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Scholar Sees Hurdles for China's Economy
China's economy is becoming more attractive to U.S.-based information technology investors, but there still are "risks that lie ahead," cautioned a scholar speaking Monday at a discussion titled "China After Communism."
"The private sector in China is a "shell game of government assets, bureaucrats, influence and insider trading," American Enterprise Institute Scholar and University of Pennylvania professor Arthur Waldron told a packed audience. "It’s no accident that there is yet to appear a China-based international corporation."
Despite economic liberalization, Waldron noted that capital in China is wasted. "This waste is a distortion to the information technology industry." That’s in part because entrepreneurs in China must count on bribing officials, he said.
Waldron noted that the United States is eager to get a foothold into China, but often encounters the "precariousness and volatility of Chinese society." But with increased foreign investment and events such as its presumed ascension into the World Trade Organization, China is entering in a time of transition that ultimately may lead it to becoming a parliamentary democracy. "The problem is that if China fails to fit, it is the organization that is undermined." Waldron said. "We have to be sure we squarely face the risks that lie ahead. The hard part is just beginning."
Chinese City Moves to Internet Regulation
Shanghai is moving towards a solid infrastructure to support e-commerce. Local regulators there have concerns with online business standards, which would require companies to obtain an e-digital license to conduct online commercial activity, Xinhua News reports. Shanghai Municipal Bureau for Industry and Commerce will require licenses to be posted to the homepages of companies. The local regulatory authority will offer updated information on its homepage of the validity of various licenses.
Similarly, the Shanghai Municipal Foreign Investment Committee is looking to ease regulation for foreign venture capital. Traditional banks are unwilling to offer small and medium sized start ups access to capital due to the high risks associated with dot-com firms, thus creating a bottleneck in capital funding for high tech firms in China.
China Daily reported Thursday that Shanghai will open the Zhangjiang Hi-Tech Park and will create a new organization aimed at improving services and deregulating the "red tape" for global investors.
Olympics Not the Only Thing in Sydney
In addition to hosting the world’s biggest sports event, Australia is also playing host this week to the World Economic Forum’s Asia Pacific regional meetings this week in Melbourne. Australian Minster of Communications Richard Alston is taking the opportunity to bolster the Australia's IT sector. He recently told Australia's Channel Nine, "To the extent that demonstrating our credentials and increased confidence in Australia and the long-term strategic approach that we're taking, one would hope that that will be reflected people's perceptions and their investment strategies. The fact is that we do have a number of billion-dollar (IT) companies. Many of them, of course, are only in the pages," he said.
Alston noted earlier this week that the federal government has pledged $40 million to research projects to develop Advanced Networks Program (ANP) to foster the next-generation Internet. His office also issued a statement Monday touting that nearly 91 percent of Australia’s federal agencies will offer "appropriate" services online by 2001, up from 82 percent a year ago.
But Australia is looking to tighten the reins over the laws concerning domain names. The Telecommunications Legislation Amendment Bill 2000, which currently is before Australian Parliament, gives the Australian Communications Authority (ACA) the power to arbitrate which organization will control Australia’s domain naming. As such, ACA also will have authority to determine the success of the system. Presently, domain naming in Australia is controlled by Melbourne University, although most sub-domains are run by other companies, like Melbourne IT or volunteer registrars. The government still favors self-regulation of the domain name system.
U.N. Millennium Summit Touches On Digital Divide
The digital divide was on the agenda of world leaders meeting Friday as part of the Bureau of the United Nations Economic and Social Council (ECOSOC). Heads of the groups five members nation — Abdurrahman Wahid of Indonesia, Thomas Klestil of Austria, Petar Stoyanov of Bulgaria, Paul Biya of Cameroon and Miguel Angel Rodriguez of Costa Rica — expressed concern over the lagging deployment of information technology (IT) as tool for advancing development.
The leaders argued that a majority of the world’s population is "untouched" by IT. Joined by U.N. Secretary General Kofi Annan, the leaders discussed ways to build on opportunities to promote economic growth and social development through information technology and emphasized that the United Nations has a role to play in meeting this objective. The summit concluded with the adoption of a declaration to chart the UN's role for the next century. The digital divide is widely touted as a major contributor to the poverty levels in developing countries. President Clinton reiterated his commitment to achieving poverty reduction through efforts to close the digital divide which include promoting the DOTforce, a collaboration of private sector, multilateral and non profit groups to increase global access to information technology.
Canadian Firms At High Risk For Hack Attacks
Canadian high-tech firms are at a much higher risk of being hacked according to a leading, Ottawa, Ontario-based consultant. Michael Richardson, corporate intelligence consultant and partner in Rivervine Enterprises, speaking before a technology seminar Friday, told The Ottawa Citizen that with loosened laws on corporate espionage and a treasure trove of valuable research information on global competitors, Canadian firms are doubly at risk for being hacked by corporate spies. Canada could become a portal "for the world into Americans. Those who are targeting the states will often choose to go through Canada as opposed to trying to target Americans directly," Richardson said. That’s because forms of corporate espionage illegal in the United States are not so in Canada. Hence, American companies with branches located in Canada or have Canadian partner are seen as "soft targets" for stealing corporate information. Richardson, a former Foreign Affairs Department worker, advises companies to seek professional assistance in safeguarding information. "It’s up to people to protect themselves" he said.
- by Maureen Sirhal
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