,” Lighthizer said. The demands are similar to those made under previous Democratic and Republican presidents, but Lighthizer said he felt Trump’s willingness to go beyond “dialogue” and impose tariffs will produce results. Source
  5. The B.C. government is suspending a trade mission to China due to an ongoing court case against a senior Huawei executive arrested earlier this month in Vancouver. The B.C. government is suspending a trade mission to China due to an ongoing court case against a senior Huawei executive arrested earlier this month in Vancouver. Meng Wanzhou, the chief financial officer of Huawei Technologies, was arrested Dec. 1 at Vancouver International Airport while en route to Mexico and is being sought for extradition to the U.S. on allegations of fraud. It’s alleged the tech giant used a subsidiary named Skycom to conduct business with an Iranian telecommunications company, a violation of U.S. sanctions against trade with Iran. Meng is accused of misrepresenting Huawei’s connection with Skycom to several banks involved in the case, leading to one bank clearing more than $100 million dollars worth of transactions. In a statement shared Sunday, B.C. Minister of Trade Bruce Ralston said a number of upcoming meetings in China would be rescheduled. The meetings were a part of an ongoing trade mission in Asia. “The Province of British Columbia has suspended the China leg of its Asian forestry trade mission due to the international judicial process underway relating to a senior official at Huawei Technologies Co., Ltd.,” read the statement. “British Columbia values its strong trade relationship with China, one based on mutual respect and close economic and cultural ties that have been established over many decades. Our forest products industry remains committed to our relationship with our valued Chinese customers.” The mission was being led by Minister of Forests Doug Donaldson and included a number of industry representatives. The team has already completed a series of meetings in South Korea and will wrap up its schedule meetings in Japan on Tuesday after which the trade delegation will return to Canada. The cancelled Chinese meetings will be rescheduled “at the earliest convenient moment,” according to Ralston’s statement. Meng, who father is the founder of the company, returns to court on Monday to continue seeking bail. She was arrested using a provisional arrest warrant issued by a New York state judge in August. A federal Justice Department lawyer had argued that Meng’s vast resources and lack of meaningful connection to Canada made her a flight risk, while Meng’s defence lawyer said she would do no such thing to prevent humiliation to her family. Some commentators have likened Meng’s arrest to the hypothetical detention in China of a Mark Zuckerberg sibling or a cousin of Steve Jobs, with one even describing Meng as being an Ivanka Trump-like figure in her father’s company. Source
  6. BEIJING (Reuters) - China’s foreign ministry called in the U.S. ambassador on Sunday to lodge a “strong protest” over the arrest in Canada of Huawei Technologies Co Ltd’s [HWT.UL] chief financial officer, and said the United States should withdraw its arrest warrant. Meng Wanzhou, Huawei’s global chief financial officer, was arrested in Canada on Dec. 1 and faces extradition to the United States, which alleges that she covered up her company’s links to a firm that tried to sell equipment to Iran despite sanctions. The executive is also the daughter of the founder of Huawei. Chinese Vice Foreign Minister Le Yucheng told U.S. ambassador Terry Branstad that the United States had made an “unreasonable demand” on Canada to detain Meng while she was passing through Vancouver, China’s Foreign Ministry said. “The actions of the U.S. seriously violated the lawful and legitimate rights of the Chinese citizen, and by their nature were extremely nasty,” Le told Branstad, comments similar to those he made to Canada’s ambassador the night before. China strongly urges the United States to pay attention to China’s solemn and just position and withdraw the arrest warrant on Meng, Le added. “China will respond further depending on U.S. actions,” he said, without elaborating. Le also told the Canadian ambassador on Saturday that there would be severe consequences if it did not immediately release Meng. Source
  7. BEIJING (Reuters) - China reported far weaker than expected November exports and imports, showing slower global and domestic demand and raising the possibility authorities will take more measures to keep the country’s growth rate from slipping too much. November exports only rose 5.4 percent from a year earlier, Chinese customs data showed on Saturday, the weakest performance since a 3 percent contraction in March, and well short of the 10 percent forecast in a Reuters poll. Analysts say the export data showed that the “front-loading” impact as firms rushed out shipments to beat planned U.S. tariff hikes faded, and that export growth is likely to slow further as demand cools. The customs data showed that annual growth for exports to all of China’s major partners slowed significantly. Exports to the United States rose 9.8 percent in November from a year earlier, compared with 13.2 percent in October. To the European Union, shipments increased 6.0 percent, compared with 14.6 percent in October. Exports to South Korea fell from a year earlier, while in October they rose 7.7 percent. SLOWEST IMPORT GROWTH SINCE 2016 Import growth was 3 percent, the slowest since October 2016, and a fraction of the 14.5 percent seen in the poll. Imports of iron ore fell for a second time, reflecting waning restocking demand at steel-mills as profit margins narrow. “The sluggishness in imports and exports is in full swing,” said Wang Jun, chief economist of Zhongyuan Bank in Beijing. The soft imports “show a relatively significant pullback in domestic demand”, he added. In recent months, Chinese exports had expanded robustly, which economists said reflected front-loading of cargoes before a now-postponed plan to hike U.S. tariffs of $200 billion of Chinese goods to 25 percent from 10 percent on Jan. 1. The November trade numbers came out less than a week after Presidents Donald Trump and Xi Jinping agreed to a 90-day truce delaying that tariff hike as they negotiate a trade deal. November’s China numbers might add a sense of urgency. Stirring fears of a reignition of trade tension, the daughter of Huawei Technologies’ founder, a top executive at the Chinese technology giant, was arrested in Canada on Dec. 1 and faces extradition to the United States, threatening to drive a wedge between the U.S. and China. TALKS ‘GOING VERY WELL’ U.S. President Donald Trump on Friday sounded an optimistic note about trade negotiations with China as his top economic advisers downplayed friction from the arrest of Meng Wanzhou. “China talks are going very well,” Trump said on Twitter, without providing any details. In a note, analysts at Haitong Securities in Shanghai said “Growth in shipments of Chinese goods on U.S. 200 billion tariff list has started to pull back, indicating that frontloading effects may be starting to recede.” “Now with U.S. and China agreeing not to escalate trade tensions any longer, China will start purchasing U.S. agricultural goods, which may narrow China-U.S. trade surplus in the future,” they said. China’s November trade surplus with the United States was a record $35.55 billion. The October surplus was $31.78 billion. But China’s imports from the U.S. in November fell 25 percent from a year earlier, while the annual decline in October was only 1.8 percent. For trade with all countries, China’s surplus was $44.74 billion for November, compared with forecasts of $34 billion and October’s surplus of $34.02 billion. On Thursday, the U.S. reported that its global trade deficit in October jumped to a 10-year high, and that the deficit with China surged 7.1 percent to a record $43.1 billion. THE WEAKER YUAN Economists say one factor helping keep up Chinese exports this year is that the yuan CNY=CFXS has weakened more than 5 percent against the dollar, helping to make Chinese products more competitive abroad. Jonas Short, head of the Beijing office of brokerage Everbright Sun Hung Kai, said the weaker yuan “should boost industrial exports over the coming months. Typically there is a six-month lag between the value of industrial export orders and currency movements.” Economists in recent months have penciled in a deterioration in China’s export outlook in 2019, factoring in higher U.S. tariffs on a wider range of Chinese goods. Chinese policymakers are expected to offer more policy support and deliver more support measures if domestic and external conditions continue to deteriorate. China’s central bank has cut the amount of cash that banks must hold as reserves four times this year, as policymakers seek to steady the slowing economy amid the trade war with the United States. The government aims for growth of around 6.5 percent this year, compared with 2017’s 6.9 percent pace. Yang Yewei, an analyst at Southwest Securities in Beijing, said that as global demand cools, “domestic growth-boosting measures should be more effective”. Source
  8. Gamers fear Valve’s PC gaming platform will be heavily restricted in China Valve officially signs with Shanghai’s government to launch Steam China in Shanghai, as well as bringing the next The International for Dota 2 to the city. Right now, the global version Steam is in a weird position in China. It’s not officially approved for the country, and yet it’s there -- despite the fact that China has blocked thousands of websites ranging from Facebook, Google to Twitch, Steam somehow remains accessible. But Steam hasn’t been immune to China’s censorship, either. Chinese regulators have blocked Steam’s community feature and applied pressure on Valve to ensure the storefront is as compliant as it can be. Now gamers worry that the official version of Steam China -- which will presumably contain a much more limited subset of games, the ones that are approved for sale in China -- will mean that the government will shut off access to the global version. Not helping the tension -- the Chinese government’s moves to tighten its grip on gaming. It’s planning tough new regulations to curb video game addiction and myopia. And it has not approved any new games since March. Since new games can’t be published through other legitimate channels, more and more gamers and game publishers alike inside China turn to the global version of Steam. The biggest example? PUBG. The game quickly became a viral sensation around the world, but wasn’t officially available in China -- so Chinese gamers flocked to Steam, buying 15 million copies. PlayerUnknown's Battlegrounds is a "battle royale" shooting game. It's a little like the Hunger Games: 100 players have to scavenge for weapons and kill everyone else to be the last player standing. The surprising success of The Scroll of Taiwu is another case in point. The small-budget indie game, only available in Chinese, ranked among Steam’s top-sellers for weeks. Shocked by their own success, the developers said that they chose to publish the title on Steam given China’s approval freeze. A developer said, “My team has an urgent need to survive.” Within three hours following the announcement of Steam China, posts linked to its related hashtag have been read over 5 million times on Weibo. Weibo is a Twitter-like microblogging service used by hundreds of millions of users. Launched by Sina in 2009, it regularly censors topics deemed sensitive or inappropriate by the Chinese government. Many netizens say that they are bleeding green blood following the news. Why green blood? Because blood and violence is censored in Chinese games, the color of blood in video games in China is often changed to green. A Weibo user sardonically wrote, “Pow! And I spit out a mouthful of green blood. Source
