Welcome to the Tech Diplomacy Now Substack
The intersection of technology, policy, and the news you need to know
Welcome to Tech Diplomacy Now, a publication of the Krach Institute for Tech Diplomacy at Purdue University, providing you with critical information and global news on the intersection of emerging technologies, foreign policy, and national security.
Technology is the crossroads and main battlefield of the four-dimensional diplomatic, economic, cultural and military contest between freedom and authoritarianism. Technology is either grounded in trusted democratic principles—respect for the rule of law, human rights, property, transparency, sovereignty and the environment—in order to advance freedom, or it is weaponized by authoritarian regimes and malign actors in order to control and oppress.
We believe technology must advance freedom.
The nonpartisan Krach Institute for Tech Diplomacy at Purdue is the preeminent global authority on Tech Statecraft, a new model of diplomacy that integrates high-tech strategies with foreign policy and national security tools to ensure trusted technology is used to advance freedom. We focus on rallying our allies, leveraging the innovation of the private sector, and amplifying democratic values based on trust, leveraged by Purdue University’s strength in innovation, deep expertise in technology, and global prowess in educating transformational leaders.
We hope you find Tech Diplomacy Now a valuable resource on the emerging critical issue of technological diplomacy and its impact on our way of life.
Top News of the Week – TikTok’s CEO Testifies to Congress
On Thursday, TikTok’s CEO Chew Shou Zi testified before the House Energy and Commerce Committee. TikTok, the wholly-owned subsidiary of the Beijing-based ByteDance, faces the prospect of either severing its relationship with ByteDance (which the Chinese Government has all but vetoed) or being banned in the United States. (Watch the full hearing here)
Chew’s testimony was just one more chapter in a saga that has been unfolding for almost five years as the U.S. government increasingly sees ByteDance’s short-form video app as a national security threat.
During his testimony Chew admitted to U.S. lawmakers that China-based employees of ByteDance may still have access to data of U.S. citizens, but that TikTok’s Project Texas would end that access by placing all U.S. user data within the Oracle Cloud Enterprise managed exclusively U.S. Data Security, a subsidiary of TikTok and staffed solely by Americans in the United States.
It remains to be seen whether that will satisfy U.S. lawmakers, as Chew himself is just an employee of the parent company ByteDance and has only worked for the company since March 2021. Chew’s commitments to Congress and internal privacy policies likely cannot supersede decisions by the parent company.
The other issue that remains unresolved is how the underlying algorithms, which presumably belong to the parent company and are controlled from Beijing, could be manipulated to present U.S. users with content that ByteDance would want them to see. The fact that an increasing number of Americans consider TikTok to be their primary news source, creates a significant vulnerability that the Chinese Communist Party could exploit.
If TikTok were a television or radio station, its ownership structure would be examined in its licensing process. No television or radio station with the foreign ownership of TikTok would receive a license from the FCC. This loophole for social media apps that increasingly serve the purpose of ‘common carriers’ is something Congress will likely need to address given the years of evidence that countries like Russia and China use social media to sow division and disinformation (and here and here).
Michelle Giuda, Director of the Krach Institute for Tech Diplomacy at Purdue, penned this op-ed in The Hill: The dark side of TikTok.
For a solid recap of the testimony see the article from Vox’s Sara Morrison and Christian Paz, 3 winners and 3 losers from Congress’s TikTok hearing.
What to expect next:
Congress is considering a few bills that would enable the Biden Administration to force ByteDance to divest of TikTok or ban its operation in the United States. It remains to be seen whether Chew’s testimony will have any influence.
For background, some stories and think tank reports to be aware of before Thursday’s committee meeting:
TikTok admits tracking FT journalist in leaks investigation – Financial Times, December 22, 2022
Justice Dept. Investigating TikTok’s Owner Over Possible Spying on Journalists – New York Times, March 17, 2023
More Americans are getting news on TikTok, bucking the trend on other social media sites – Pew Research Center, October 21, 2022
TikTok hits 150 mln U.S. monthly users, up from 100 million in 2020 – Reuters, March 20, 2023
A former TikTok employee tells Congress the app is lying about Chinese spying – Washington Post, March 10, 2023
TikTok, ByteDance, and their ties to the Chinese Communist Party – Report submitted to the Australian Senate Select Committee on Foreign interference through Social Media, March 14, 2023
China’s New Way to Control Its Biggest Companies: Golden Shares – Wall Street Journal, March 8, 2023
Biden’s TikTok Dilemma: A Ban Could Hurt Democrats More Than Republicans – Wall Street Journal, March 13, 2023
___________
Announcements
Earlier this month, the Global Tech Security Commission, an international commission led by Keith Krach and former President of Estonia, Kersti Kaljulaid, announced the naming of four federal lawmakers representing both parties and both houses of Congress as new Honorary Co-Chairs.
