China cybersecurity regulator wants to support tech growth

New and friendlier CAC, after years of cracking down

The Cyberspace Administration of China (CAC) has signaled it would like to smooth growing tensions with internet firms after a couple of years in which it strongly asserted its powers.

The bright new friendly CAC was revealed at a press conference last Friday that was billed as discussion of China's achievements in the digital era. Niu Yibing, vice minister of the CAC said China was making great strides in maintaining network power while "conforming to the development trend of the information revolution," thanks to the steady leadership of Chinese president Xi Jingping.

The vice minister rattled off a long list of achievements that included creating positive energy in cyberspace, a better digital economy, strengthening network security and increasing international cooperation.

Much of the list corresponds to actions taken by the CAC since 2020, like efforts to make the internet "more civilized," attempts to perfect consensua dat sharing, and rules over how and where data is stored. Often, these efforts came with fines, or impossible-to-refuse suggestions that Chinese tech companies perform othre corrective actions. Those seen as not following the CAC's edicts could even be subjected to blocked IPOs and other measures – as was the case with Alibaba's Ant Group – or being booted from app stores and massively fined like ride-sharing renegade DiDi Chuxing.

But the vice minister then shifted gears in the Q&A, telling the audience the agency was supportive of "the healthy development of internet enterprises, bigger and stronger," and that the CAC wants to support an entrepreneurial atmosphere.

Beijing has recently lifted some restrictions and bans. In April, it finally granted new video game licenses to 45 titles after having labelled them "spiritual opium" and spending nine months ignoring applications to approve new games. In late May, it also reversed a ban on tech companies listing offshore.

In late April, the CAC published statistics to counter any thought that the economic reality for its tech companies was getting grimmer. The statistic said that from July 2021 to mid-March 2021 payrolls increased in China's top tech companies by 79,100 people. Mum's the word on anything else since then – but a friendlier CAC could be telling. ®