  9. Xi Jinping and Donald Trump discussed a range of issues — among them the trade dispute that has left over $200 billion worth of goods hanging in the balance. "President Trump has agreed that on January 1, 2019, he will leave the tariffs on $200 billion worth of product at the 10 percent rate, and not raise it to 25 percent at this time," the White House said. Chinese President Xi Jinping and U.S. President Donald Trump put their bilateral trade war on pause momentarily, striking an agreement to hold off on slapping additional tariffs on each other's goods after January 1, as talks continue between both countries. In a White House readout of a dinner at the G-20 summit in Argentina, Xi and Trump discussed a range of nettlesome issues — among them the trade dispute that has left over $200 billion worth of goods hanging in the balance. "President Trump has agreed that on January 1, 2019, he will leave the tariffs on $200 billion worth of product at the 10 percent rate, and not raise it to 25 percent at this time," the statement read. Over the next 90 days, American and Chinese officials will continue to negotiate lingering disagreements on technology transfer, intellectual property and agriculture. "Both parties agree that they will endeavor to have this transaction completed within the next 90 days. If at the end of this period of time, the parties are unable to reach an agreement, the 10 percent tariffs will be raised to 25 percent," the statement added. Meanwhile, "China will agree to purchase a not yet agreed upon, but very substantial, amount of agricultural, energy, industrial, and other product from the United States to reduce the trade imbalance between our two countries. China has agreed to start purchasing agricultural product from our farmers immediately," the White House said. Xi also plans to designate Fentanyl as a controlled substance, according to the statement. As the U.S. opioid crisis continues to rage, it would suggest that people selling the drug to parties in the U.S. would be subject to stiff penalties in China. The Trump administration had threatened to more than double the tariffs it has already slapped on $250 billion worth of Chinese imports, while Xi's government has put targeted tariffs on $110 billion in U.S. goods. The standoff has raised fears among investors and businesses that the global economy could be dragged down by the dispute between the world's two largest economies. Trump, who made U.S. trade policy a central plank of his platform as a presidential candidate in 2016, wants to address specific gripes with China's trade practices, especially its alleged theft of U.S. intellectual property. Trump touted the G-20 meeting thus far as a "great success" in a pair of tweets Saturday. But he postponed a press conference, which was scheduled to follow a summit meeting, until after the funeral of former President George H.W. Bush, who died at age 94 on Friday. In a joint declaration, the group of nations said the current multilateral trading system is "falling short of its objectives and there is room for improvement," and supported reforms to the World Trade Organization. Source
  10. The secrecy surrounding the work was unheard of at Google. It was not unusual for planned new products to be closely guarded ahead of launch. But this time was different. The objective, code-named Dragonfly, was to build a search engine for China that would censor broad categories of information about human rights, democracy, and peaceful protest. In February 2017, during one of the first group meetings about Dragonfly at Google’s Mountain View headquarters in California, some of those present were left stunned by what they heard. Senior executives disclosed that the search system’s infrastructure would be reliant upon a Chinese partner company with data centers likely in Beijing or Shanghai. Locating core parts of the search system on the Chinese mainland meant that people’s search records would be easily accessible to China’s authoritarian government, which has broad surveillance powers that it routinely deploys to target activists, journalists, and political opponents. Yonatan Zunger, then a 14-year veteran of Google and one of the leading engineers at the company, was among a small group who had been asked to work on Dragonfly. He was present at some of the early meetings and said he pointed out to executives managing the project that Chinese people could be at risk of interrogation or detention if they were found to have used Google to seek out information banned by the government. Scott Beaumont, Google’s head of operations in China and one of the key architects of Dragonfly, did not view Zunger’s concerns as significant enough to merit a change of course, according to four people who worked on the project. Beaumont and other executives then shut out members of the company’s security and privacy team from key meetings about the search engine, the four people said, and tried to sideline a privacy review of the plan that sought to address potential human rights abuses. Zunger — who left his position at Google last year — is one of the four people who spoke to The Intercept for this story. He is the first person with direct involvement in Dragonfly to go on the record about the project. The other three who spoke to The Intercept are still employed by Google and agreed to share information on the condition of anonymity because they were not authorized to talk to the media. Their accounts provide extraordinary insight into how Google bosses worked to suppress employee criticism of the censored search engine and reveal deep fractures inside the company over the China plan dating back almost two years. Google’s leadership considered Dragonfly so sensitive that they would often communicate only verbally about it and would not take written notes during high-level meetings to reduce the paper trail, two sources said. Only a few hundred of Google’s 88,000 workforce were briefed about the censorship plan. Some engineers and other staff who were informed about the project were told that they risked losing their jobs if they dared to discuss it with colleagues who were themselves not working on Dragonfly. “They [leadership] were determined to prevent leaks about Dragonfly from spreading through the company,” said a current Google employee with knowledge of the project. “Their biggest fear was that internal opposition would slow our operations.” In 2016, a handful of Google executives — including CEO Sundar Pichai and former search chief John Giannandrea — began discussing a blueprint for the censored search engine. But it was not until early 2017 that engineers were brought on board to begin developing a prototype of the platform. The search engine was designed to comply with the strict censorship regime imposed by China’s ruling Communist Party, blacklisting thousands of words and phrases, including terms such as “human rights,” “student protest,” and “Nobel Prize.” It was developed as an app for Android and iOS devices, and would link people’s search records to their personal cellphone number and track their location. (Giannandrea could not be reached for comment.) The company managed to keep the plan secret for more than 18 months — until The Intercept disclosed it in August. Subsequently, a coalition of 14 leading human rights groups, including Amnesty International and Human Rights Watch, condemned the censored search engine, which they said could result in Google “directly contributing to, or [becoming] complicit in, human rights violations.” Employees who opposed the censorship staged protests inside the company. Meanwhile, a bipartisan group of U.S. senators called Dragonfly “deeply troubling,” and Vice President Mike Pence demanded that Google “immediately end” its development. Google employees who had worked on Dragonfly watched the furor unfold and were not surprised by the backlash. Many of the concerns raised by the human rights groups, they noted, had already been voiced inside the company prior to the public exposure of the plans, though they had been brushed aside by management. Every new product or service that Google develops must be reviewed by legal, privacy, and security teams, who try to identify any potential issues or problems ahead of the launch. But with Dragonfly, the normal procedure was not followed: Company executives appeared intent on watering down the privacy review, according to the four people who worked on the project. In January 2017, Zunger, the 14-year veteran engineer at the company, had been tasked with producing the privacy review. However, it quickly became apparent to him that his job was not going to be easy. His work was opposed from the outset by Beaumont, Google’s top executive for China and Korea. Beaumont, a British citizen, began his career in 1994 as an analyst for an investment bank in England and later founded his own company called Refresh Mobile, which developed apps for smartphones. He joined Google in 2009, working from London as director of the company’s partnerships in Europe, Asia and the Middle East. In 2013, Beaumont relocated to China to head Google’s operations there. He described himself in his LinkedIn biography as a “technology optimist” who cares about “the value and responsible use of technology in a range of fields.” According to Zunger, Beaumont “wanted the privacy review [of Dragonfly] to be pro forma and thought it should defer entirely to his views of what the product ought to be. He did not feel that the security, privacy, and legal teams