In addition, Robert Hormats, who served as Under Secretary of State for Economic Growth, Energy, and the Environment from 2009 to 2013, was named an Honorary Co-Chair, bringing expertise from a distinguished career in diplomacy that began in the 1970s.
The five new Honorary Co-Chairs join a group of six previously named Honorary Co-Chairs: Senators Jeanne Shaheen (D-N.H.), Joni Ernst (R-IA) and Bill Hagerty (R-TN), and Representatives Michael McCaul (R-TX), Raja Krishnamoorthi (D-IL) and Lori Trahan (D-MA). Collectively, these Honorary Co-Chairs represent significant leadership on Capitol Hill’s focus on global tech security.
“Congress asked for a thorough, bipartisan playbook for advancing global tech security with our allies,” said Co-Chair Keith Krach. “The fact that the Honorary Co-Chairs who represent some of the most respected foreign-policy leaders in Congress are putting their weight behind the commission demonstrates the criticality of the mission. In this fight for freedom against technological authoritarianism, failure is not an option.”
GTSC operations are supported through a partnership between the Krach Institute for Tech Diplomacy at Purdue and the Atlantic Council.
___________
Latest News
WHO abandons plans for crucial second phase of COVID-origins investigation – Nature, February 14, 2023
The World Health Organization (WHO) has quietly shelved the second phase of its much-anticipated scientific investigation into the origins of the COVID-19 pandemic, citing ongoing challenges over attempts to conduct crucial studies in China, Nature has learned.
Researchers say they are disappointed that the investigation isn’t going ahead, because understanding how the coronavirus SARS-CoV-2 first infected people is important for preventing future outbreaks. But without access to China, there is little that the WHO can do to advance the studies, says Angela Rasmussen, a virologist at the University of Saskatchewan in Saskatoon, Canada. “Their hands are really tied.”
CIA future will be defined by US technology race with China, director says – Reuters, March 8, 2023
The U.S. Central Intelligence Agency’s future will be defined by America's ongoing technology race with China, agency director William Burns said on Wednesday during a Senate hearing.
Burns’ remarks followed the release of the Annual Threat Assessment of the U.S. Intelligence Community, which pointed to China as the biggest national security threat facing America. The report cited China’s robust use of cyber tactics to surveille Americans, its success at stealing intellectual property, and ability to acquire foreign technologies.
Xi Jinping vows to make Chinese military ‘great wall of steel’ as tensions rise with west – Financial Times, March 13, 2023
‘Hunting rifles’ — really? China ships assault weapons and body armor to Russia – Politico, March 16, 2023
Customs data obtained by POLITICO reveals direct shipments of Chinese assault rifles, as well as drone shipments and body armor routed via Turkey and the UAE.
Wave of Stealthy China Cyberattacks Hits U.S., Private Networks, Google Says – Wall Street Journal, March 16, 2023
Technology and Industrial Policy
Prestigious Pasteur Institute severs ties with China infectious disease lab
Smriti Mallapaty, Nature, March 9, 2023
The influential Pasteur Institute in Paris says it has suspended its partnership with the Chinese Academy of Sciences (CAS), Beijing, and will cease to co-lead an institute in Shanghai, Nature has learnt.
Apple Supplier Foxconn Plans to Rely Less on China for Revenue – Wall Street Journal, March 15, 2023
Controlling the innovation chain: China’s strategy to become a science & technology superpower – MERICS, February 2, 2023
Europe’s Strategic Technology Autonomy from China – DGAP (German Council on Foreign Relations), January 25, 2023
Silicon Valley Bank’s Troubles Threaten a Key Bridge Between Chinese Startups and U.S. Investors – The Information, March 10, 2023
The panic over the status of Silicon Valley Bank intensified on Friday, as the stock of SVB’s parent fell another 66% in pre-trading hours. Meanwhile, anxieties spread to China overnight, prompting local venture capitalists and entrepreneurs to follow their U.S. counterparts and look for alternative banks for their U.S. dollar holdings.
The fate of SVB is a huge concern in China, the world’s second-largest venture capital market after Silicon Valley, because SVB was among the first financial institutions to start catering to Chinese startups when traditional banks shunned them. The bank established its first Chinese arm nearly two decades ago.
Artificial Intelligence
U.S. Outbound Investment into Chinese AI Companies – CSET, February 1, 2023
Leaders of Self-Driving-Truck Company Face Espionage Concerns Over China Ties – Wall Street Journal, February 1, 2023
China’s AI Chatbots Clam Up When Asked About Xi Jinping’s Leadership – Wall Street Journal, March 15, 2023
Baidu has developed its own version of OpenAI’s ChatGPT that some have dubbed as ‘ChatCCP’. The chatbot declines to answer questions related to Chinese or American politics and tries to change the topic when asked to assess the leadership of Xi Jinping.
