The Great Hall of the People is seen after the closing meeting of the fourth session of the 13th National People’s Congress on March 11, 2021 in Beijing, China.
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Beijing – Chinese President Xi Jinping She asked top leaders to speed up work on new laws for the tech sector during a speech in early December, according to the Chinese Communist Party’s bimonthly magazine published on Wednesday.
It’s a sign that regulations aren’t going away yet, although the rhetoric covers little new ground Economists predict that the worst of Beijing’s campaign is over.
Xi said, according to CNBC’s translation of the Chinese text, that China should “accelerate the pace of legislation in the areas of digital economy, internet finance, artificial intelligence, big data, cloud computing, etc.”
He also called for more laws to ensure national security, and urged greater use of the law in “international struggles” – including Facing foreign sanctions.
But most of Xi’s speech, delivered on December 6 to China’s Central Politburo of top leaders, focused on broad theoretical points such as not blindly following Western regimes.
In the past year, a series of new rules aimed at tackling alleged monopolistic practices by technology companies, data security and other issues have shocked global investors. Regulations address chronic problemsbut the surprise disrupted business and prompted mass layoffs.
“We expect that there will be ongoing developments in regulations especially in terms of technology,” said Mate Peking, China Director of The Economist Corporate Network. She noted that Beijing has issued plans to build a “The rule of Chinese socialist law” by 2035.
“I think the use of regulation as a tool to shape the economy and society that China wants is far from over,” Peking said.
She noted that in the West law tends to focus on the relationship between individuals and the state, while in China, the focus has been on commercial law – the relationships between the private sector and the state.
Xi’s speech – delivered more than two months ago but made public this week – is just one of many official statements made to the public in a country where information is tightly controlled.
Reading between the lines of a similar official comment, economists last week concluded that China’s worst regulatory crackdown is over Where Beijing is focusing more on growth. But they said this did not mean reversing or ending the new rules.
“Xi is putting a lot of emphasis on using the law,” said Chen Long, a partner at Beijing-based consultancy firm Plenum. “The Chinese government uses a lot of regulations to govern. It was his idea 10 years ago that he wanted to turn a lot of regulations into law, so you have a legal basis for these policies.”
Chen expects fewer surprises in tech regulation this year than last year.
But he stressed the importance of not over-reading Xi’s speech. He said, “This speech is nothing new, but rather a summary of what they did.”
Even as far as China’s use of the law to counter foreign sanctions, Beijing has done so Such legislation passed in June. If the Chinese government considers individuals or entities to be involved in taking discriminatory actions against Chinese citizens or entities, the law allows Beijing to freeze assets or refuse entry, among other measures.
“China wants to use the law to protect its interests in relation to other countries, including adding domestic authority and having a voice in shaping the rules of international law to best serve its interests — something I don’t think is unusual for any country to do,” said Jeremy Dome, fellow First at the Paul Tsai China Center at Yale University School of Law.
China’s crackdown on the technology comes at a time when the industry has grown rapidly outside the scope of current regulations. It’s a balance that governments around the world are trying to strike as they contemplate how to regulate cryptocurrency, data, and other new technologies.
Meanwhile, on the political front, Chinese authorities have ramped up their efforts to eradicate poverty and grow the middle class – moving away from prioritizing economic growth at any cost.
Much of the shift came after the ruling Communist Party of China celebrated its centenary on July 1. Next fall, the party is expected to give Xi an unprecedented third term as president.
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