should be able to question his product decisions, and maintained an openly adversarial relationship with them — quite outside the Google norm.” Three sources independently corroborated Zunger’s account. Beaumont did not respond to multiple requests for comment, and Google declined to answer questions for this story. During one meeting, Zunger recalled, Beaumont was briefed on aspects of Dragonfly that Google’s privacy and security teams planned to assess. He was told that the teams wanted to check whether the Chinese search system would be secure against state and non-state hackers, whether users in China would have control over their own data, and whether there may have been any aspects of the system that might cause users to unintentionally disclose information about themselves. “I don’t know if I want you asking those questions,” Beaumont retorted, according to Zunger, who said the comment was “quite surprising to those in the room.” Beaumont micromanaged the project and ensured that discussions about Dragonfly and access to documents about it were tightly controlled. “Different teams on the Dragonfly project were actively segmented off from one another and discouraged from communicating, except via Scott’s own team, even about technical issues,” said Zunger. This was “highly unusual,” according to Zunger. Normally, even for extremely confidential work inside the company, he said, there would be “open and regular communication within a project, all the way up to senior leadership.” With Dragonfly, the opposite was true. The restrictions around the project limited the ability for discussion and seemed intended “to prevent internal objections,” Zunger said. Some members of the Dragonfly team were told that if they broke the strict confidentiality rules, then their contracts at Google would be terminated, according to three sources. Despite facing resistance, the privacy and security teams — which together included a total of between six and eight people — proceeded with their work. Zunger and his colleagues produced a privacy report that highlighted problematic scenarios that could arise once the censored search engine launched in China. The report, which contained more than a dozen pages, concluded that Google would be expected to function in China as part of the ruling Communist Party’s authoritarian system of policing and surveillance. It added that, unlike in Europe or North America, in China it would be difficult, if not impossible, for Google to legally push back against government requests, refuse to build systems specifically for surveillance, or even notify people of how their data may be used. Zunger had planned to share the privacy report and discuss its findings during a meeting with the company’s senior leadership, including CEO Sundar Pichai. But the meeting was repeatedly postponed. When the meeting did finally take place, in late June 2017, Zunger and members of Google’s security team were not notified, so they missed it and did not attend. Zunger felt that this was a deliberate attempt to exclude them. By this point, Zunger had already decided to leave Google, due to a job offer he had received from Humu, a startup company co-founded by Laszlo Bock, Google’s former head of human resources, and Wayne Crosby, Google’s former director of engineering. Had Zunger not received the offer to join Humu when he did, he said, he would likely have ended up resigning in protest from Google over Dragonfly. “The project, as it was then specified, was not something I could sign off on in good conscience,” he told The Intercept. Zunger does not know what happened to the privacy report after he left Google. He said Google still has time to address the problems he and his colleagues identified, and he hopes that the company will “end up with a Project Dragonfly that does something genuinely positive and valuable for the ordinary people of China.” Google launched a censored search engine in China in 2006 but stopped operating the service in the country in 2010, saying it could no longer tolerate Chinese government efforts to limit free speech, block websites, and hack activists’ Gmail accounts. At that time, Google co-founder Sergey Brin had advocated inside the company to pull out of China because he was uncomfortable with the level of government censorship and surveillance. The “key issue,” Brin said, was to show that Google was “opposing censorship and speaking out for the freedom of political dissent.” The Dragonfly revelations prompted questions about whether Brin had dramatically reversed his views on censorship in China. But in a meeting with Google employees in August, Brin claimed that he knew nothing about Dragonfly until The Intercept exposed it. According to three sources, employees working on Dragonfly were told by Beaumont, the company’s China chief, that Brin had met with senior Chinese government officials and had told them of his desire to re-enter the Chinese market, obeying local laws as necessary. However, the Dragonfly teams were instructed that they were not permitted to discuss the issue directly with Brin or other members of Google’s senior leadership team, including Pichai, co-founder Larry Page, and legal chief Kent Walker. Two sources working on Dragonfly believed that Beaumont may have misrepresented Brin’s position in an attempt to reassure the employees working on Dragonfly that the effort was fully supported at the highest levels of the company, when that may not have been the truth. “How much did Sergey know? I am guessing very little,” said one source, “because I think Scott [Beaumont] went to great lengths to ensure that was the case.” Inside Google, a deep ideological divide has developed over Dragonfly. On one side are those who view themselves as aligned with Google’s founding values, advocating internet freedom, openness, and democracy. On the other side are those who believe that the company should prioritize growth of the business and expansion into new markets, even if doing so means making compromises on issues like internet censorship and surveillance. Pichai, who became Google’s CEO in 2015, has made it clear where he stands. He has strongly backed Dragonfly and spoken of his desire for the company to return to China and serve the country’s people. In October, Pichai publicly defended the plan for the censored search engine for the first time, though he tried to play down the significance of the project, portraying it as an “experiment” and adding that it remained unclear whether the company “would or could” eventually launch it in China. Staff working on Dragonfly were confused by Pichai’s comments. They had been told to prepare the search engine for launch between January and April 2019, or sooner. The main barrier to launch, the employees were told, was the ongoing U.S. trade war with China, which had slowed down negotiations with government officials in Beijing, whose approval Google required to roll out the platform in the country. “What Pichai said [about Dragonfly being an experiment] was ultimately horse shit,” said one Google source with knowledge of the project. “This was run with 100 percent intention of launch from day one. He was just trying to walk back a delicate political situation.” The launch plan was outlined during a July meeting for employees who were working on Dragonfly. The company’s search chief, Ben Gomes, instructed engineers to get the search engine ready to be “brought off the shelf and quickly deployed.” Beaumont told employees in the same meeting that he was pleased with how things were developing for the company in the country, according to a previously undisclosed transcript of his comments obtained by The Intercept. “There has been a really positive change in tone towards Google during [Pichai’s] recent visits” to China, Beaumont said. “Part of our task over the past few years has been to re-establish that Google can be a trusted operator in China. And we’ve really seen a pleasing turnaround, relatively recently in the last couple of years. We are fairly confident that, outside of the trade discussions, there is a positive consensus across government entities to allow Google to re-engage in China.” A few weeks later, details about Dragonfly were emblazoned across international newspapers and the internet, and the company was scrambling to contain the outpouring of internal and external protest. Beaumont was furious that information about the project had leaked, said two sources familiar with his thinking, and he told colleagues that he feared the disclosures may have scuppered the prospect of Google launching the platform in the short term. “[Beaumont’s] endgame was very simple — his ideal circumstance was that most people would find out about this project the day it launched,” said one Google source. “He wanted to make sure there would be no opportunity for any internal or external resistance to Dragonfly, but he failed.” Source
  11. Hope that free lunch was delicious WHEN JANET JACKSON and Luther Vandross sang that "the best things in life are free", they probably didn't have VPN apps in mind, given the year was 1992 and the song was recorded for a 5.5-rated crime comedy caper. Just as well, because if you currently do get your VPN fix free of charge, it's worth considering what the payoff might involve. As the old adage says: if you're not paying for the product, you are the product. According to a new investigation from Metric Labs - the company behind Top10VPN - the majority of the top-ranking free VPN apps on Google Play and the Apple App Store are either based in China, or have some kind of Chinese ownership. If that doesn't immediately raise a flag as red as China's, this is why it should: the Chinese government has been clamping down on VPN software in recent years, and any private data funnelled through them may well not remain private for long. In all, 17 out of the 30 apps analysed had links to China, and 86 per cent had huge privacy issues to boot. Some simply provided no information about whether data was logged or shared with third parties, while others used generic privacy policies with no relevance to VPNs. Others had no policy at all, but several explicitly revealed sharing information with China. If these weren't alarming enough, the professionalism of the outfits should also be called into question. 64 per cent didn't have a dedicated website, with several having no online presence at all. 55 cent of those that bothered with a privacy policy stuck them on a WordPress site with ads, or whacked them straight into a file on PasteBin. And 52 per cent of support email addresses used free, personal domains like Gmail, Yahoo or Hotmail. Oh, and 83 per cent ignored emails sent to them. While none of these things are proof of dubious practices, it should at least give you pause for thought. If you care enough about privacy to download a VPN, maybe pay the people you're relying on protecting it in future? Source