China’s ChatGPT rival Baidu Ernie is off to a rough start – TechCrunch, March 16, 2023
Following on the heels of GPT-4’s buzzy debut and the announcement of Microsoft 365’s AI makeover, Baidu, China’s search engine giant, introduced its Ernie Bot.
But the public was clearly underwhelmed. Industry observers inside and outside China pointed to the fact that rather than showcasing Ernie through a live demo, Baidu opted for a lengthy presentation with pre-recordings of Ernie’s answers. The company’s shares slumped as much as 10% in Hong Kong following Li’s presentation.
Chinese AI groups use cloud services to evade US chip export controls – Financial Times, March 8, 2023
Telecommunications Networks and Infrastructure
Taiwan suspects Chinese ships cut islands’ internet cables – Associated Press, March 8, 2023
China exerts control over internet cable projects in South China Sea – Financial Times, March 13, 2023
Bundesregierung will Komponenten von Huawei und ZTE verbieten [Federal government wants to ban components from Huawei and ZTE] – Zeit Online, March 6, 2023
The federal government plans to ban mobile operators from installing certain controls from Chinese manufacturers Huawei and ZTE in their 5G networks. ZEIT ONLINE learned this from government circles. This ban should also affect components that have already been installed by the providers. That would force companies to retool.
The Federal Office for Information Security (BSI) and the Federal Ministry of the Interior have been checking for months whether there are components in the systems of the currently growing 5G network that could endanger German security. The authorities are concerned that suppliers from countries such as China are controlled by their governments and that they could have direct or indirect access to German mobile networks. This test has not yet been officially completed, but the result is now apparently certain.
Überwachung in Deutschland – made in China [Surveillance in Germany – made in China] – Handelsblatt, March 3, 2023
Some countries have already restricted the use of cameras for security reasons, but Germany has not yet. How dangerous is that for critical infrastructure?
Webinar: Huawei and 5G investment in Saudi Arabia – Krach Institute for Tech Diplomacy at Purdue, March 2, 2023
Critical Minerals
China's hunt for strategic new energy minerals – Nikkei Asia, February 14, 2023
Chinese companies are scouting the world for mining assets as the country's booming new energy vehicle industry boosts demand for lithium, cobalt and nickel -- key metals used in batteries for electric and hybrid vehicles.
US Seeks Critical-Mineral Pacts with Japan, UK to Curb China – Bloomberg, February 10, 2023
Deals would open eligibility to Inflation Reduction Act perks. US wants new critical mineral buyers club, officials say.
EU seeks to diversify critical raw material supply away from China – Nikkei Asia, March 17, 2023
Synthetic Biology
China’s Securitization of Genetic Research – The Diplomat, March 13, 2023
China to ban export of cutting-edge cell technologies – BioProcess International, February 9, 2023
China is planning to prohibit any export from biotech companies engaged in certain pioneering cell and gene editing technologies. The proposed ban affects companies developing cell cloning and gene editing technology for human use, along with restrictions on the export of CRISPR gene editing technology and synthetic biology technology.
Sino Biopharm Wins CFIUS Approval for $161 Million F-Star Deal – Bloomberg, March 7, 2023
Sino Biopharmaceutical Ltd.’s invoX Pharma unit has won approval from the Committee on Foreign. Investment in the United States to proceed with its $161 million takeover of F-star Therapeutics Inc.
Quantum
The National Quantum Initiative Supplement to the President’s FY 2023 Budget Released – U.S. National Quantum Coordination Office, January 6, 2023
The China-US Quantum Race – The Diplomat, January 13, 2023
The United States and the Netherlands Sign Joint Statement to Enhance Cooperation on Quantum – U.S. National Quantum Coordination Office, February 15, 2023
High-performance photon detectors to combat spies in the quantum computing age – Phys.org, March 13, 2023
Securing Data for a Post-Quantum World – Government Accountability Office, March 8, 2023
Advanced Aerospace Technology
China threatens to block Musk's Starlink with rival fleet of 13,000 satellites – The Telegraph, February 27, 2023
Lasers and microwaves could be used to shoot down internet-providing satellites.
China has threatened to block Elon Musk’s Starlink with a rival fleet of 13,000 satellites amid claims they pose a potential military threat and could spy on the Communist country.