  12. Employees are asking management to end the project, citing human rights concerns. Google workers signed a public letter asking their company’s management to cancel controversial plans to build a censored version of the company’s search product in China, referred to as Project Dragonfly. “Our opposition to Dragonfly is not about China: we object to technologies that aid the powerful in oppressing the vulnerable, wherever they may be,” the letter reads. It goes on to state that the project “comes as the Chinese government is openly expanding its surveillance powers and tools of population control” and “would establish a dangerous precedent, at a volatile political moment.” The letter is in support of Amnesty International’s public campaign against the project, which includes planned protests outside several Google offices today. About nine workers have signed the letter so far, including two of the organizers of the recent Google Walkout protests. This isn’t the first time Google employees have taken issue with Google’s ambitions to build a censored search app for China. But it’s the first time employees have publicly called for it to end. In August, around 1,400 employees signed a letter internally raising ethical concerns about the project. The app was reportedly designed to blacklist phrases such as “human rights,” “Nobel Prize,” and “student protest,” according to the Intercept, which first reported on its existence. Several employees including a senior research scientist resigned over the issue. There has also been increasing pressure to end the project from U.S. politicians. Six senators have asked for more information about the project and Vice President Mike Pence publicly criticized the project, saying that it “will strengthen Communist Party censorship and compromise the privacy of Chinese customers” and called on Google to halt development. Google CEO Sundar Pichai has defended the company’s decision to enter the Chinese market, arguing that the company is always balancing its values when abiding by local laws in other countries. “We are compelled by our mission [to] provide information to everyone, and [China is] 20 percent of the world’s population.” said Pichai speaking at the WIRED25 conference last month. Google previously cancelled plans to expand its business to China in 2010 over concerns about the government’s involvement in cyber attacks and regulations on citizens’ free speech. In the past year, Google employees have become increasingly outspoken about ethical implications of how the company’s technology is used. In April, thousands of employees criticized the company’s involvement in a project with the Pentagon to use Google artificial intelligence technology for military purposes. Two months later, the company decided not to renew that contract. Source
  13. The Chinese are making doubly sure public displays of displeasure with their totalitarian regime such as occurred in Tiananmen Square in 1989 will never be repeated. They are instituting a technological surveillance program so pervasive that when completed -- quite soon, it seems -- it will enforce conformity throughout their giant country on a scale that would stupefy Orwell and Huxley. China’s plan to judge each of its 1.3 billion people based on their social behavior is moving a step closer to reality, with Beijing set to adopt a lifelong points program by 2021 that assigns personalized ratings for each resident. The capital city will pool data from several departments to reward and punish some 22 million citizens based on their actions and reputations by the end of 2020, according to a plan posted on the Beijing municipal government’s website on Monday. Those with better so-called social credit will get “green channel” benefits while those who violate laws will find life more difficult. The Beijing project will improve blacklist systems so that those deemed untrustworthy will be “unable to move even a single step,” according to the government’s plan. Bloomberg has more to say about this incipient "brave new world." The final version of China’s national social credit system remains uncertain. But as rules forcing social networks and internet providers to remove anonymity get increasingly enforced and facial recognition systems become more popular with policing bodies, authorities are likely to find everyone from internet dissenters to train-fare skippers easier to catch -- and punish -- than ever before. Bad news for Winston Smith. Or is it Winston Chang? Thank God, it's China! Or is it? Perhaps the Chinese are only being public, and therefore somewhat more honest and transparent, about their plans and the world in which we all already live. After all, when it comes to technological surveillance, they are merely playing catch-up to our NSA, which has been monitoring us all for decades with only sporadic protest. Does the NSA have their own form of a rating system? We don't know, but they surely have some way -- various algorithms, one assumes -- for deciding who deserves more attention. Meanwhile, Google -- lord on high of the internet -- works with the NSA through the PRISM program and with the Chinese on a new China-only search engine that will be subject to Communist Party regulation, an equal opportunity silicon behemoth. Google's experience with NSA makes this outreach to the Chinese almost seamless. When you think about it, the similarity of approach and method is blood-curdling. It wouldn't be surprising if important components of the new surveillance technology for this latest Chinese initiative to control the behavior of their entire population were "borrowed" in part from Google. What does this all mean to us -- the common man and woman of the USA (and elsewhere really)? Whether we choose to think about it or not, almost all of us realize we have no private life any more, no secrets the government couldn't easily ascertain should it be the slightest bit interested. Even a presidential candidate was not exempt from such surveillance. What possibility do we have? This has already been factored into our personalities and behaviors, at the very least unconsciously, in ways we can only begin to guess as it is now such a mundane occurrence. I would imagine many phenomena such as political correctness and its attendant virtue signaling are amplified by the knowledge that we are constantly observed. It also contributes to the extraordinary uniformity and group think pervading our educational system and media. The employees of Google themselves behave much like a cult, eager to drum out the mildest of apostates. The self-styled social justice warriors on our campuses act similarly, ever searching for the most "victimized" person as the eye in the sky watches and, hopefully, approves. All the to-ing and fro-ing on our supposedly contentious social media are just fodder for the homogenization to come. It's all very Chinese, if you think not very far back to the Cultural Revolution. But Mao and Jiang Qing didn't have the technological weapons available today and were beaten back, temporarily anyway. Now the battle for freedom is global. Source
  14. Alphabet Chairman John Hennessy is conflicted about what Google's strategy should be in China. John Hennessy "Anybody who does business in China compromises some of their core values," Hennessy said in an interview this week with Bloomberg. It's true for every company "because the laws in China are quite a bit different than they are in our own country," he said. Since details of Google's project to create a censored search app for the Chinese market leaked this summer, human rights groups and U.S. politicians have called on the company to cancel its plans, while thousands of Google employees signed a letter saying that it raised "urgent moral and ethical issues." The company initially withdrew its search service from the country in 2010 due to increased concerns about cyberattacks and censorship. In the time since, the Chinese government has increasingly curtailed what its citizens can or and can't do online by blacklisting websites and access to information about certain historical events — like the 1989 protests at Tiananmen Square — and requiring people who use online forums to register with their real names. Google's Chinese search app would have reportedly complied with demands to remove content that the government ruled sensitive and linked users' searches to their personal phone numbers. Critics say that by cooperating with the Chinese government, Google would have violated principles of free expression as well as users' privacy rights. Hennessy, like Google CEO Sundar Pichai,framed the company's consideration of a censored search product through the lens of it being a better option than current domestic products, like the local search engine Baidu. "The question that I think comes to my mind then, that I struggle with, is are we better off giving Chinese citizens a decent search engine, a capable search engine even if it is restricted and censored in some cases, than a search engine that's not very good?" Hennessy said. "And does that improve the quality of their lives?" Hennessy, a former president of Stanford University, said that he didn't have a good answer. There's no doubt it's a big market. As of August, China had 800 million internet users. Pichai has repeatedly said that Google's plans for a censored search app in China are in their "early stages," and recently equated them with how the company must follow "right-to-be-forgotten laws" in Europe. Critics called it a false comparison. Pichai has also said that in any country where Google operates, it must balance its values — "providing users access to information, freedom of expression and user privacy" — with obeying the local laws. Other major U.S. technology companies like Facebook and Netflix are also banned in China, though Apple sells hundreds of millions of phones there and has more than 40 physical retail stores. Source
  15. Former FBI director Louis Freeh says launching cyber attacks back at China is the only way to stop it hacking commercial secrets Targeted cyber attacks and a strong deterrence capability are the most effective way of preventing China and other countries continuing to steal Australian commercial secrets, according to a former director of the Federal Bureau of Investigation. Louis Freeh, who ran the FBI for almost eight years until 2001, said the threat of criminal charges or jail time would do little to prevent state-sponsored hackers from continuing to steal valuable intellectual property. "It's like trying to serve a subpoena on [Osama] Bin Laden – it's not very effective," Mr Freeh said on the sidelines of a speech in Sydney on Monday night. His comments come as the federal government considers how best to respond to a surge in cyber attacks directed by China's peak security agency over the past year. An investigation by The Australian Financial Review and Nine News confirmed China's Ministry of State Security (MSS), was responsible for the recent wave of attacks on Australian companies. These formed part of what is known in cyber circles as "Operation Cloud Hopper", which was detected by Australia and its partners in the Five Eyes intelligence sharing alliance. The attacks on Australian companies are in breach of an agreement struck between Premier Li Keqiang and former prime minister Malcolm Turnbull in April 2017 to not steal each other's commercial secrets. Filing criminal charges against Chinese hackers, as the US has done over the past year, is one option open to Australia, although Mr Freeh believes a formidable cyber deterrence capability is the best defence. Mr Freeh likened offensive cyber capabilities to the doctrine of mutually assured destruction during the Cold War, which he said ultimately prevented nuclear weapons being used. "All the major powers, including Australia, they know the [cyber] capacity of their adversaries," he said. "They can assess pretty accurately the capacity of their adversaries and allies and that is the single most reason why we have not seen a cyber war …. it's the same reason nobody has fired a nuclear weapon in 75 years." Mr Freeh said countries had the capability to shut down power grids, transport networks and financial systems, but had not done so as it would potentially trigger a far larger retaliatory attack. He said offensive cyber capabilities had been used after attacks in the past, but the response was proportionate. "We've seen enough attacks that have given countries the basis to retaliate and they have in many cases, but the retaliation, if you look at it from 30,000 feet, is very proportionate and very measured given the initial attack." Malcolm Turnbull acknowledged Canberra's offensive cyber capabilities in April 2016, but few other countries have followed this lead. Since that announcement the government said the capability has been used against Islamic State in the Middle East, while also revealing it has established an information warfare division with the Australian Defence Force. "Governments routinely engage in a wide spectrum of cyber operations, and researchers have identified more than 100 states with military and intelligence cyber units," Fergus Hanson and Tom Uren said in a report for the Australian Strategic Policy Institute. Source
  16. Intelligence official says Chinese economic espionage on the upswing Rob Joyce speaks during the 2018 Aspen Cyber Summit in San Francisco on Thursday. SAN FRANCISCO — China has violated an accord it signed with the U.S. three years ago pledging not to engage in hacking for the purpose of economic espionage, a senior U.S. intelligence official said Thursday. The 2015 bilateral agreement had significantly reduced the amount of Chinese cybertheft targeting American companies, but Beijing’s commitment to the deal has eroded, said Rob Joyce, senior adviser for cybersecurity strategy at the National Security Agency. “It is clear they are well beyond the bounds of the agreement today that was forged between our two countries,” Joyce said during a panel conversation at the Aspen Cyber Summit. Joyce’s comments were the latest sign of Washington’s rising frustration over China’s alleged violation of the pact signed between then-President Barack Obama and Chinese President Xi Jinping. Last week, then-Attorney General Jeff Sessions also said China wasn’t adhering to the deal, in which the U.S. and China agreed not to conduct cyber operations against each other to steal intellectual property or other forms of economic intelligence. Source
  17. In a New York Times interview, Google CEO Sundar Pichai said when the company follow's Europe's "right to be forgotten" laws, "we are censoring search results because we're complying with the law." Google faced internal and public backlash earlier this year when the Intercept reported the company was working on a censored version of its search engine in China. Europe's "right to be forgotten" laws generally focus on the right to request a company delete personal data in some circumstances, while the Chinese government is known to censor factual historical information. Google CEO Sundar Pichai offered a new justification for the company's exploration of a censored version of its search engine for people in China: it already censors information elsewhere. In a New York Times interview published Thursday, Pichai compared Europe's "right to be forgotten laws" to censorship when asked about launching a search product in China. "One of the things that's not well understood, I think, is that we operate in many countries where there is censorship. When we follow 'right to be forgotten' laws, we are censoring search results because we're complying with the law," Pichai told the Times. Google has been grappling with how it could reach China's 800 million Internet users since it withdrew its service in 2010 amid censorship and security concerns. Earlier this year, Google faced backlash both internally and from the public when the Intercept reported its apparent plans to build a censored version of its search engine in China. Europe's "right to be forgotten" laws are distinct in important ways from censorship of information by the Chinese government. While "right to be forgotten" laws mainly center on the right of individuals to request personal data be deleted from the internet or search results, the Chinese government has been found to suppress factual information that would not be subject to the "right to be forgotten" laws. Through tight control over its media and internet access, China has created the "Great Firewall" that prevents people living there from accessing certain websites or searching some historical events , like the protests at Tiananmen Square in 1989. The "right to be forgotten" came from a 2014 case decided against Google by the European Court of Justice. The case centered around a Spanish man who wanted Google to remove an old newspaper article about a real estate auction the government ordered to recover his social security debts. The court decided that Google had to remove the article from its index even though the newspaper could keep it on its site. Now, the "right to be forgotten" is codified in the European Union's General Data Protection Regulation (GDPR), which went into effect earlier this year. Under this part of the regulation, EU citizens have the right to request that internet businesses delete certain personal data under some circumstances . Pichai told the Times he's not convinced a move into China is a top priority. "I'm committed to serving users in China," he said. "Whatever form it takes, I actually don't know the answer. It's not even clear to me that search in China is the product we need to do today." A Google spokesperson did not respond to a request for comment. Source
  18. Despite being banned in 2010, about 40,000 tons of carbon tetrachloride, an ozone-depleting compound, are still emitted into the atmosphere every year. But the origins of the illegal emissions have long baffled scientists. Now, an international team of researchers has tracked down the source of nearly half of the emissions to eastern China, according to a recent study published in the journal Geophysical Research Letters. About 40,000 tons of the banned ozone-depleting compound carbon tetrachloride are still emitted every year. Scientists at the University of Bristol in the UK — working alongside collaborators in South Korea, Switzerland, Australia, and the United States — plugged ground-based and airborne emissions data from near the Korean peninsula into two models that simulate the movement of gases through the atmosphere. They found ongoing emissions of carbon tetrachloride from industrialized areas in eastern China that account for half the global total from 2009 to 2016. They also found evidence of a possible new source of emissions in China’s Shandong province after 2012. The scientists stressed that they do not know whether carbon tetrachloride is being produced intentionally or as an industrial byproduct, such as during the production of chemicals like chlorine. Before being banned, carbon tetrachloride was used in the dry-cleaning industry, in fire extinguishers, and as a refrigerant. The researchers said that follow-up studies are needed to determine what industries or industrial processes are producing the banned compound. “There is a temptation to see ozone depletion as a problem that has been solved,” Mark Lunt, an atmospheric scientist at the University of Bristol and lead author of the new study, said in a statement. “But the monitoring of man-made ozone-depleting gases in the atmosphere is essential to ensure the continued success of the phase-out of these compounds.” Source