Studying Ukraine war, China's military minds fret over US missiles, Starlink – Reuters, March 7, 2023
Low Orbit, High Stakes: All-in on the LEO Broadband Competition – CSIS, December 14, 2022
A Vision for America’s Continued Global Leadership in Aeronautics – U.S. Office of Science and Technology Policy, March 17, 2023
National Aeronautics Science and Technology Priorities – U.S. Office of Science and Technology Policy, March 17, 2023
Semiconductors and Microelectronics
I Saw the Face of God in a Semiconductor Factory – Wired, March 21, 2023
The CHIPS and Science Act, which US President Joe Biden signed into law in August 2022, grew out of a $12 billion deal to bring TSMC fabs to American soil. That deal was brokered in large part by Keith Krach while he served as the US’s chief economic diplomat. Among Krach’s goals was to fortify a dependable supply chain based on TSMC’s broad network of suppliers. The CHIPS Act now provides roughly $280 billion to boost American semiconductor research, manufacturing, and security, with the explicit aim of aggressively sidelining China from the sector—and thus from the world economy. “Xi is absolutely obsessed with the semiconductor business,” Krach tells me.
While at the State Department, Krach pulled off a masterstroke. In the early days of 5G networks—extremely low-latency broadband that allows even surgeons to work remotely—Krach ventured out on a global round of freestyle diplomacy. During the height of the pandemic, he and a small, masked delegation zipped around the world to more than 30 countries, from Spain to the Dominican Republic to Cyprus to the United Arab Emirates. He aimed to persuade powerful figures in a range of positions that they shouldn’t work with the Chinese company Huawei on 5G, however right the price. To do so would be to subject their networks to Chinese infiltration, and “dirty” networks, Krach said, would be banned from America’s reindeer games.
China’s Top Nuclear-Weapons Lab Used American Computer Chips Decades After Ban – Wall Street Journal, January 29, 2023
Clues to the U.S.-Dutch-Japanese Semiconductor Export Controls Deal Are Hiding in Plain Sight – CSIS, March 1, 2023
Netherlands to tighten export controls of chip equipment: minister – Nikkei Asia, March 17, 2023
The Netherlands aims to respond to U.S. semiconductor restrictions on China by expanding the list of chip manufacturing equipment subject to export controls to prevent military use, the Dutch trade minister said.
Liesje Schreinemacher told Nikkei Asia here on Friday that The Hague has decided to include some of the latest models of deep ultraviolet (DUV) lithography tools to its export control list by summer after "doing assessments concerning our national security."
Biden Administration Set to Further Tighten Chipmaking Exports to China – Bloomberg, March 10, 2023
The Biden administration is working to further tighten restrictions on the export of semiconductor manufacturing gear to China, escalating rules aimed at preventing the country from developing an advanced chip industry.
The government has briefed US companies about the plan, telling them that it expects to announce the new restrictions as early as next month, according to people familiar with the situation. The rules may as much as double the number of machines that require special licenses for export, creating fresh hurdles for makers of the equipment such as Applied Materials Inc., said the people, who asked not to be identified because the deliberations are private.
Energy and Climate
EV battery material suppliers brace for gluts as competition heats up – Nikkei Asia, February 6, 2023
China is building six times more new coal plants than other countries, report finds – NPR, March 2, 2023
China permitted more coal power plants last year than any time in the last seven years, according to a new report released this week. It's the equivalent of about two new coal power plants per week. The report by energy data organizations Global Energy Monitor and the Centre for Research on Energy and Clean Air finds the country quadrupled the amount of new coal power approvals in 2022 compared to 2021.
That's despite the fact that much of the world is getting off coal, says Flora Champenois, coal research analyst at Global Energy Monitor and one of the co-authors of the report.
"Everybody else is moving away from coal and China seems to be stepping on the gas," she says. "We saw that China has six times as much plants starting construction as the rest of the world combined."
US Ambassador Peter Pham on minerals shortage for clean energy tech – Energi Talks Podcast, March 15, 2023
Opinion and Commentary
Cold War 2.0: Sliding Toward a New Cold War – Evan Osnos, The New Yorker, February 26, 2023
Not since the Berlin Wall fell has the world been cleaved so deeply by the kind of conflict that John F. Kennedy called a “long, twilight struggle.”
A Wake-Up Call for Green Energy Dreams – J. Peter Pham, The National Interest, February 21, 2023
China’s Brute Force Economics: Waking Up from the Dream of a Level Playing Field – Liza Tobin, Texas National Security Review, December 2022
How Xi Jinping is fortifying China's economic security – Naoko Eto, Japan Times, March 2, 2023
More players in the global economy are now prioritizing national security as well as economic efficiency, with economic security increasingly drawing attention.
The Last Word
TikTok ‘disguised as candy but it’s really cocaine,’ fmr. diplomat says – Yahoo! Finance, March 23, 2023
Sorry to hear that. blockchain sports betting - something new, but I'm into it! Just made first bets! - https://tinyurl.com/3fbhv4ts