  19. The trade war is starting to hurt the Asian nation, depressing the consumer spending that the Alibaba relies on to drive much of its growth. Alibaba trimmed its annual forecast after quarterly sales missed estimates, underscoring the extent to which escalating tensions with the US are hurting the Chinese economy. For the fiscal year ending March, the company is now predicting revenue of 375 billion yuan ($54.5 billion) to 383 billion yuan, equating to growth of as much as 53% versus the 60% it guided towards previously. Second-quarter sales came in 1.6% below analysts’ estimates. While the US and China appear willing to discuss a deal of some sort, Alibaba co-founder Jack Ma has warned of longer-term conflict between the world’s two largest economies. The trade war is starting to hurt the Asian nation, depressing the consumer spending that the online giant relies on to drive much of its growth. Domestically, it’s grappling with a migration of smaller merchants to cheaper platforms such as JD.com and Pinduoduo, both backed by nemesis Tencent. “China’s e-commerce sector will feel the drag of the economy slowdown even more next year,” said Steven Zhu, an analyst with Pacific Epoch. “Platforms like Pinduoduo are charging much lower in commissions, posing significant competition to Alibaba.” Heightening the uncertainty, Chinese regulators are clamping down on the country’s internet sector, reining in everything from gaming apps and travel sites to ride-hailing. That’s exacerbating already slowing growth in Alibaba’s business. The Hangzhou-based company is trying to counter that by stepping up its marketing services and investing in its own grocery stores and delivery to boost sales. Alibaba’s closely watched customer management revenue, which includes the high-margin business of helping merchants with marketing, grew 25%– down a tad from the previous quarter’s 26%. Other divisions however remained humming — the cloud business grew 90%. Youku, its Netflix-style video service, more than doubled its average daily subscribers, while the international business — a relatively smaller piece of the pie — grew 55%. Revenue at China’s biggest e-commerce company rose 54% to 85.15 billion yuan in the three months ended September. That compares with the 86.5 billion-yuan average of estimates compiled by Bloomberg. Adjusted earnings-per-share came to 9.60 yuan, compared with estimates for 7.43 yuan. Shares of Alibaba gained 2.6 percent in pre-market trade, as stocks surged amid hopes China and the U.S. might have possible terms of a trade deal to discuss this month. Its shares have slid 12.3 percent this year compared with a 3.5 percent loss for the NYSE Composite Index. The reduced forecast comes as Alibaba ramps up for its annual Singles’ Day shopping festival, a litmus test of not just the company’s health but also China’s overall consumption. Chinese online retail sales growth is already slowing, to 24% in the third quarter from 36% in the second. Chief Executive Officer Daniel Zhang, who succeeds Ma as chairman next year, will preside over the November 11 event as it broadens the shopping categories to include purchases made in affiliated shopping malls and food deliveries. Alibaba faces “a soft quarter ahead on weak consumption and intensifying competition,” Wendy Huang, an analyst at Macquarie, said in a report. Source
  20. The materials have no proven medicinal value in humans, and conservationists call the move a major setback for wild populations. Using rhino horn and tiger bone for traditional Chinese medicine imperils these endangered creatures, experts say. In China, rhino horn and tiger bone may now be legally used in medical research or traditional medicine following a controversial announcement by the government this morning. The animal specimens may be obtained only from farms, according to the announcement, but conservationists say this surprising move may open the floodgates for a surge in illegal activity and threaten vulnerable animal populations. The move is “very concerning,” says Leigh Henry, director of wildlife policy at the World Wildlife Fund. Discerning what animals were obtained legally from farms rather than illegally from the wild would be incredibly difficult, so this decision would give cover to traffickers, she says. Rhinos and tigers are both endangered in the wild, and their trade is prohibited. “WWF urgently calls on China to maintain the ban on tiger bone and rhino horn trade which has been so critical in conserving these iconic species. This should be expanded to cover trade in all tiger parts and products,” she says. China’s action stands in sharp contrast to the country’s moves to combat poaching in recent years. The country has had a 25-year-old ban in place preventing the import or export of these products. And the World Federation of Chinese Medicine Societies—the official group that dictates what can be used in traditional medicine—also removed rhino horn and tiger bone from its list of products approved for use on patients (though the market still existed for them). Two years ago, China also announced that it would close its domestic ivory market by the end of 2017, earning widespread praise. Conservation groups championed the move as a necessary step to help reduce ivory demand and tamp down poaching of African elephants. Debbie Banks, Tiger Campaign Leader at the Environmental Investigation Agency, a nonprofit with offices in London and Washington, D.C., says that today’s announcement undermines China’s stance on wildlife protection. “China’s reputation as a leader in conservation following their domestic ban on the sale of ivory now lies in tatters,” she said in an email. “The news today,” she says, “seriously jeopardizes the future survival of wild tigers by stimulating demand for their body parts instead of eradicating demand,” adding that it also puts rhinos at risk in their African and Asian range countries. “The news today is a staggering display of brazen disregard for global opinion.” The reason China took this step remains unclear. Chinese officials did not immediately respond to requests for comment. But the growing number of tiger farms in China and efforts to farm rhinos there may be a key driver, environmental groups say. “We’ve been concerned for a long time about the tiger farms in China and the increasing numbers of farms there,” Henry says. “Captive tigers are incredibly expensive to feed and care for, so as these numbers grew, so did pressure on the Chinese government to allow a regulated trade in tiger products. China's decision is what many of us have feared for over a decade.” The Environmental Investigation Agency had reported in 2013 that at least several thousand tigers were being kept at hundreds of farms across the country. Moreover, China also has reportedly started importing rhinos for potential farming. Susan Lieberman, vice president for international policy at the Wildlife Conservation Society, a New York-based nonprofit working on global conservation, also believes that the growing number of farmed tigers may be a major factor behind China’s decision. The new legality of tiger bone and rhino horn use, she says, will be a major win for traffickers. “You would want there to be a legal market to hide behind,” she says. Without DNA tests of these products, there’s no way to know if their source is a farm or the wild. Rhino horn is made from keratin—a protein found in fingernails and hair—and the product is falsely said to help treat everything from cancer to gout when consumed in its powder form. There are no proven medicinal benefits in humans from either product. The most sparing evidence has been brought to bear claiming that rhino horn may somehow help lower fever, at least in rodents. Certainly, cheaper, more readily available medicines such as acetaminophen or aspirin are far more effective, Lieberman says. Tiger bone crushed and made into a paste has been said to be usable to treat a variety of ailments, including rheumatism and back pain. But Lieberman says, “I know of no evidence for that.” Source
  21. How lax regulation made it cheaper for China to outsource pork production – and all of its environmental and human costs – to the U.S. In July 2013, Larry Pope, the CEO of Smithfield Foods, the largest pork producer in America, was called to testify before a U.S. Senate committee about the pending sale of his company to a Chinese conglomerate now known as WH Group. The $7.1 billion purchase, the largest-ever foreign takeover of its kind, had attracted concerns. The Chinese pork manufacturer had a checkered health record, allegedly feeding its hogs illegal chemicals, and Smithfield had a long history of environmental problems at its farms, including a $12 million fine for several thousand clean-water violations. But the worries did not stop there. The Chinese government had a track record of using nominally private entities as proxies for state power. “To have a Chinese food company controlling a major U.S. meat supplier, without shareholder accountability, is a bit concerning,” said Republican Sen. Chuck Grassley. “A safe and sustainable food supply is critical to national security. How might this deal impact our national security?” In a measured Southern drawl, Pope explained that the deal was a win for everyone. Pork markets were declining in America, while China had become the largest pork consumer in the world. The takeover would create jobs in rural America by opening a vast market. When senators pressed Pope about whether the takeover was being directed by the Chinese government, the executive laughed it off. He promised both companies would respect the health of the communities and the environment surrounding hog farms. A few months later, the deal was approved. Questions soon emerged about the transaction. China’s national economy is directed by Five-Year Plans, economic blueprints handed down by the government that private companies are expected to follow. In 2011, as the nation’s billion-plus citizens continued to forge a stable middle class of pork consumers, the government issued a plan directing Chinese companies to buy foreign food producers and farmland. In two years, Chinese nationals went from owning $81 million worth of American farmland to nearly $1.4 billion, including the Smithfield purchase. Despite Pope’s denials of Chinese-government involvement, the nation’s central bank had approved a $4 billion cash loan to fund the acquisition, a transaction its 2013 annual report described as a “social responsibility.” The investigative news organization Reveal uncovered documents showing that WH Group receives guidance from the government, which a company executive explained was because “pork is considered a national-security issue in China.” When a reporter from Reveal confronted Pope with the financial documents showing the Chinese government’s support for the deal, the first thing he said was “Wow.” (Keira Lombardo, Smithfield’s senior vice president of public affairs, contested the characterization that the Chinese government directed the purchase.) Today, Smithfield sends more than a quarter of its pork abroad, especially to China, which received nearly 300,000 tons in 2016. Part of what made the company such an attractive target is that it’s about 50 percent cheaper to raise hogs in North Carolina than in China. This is due to less-expensive pig-feed prices and larger farms, but it’s also because of loose business and environmental regulations, especially in red states, which have made the U.S. an increasingly attractive place for foreign companies to offshore costly and harmful business practices. America’s top hog-producing county is Duplin County, North Carolina, where future hams outnumber humans about 30 to 1. In this rural expanse of sandy fields and loblolly pines, about 2 million pigs are warehoused in hundreds of football-field-size metal barns – about 2,450 pigs per square mile. All those pigs produce a tremendous amount of waste. A mature hog, whose only activity is to eat, excretes about 14 pounds of manure a day, which means Duplin’s hogs generate about 15,700 tons of waste daily – twice as much poop as the human population of the city of New York, according to Food and Water Watch. Behind each barn, millions of gallons of liquid hog waste are kept in colossal open-air lagoons – essentially pits dug into the clay, many without a concrete or plastic liner. To prevent overflowing, farms spray it out as fertilizer on crops, which can create a mist that drifts onto nearby homes and into their inhabitants’ lungs, causing all manner of respiratory and health problems. The waste can also leak through the clay pits into the water table, or flood the whole region, as happened in 1996 and 1998 when hurricanes inundated the area. Eastern North Carolina is packed with more than 9 million pigs; the state’s top five hog-producing counties alone produce 15.5 million tons of manure annually. An analysis by the Environmental Working Group found that 160,000 people living in the region may be harmed by pig waste. And those victims are disproportionately minorities, according to studies conducted by the University of North Carolina-Chapel Hill. As Naeema Muhammad, co-director of the North Carolina Environmental Justice Network, says, “What’s happening in eastern North Carolina is that poor people are literally getting shit on.” Globalization has allowed rich countries like America to outsource polluting industrial processes to poorer nations. But as China becomes increasingly wealthy and assertive, says Democratic Sen. Cory Booker, “it is outsourcing a dirty industry to the United States so they don’t have to bear its pollution and they can just send the finished product back home.” More than just America’s environment and human health is at stake. “Low-paying jobs, like hog slaughtering and breeding, will remain in places like Duplin County, but the higher-paid executive and marketing jobs will be lost,” says Usha Haley, a professor at West Virginia University who has studied the Chinese takeover of American agricultural assets for a decade. “China will not care about the health of people living beside the hog farms. China will act in its own self-interest to leave the pollution here, but take the valuable clean pork back to China.” As jobs and talent have flocked to American cities, once-prosperous rural communities are finding their primary competitive advantages are desperate residents willing to work cheap, and local Republicans ready to extend tax breaks and slash regulation. American companies have long taken advantage of these trends. A leaked report from the 1980s, which was prepared for a waste-management company seeking a community for “locally undesirable land use,” listed the “least resistant personality profile” as: “longtime residents of small towns in the South or Midwest,” “conservative,” “Republican” and “advocates of the free market.” In recent years, foreign conglomerates have seized upon this workforce as well. In 2011, the last time the United States Department of Agriculture released figures, overseas entities owned agricultural acreage roughly the size of Virginia, holdings that have only continued to grow. Investors from Saudi Arabia and the United Arab Emirates have since purchased 15,000 acres of the parched Southwest to grow water-intensive crops, such as alfalfa hay for their dairy herds back home. In the case of Smithfield Foods, WH Group inherited a practice in which local farmers are encouraged to build facilities on credit for raising pigs set for slaughter. As a result, the company now owns the hogs, the most lucrative part of the business, while the North Carolina farmers own the shit – and all the environmental and human liabilities from it. As Jason Gray, a senior researcher at the economic-policy organization NC Rural Center explains, “The dilemma rural economies face is that you’ll reach for anything if you have nothing.” “We can only stay a few minutes,” René Miller says, as we park at her family graveyard. Miller grew up on a neighboring farm about half a mile away, on land that had belonged to her family since the Civil War. But when her mother went to get loans to modernize their farm, Miller says, she was turned down by banks and the USDA. Such stories of discrimination are common among African-American farmers in North Carolina. The family that owned the land where Miller’s kin now lie took out a loan from someone advertising on TV as “Mr. Cash.” After the property went into foreclosure, the acres the family owned for more than a century were bought by a white farmer. In 1999, the USDA settled a billion-dollar class-action lawsuit initiated by a North Carolina farmer, admitting African-Americans had been denied loans because of their race. Now, Miller is only allowed on the property to visit her dead. Opening the van door, the stench – animal and fecal – wets the air like humidity. The source is a few hundred feet away: six airplane-hangar-like metal barns, warehousing around 4,300 hogs, backed by three acres of liquid pig waste in an open-air lagoon. Miller brushes fallen pine needles off the headstones of her grandmother and her mother, before reaching that of her nephew, who recently died of cancer. As she kneels next to the stone, she tells me, “I think it killed him.” She means the hog waste. Specifically, the approximately 30 tons of manure the swine in the barns excrete daily through slatted floors into the lagoon, which is then pumped through an industrial sprayer to fertilize crops. These clouds of aerosolized feces, Miller says, drift over a country road and coat her home, where her nephew once lived. Both times I visited, the sprayers in the field across the road were off, but the reek was noticeable inside the house, despite the cardboard barriers Miller had improvised to seal her windows. The industry describes hog waste as “organic fertilizer,” though in reality it is potentially lethal. To keep swine alive in overcrowded hothouses, where diseases spread rapidly, pigs are treated with antibiotics, vaccines and insecticides, all of which eventually pass into the lagoons, which have been found to contain toxic chemicals, nitrates, parasites, viruses and more than a hundred strands of antibiotic-resistant microbes, including salmonella, streptococci and giardia. People die with distressing regularity in the waste: In 2015, an Iowa teenager overcome by methane, ammonia and carbon dioxide fumes fell into the sludge. When his father tried to haul him out, they both drowned in excrement. In 2008, a Government Accountability Office survey found 15 studies that linked animal waste from industrial livestock farms with widespread health problems. Living near hog farms increases people’s risk for respiratory problems, diarrhea, eye irritation, depression, high blood pressure, miscarriages, and impaired thinking and breathing; Miller blames the pig waste for her asthma, sarcoidosis and heart ailments. Livestock farmers themselves have been found to be more likely to suffer from respiratory illnesses like chronic bronchitis and antibiotic-resistant staph infections. Even people who live much farther away from hog farms can suffer from the fallout. A North Carolina Department of Health and Human Services study found that students in middle schools up to three miles away had higher rates of asthma. Just being able to smell the stink has been correlated with increased tension, anger, depression, fatigue and confusion. Leaks through the clay bottoms of lagoons can spread E. coli into groundwater and nearby wells. Hog waste has not been proved to correlate with cancer, but researchers at Duke University are currently conducting a wide-ranging study into possible links. Shane Rogers, a professor at Clarkson University and former Environmental Protection Agency engineer, has studied the issue extensively. “A wide body of research,” he says, “shows that living near pig farms can be hazardous to people’s health.” Source
  22. On Wednesday Cook delivered some of his strongest criticism yet of advertising-supported tech giants. He went on to indict algorithmic feeds and the ways in which they are abused: “Platforms and algorithms that promised to improve our lives can actually magnify our worst human tendencies. Rogue actors and even governments have taken advantage of user trust to deepen divisions, incite violence, and even undermine our shared sense of what is true and what is false. This crisis is real. It is not imagined, or exaggerated, or crazy.” Indeed — there are even daily newsletters about it! Cook’s speech had an important, and unstated, element of self-interest. Regular readers of this column know that California passed a privacy law this year that attempts to bring General Data Protection Regulation-style privacy protections to its citizens. All the big platforms are leery of a patchwork of such regulations breaking out all over the country. That’s why Cook took time today to call for a national privacy regulation, one which would allow Apple to operate uniformly across the country. But Cook’s commitment to privacy comes with an asterisk: the company’s government-ordered requirement to store iCloud user data on the servers of a state-run telecom. Alex Stamos, the recently departed chief security officer of Facebook, pointed out the issue in a valuable Twitter thread. “Tim is right, privacy is a fundamental human right,” Stamos wrote. “I believe that Chinese people should have the same access to fundamental human rights as the rest of the world. Apple needs to document how they protect data stored by a PRC-owned cloud provider.” As Stamos points out, iMessage is the only approved messaging app with end-to-end encryption allowed in China. He called on Apple to disclose under what circumstances Chinese authorities could access iCloud backups — and whether Apple made concessions there it hasn’t made elsewhere. “Perhaps the answer is ‘no concessions, there is no practical mechanism for the MSS to get access to iCloud data,” he said, referring to the Ministry of State Security. “That would be wonderful, but we shouldn’t assume it to be true.” Apple declined to comment when I asked. In July, when the company made the deal with China’s Guizhou-Cloud Big Data, Apple issued a lengthy statement in which they reiterated their commitment to privacy and security. But they also said this: Of course, even if Apple has made concessions to the Chinese government, it doesn’t mean the company isn’t sincere about its belief in a right to privacy. Nor does it take away the very real steps Apple does take to protect users’ privacy, particularly when compared to Facebook and Google. But Facebook employees have had to endure months of taunting from Cook, and to date the company has mostly suffered in silence. Stamos doesn’t work there anymore, and he doesn’t speak for Facebook in any official capacity. Still, I’d wager that his former colleagues cheered when they saw his tweetstorm today. (At press time, he had just posted a second one, lamenting the positive coverage Cook got for his remarks.) Google and Facebook have faced blistering criticism lately for their attempts to work in China. That Apple has operated for so long in the country with so little discussion of the potential for government access to user data seems, in light of Cook’s speech, all the more conspicuous. Source
  23. Has China found a way to spy on computers used by the world’s top tech firms and perhaps even the US government by implanting them with tiny secret microchips? That’s what was alleged in a recent article from Bloomberg Businessweek, which claimed the US is investigating some form of spy microchip thought to have been inserted into Chinese-made circuit boards used by a company that produces video data servers. Its products have, according to Bloomberg, been purchased by Apple, Amazon and many other large firms, as well as the US departments of Defense and Homeland Security, Congress and NASA. If proved true, these allegations would have huge implications for all the parties involved, as well as for global security, trade, and international relations. But the supplier of the allegedly hacked hardware, the companies that bought it, and the Chinese government have repeatedly and strenuously denied that the chips exist or that any server hardware was compromised. US and UK officials have backed the denials, while the FBI has stated that it is their policy “to neither confirm nor deny the existence of an investigation.” The problem is that, at this stage, it’s impossible to know who’s telling the truth. The chip described in the report is said to be disguised as an extremely small and otherwise unremarkable electronic component. Proving that it even exists, let alone what it does, would require careful reverse engineering and security analysis by somebody with access to the allegedly afflicted hardware. Security technology researchers I have consulted are adopting a “wait and see” attitude until more information emerges. Bloomberg’s story relies entirely on unnamed sources. Until somebody comes forward with a credible and detailed technical report, there is little to be gained by speculating about this specific incident. But if it were true, the nature of the incident would make it very difficult for authorities to respond. The alleged attack quickly captures the imagination because it highlights a well-known challenge in cybersecurity: maintaining the integrity of end-point hardware. End-point hardware in this context simply means any device used to transmit or receive electronic messages. This can include obvious items like smartphones, laptops and servers, but also the growing body of “Internet of things” devices such as smart home appliances, self-driving cars and connected industrial machinery. If an attacker gains physical access to an end-point device, this can subvert multiple layers of security. A well-known example was publicised in 2013 when a criminal gang installed covert “KVM switches” onto computers in London bank branches. These simple and inexpensive pieces of equipment let attackers monitor what a computer is doing and then operate it remotely. In this way, accessing the physical equipment effectively gets around a variety of protective measures. The chips described in the Bloomberg article are a much more technologically sophisticated example of the same basic idea. In this case, it is alleged that the offending hardware is a specially designed chip the size of a grain of rice, manufactured and distributed at a large scale. Legal action If a government was able to prove an attack like this was carried out by another state, there are a range of responses available. A conspiracy to install and operate a system of this type would constitute a crime under the domestic laws of most states. Jurisdictions such as the US and UK could attempt to prosecute people involved in this kind of conspiracy using laws that criminalise unauthorised access to a computer and interception of communications, among others. But any such criminal prosecution would face three significant hurdles. You would need to identify and indict the suspects involved in the conspiracy and physically arrest or extradite them. You’d then have to present enough evidence to persuade a jury of guilt beyond reasonable doubt. In recent years, US law enforcement officials have announced criminal indictments of individuals accused of international cyber-espionage. But there is no realistic prospect that any of the accused parties, as employees of a state security agency, would be extradited to face charges in a US court. Instead, it is widely believed that such public announcements are designed signal awareness of state cyber-operations and potentially to deter such operations. If domestic law provides little hope of action, what about international law? Even if overwhelming evidence is produced to demonstrate that the chips exist and that the Chinese government directed their deployment, as a legal matter there is nothing to suggest that these actions actually constitute a “cyber-attack,” as that term is used in international law. There is a sharp distinction between state acts of violence, and non-violent espionage or psychological (propaganda) operations. Principles of international law require that any state response should be proportional and therefore limited in this case to non-violent options such as a diplomatic complaint or economic sanctions. Nothing in the reporting suggests an outbreak of actual cyberwar. At worst, what we see is the latest chapter in a still developing, complex, and poorly understood cyber “cold war”. Source : Hong Kong Free Press
  24. BEIJING (Reuters) - China’s agriculture ministry said on Wednesday it would ban the feeding of kitchen waste to pigs after linking the practice to the majority of the early cases of African swine fever. The statement from the Ministry of Agriculture and Rural Affairs is the government’s first comment on how the deadly disease has spread in the world’s top pork producer. China has reported more than 40 outbreaks of the highly contagious disease since early August, with farms across 12 provinces and municipalities already infected. It does not affect humans. Beijing has not yet said how the disease first entered the country but the ministry found 62 percent of the first 21 outbreaks were related to the feeding of kitchen waste, a statement published on its website said. “These outbreaks were mostly located in urban-rural boundaries, and were particularly evident in several cases in early September in Anhui province,” the statement said. Anhui is an eastern province whose capital Hefei is located about 415 km (258 miles) west of Shanghai. The virus was also detected in kitchen waste fed to pigs on a farm in the Inner Mongolia region, it added. “After the provinces with outbreaks and neighboring provinces completely banned feeding of kitchen waste to pigs, the epidemic was greatly reduced, which fully demonstrates the importance of completely prohibiting the feeding of waste,” the statement said. Kitchen waste or swill is widely used in China to feed hogs, particularly by small farmers, as it is cheaper than manufactured pig feed. Regulations require that the swill must be heated to a certain temperature before being consumed but industry experts say that step is often skipped. The ministry also said in the statement it will set up a registration system for vehicles transporting live hogs, poultry and other livestock to control the spread of the disease better. The long distance transport of live hogs has been the main channel for transmitting African swine fever across different regions, it said. Vehicles transporting pigs and other animals will also no longer be allowed to use the “green channel” for priority on roads that is normally permitted for the trucking of fresh produce, added the ministry. It called for more slaughtering closer to farms and the use of refrigerated transportation to better manage the supply of livestock across different regions. China has promoted construction of new farms in the north-east in recent years, closer to its grain supplies. But the policy, which has not yet been accompanied by investment in new slaughterhouses, has led to large numbers of pigs being trucked long distances south. For a graphic on Swine fever in China, see - tmsnrt.rs/2PDt6Ud Source
  25. New policy will require users to provide identity information to use any blockchain service After killing all legitimate cryptocurrency businesses in the country, Chinese authorities are now turning their attention to other blockchain service providers. The country’s apex internet regulator, Cyberspace Administration of China (CAC), released a draft policy on Friday that will require all companies to collect their users’ real names and national identification card numbers before offering them any blockchain related service. The draft regulations are open to comments from the public until November 2, but CAC hasn’t given any timeline for when they will actually come into force. If the policy is implemented, the companies will be required to store their users’ data — to be made available for any investigation by the authorities. In addition, they also have to censor any content “deemed to pose a threat to national security.” Blockchain service providers will need to register with the CAC within ten days of starting the service. If they are in highly regulated fields in the country, such as education, media & publishing, or the pharmaceutical industry, they will also have to obtain licences from relevant authorities before registering with the CAC. According to South China Morning Post (SCMP), an anonymous open letter published on the Ethereum blockchain in April alleging sexual harassment at a top university could be the motivation behind the new regulations. While the authorities were able to remove the post from social media platforms like WeChat and Weibo, they were hopeless on the blockchain. The new regulations come hardly as a surprise. China’s aversion to free dissemination of information isn’t exactly a secret — with media giants such as Google, Facebook, Twitter, and Youtube banned in the country. Blockchain as a concept is even more opposed to Chinese government’s totalitarian communist ideology. China has been rigorously cracking down on “all things cryptocurrencies—” banning all exchange desks, media platforms, initial coin offerings (ICO), and any platform promoting or trading virtual currencies in any way. But research shows that the country’s outright bans haven’t exactly deterred illegitimate cryptocurrency businesses from operating in the country. It is likely that its blockchain regulations will end up with a similar fate. Source
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