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Can China take a lesson from Estonia?

Benjamin Bathke
November 15, 2018

Both China and Estonia have built digital public data systems that play a big role in everyday life. The major difference is China is exerting control and Estonia is fostering trust.

Symbolfoto Big Data
Image: Imago/IPON

In November, China hosted the "World Internet Conference" to advance an open digital economy. Chinese President Xi Jinping said the development of the internet "knows no national boundaries."

In a country developing one of the most stringent online censorship regimes, it may seem counterintuitive that China is pouring massive amounts of resources into becoming a leader in digital innovation and artificial intelligence.

Organizations like Freedom House call China the "world's worst abuser of internet freedom" and warn that "growing police access to user data have turned China into a 'techno-dystopia.'"

Read moreChina's 'digital authoritarianism' is threatening democracy globally, claims watchdog 

A big part of China's growing "techno-dystopia" is a social credit system, which from 2020 onward will evaluate and store all citizens' credit-worthiness based on a pre-determined set of social behavior standards. This also applies to companies, organizations and government agencies.

People who don't visit their aging parents regularly, for example, will get minus points. The same goes for people who cross the street on a red light or illegally dump their garbage. And in the city of Zhengzhou, one of more than 40 Chinese cities where pilot projects are currently taking place, people who don't respond to a court order will be reminded of that fact every time they answer their phone.

"Trustworthy" or "dishonest" citizens or companies are either rewarded or punished. Wrongdoers risk losing their right to government services like public housing or can no longer send their children to private schools, for example. People can improve their social score by denouncing fellow citizens.

The aim of this system, which the Economist has called "digital totalitarianism," is to educate the Chinese society to "honest" behavior in the sense of the Communist Party.

Estonia provides the counter-example?

In contrast to China, both in size and approach to public data, the small Baltic state of Estonia has built a reputation for pioneering virtual government services ("e-Estonia"). Built on blockchain technology, Estonia offers citizens more than 4,000 virtual services, including a digital ID, online tax returns, internet voting, healthcare data, electronic signatures and government-issued digital residency for non-resident citizens ("e-residency").

Trust, transparency, accountability, ownership and immutability of data are key features of Estonia's system. If someone applies for unemployment benefits, for example, authorities can access exactly the data needed for the exact service in real time – but nothing else. And citizens are notified when authorities, service providers, police or doctors have looked at their data.

Read more:Is Google selling out for access to China's massive tech market? 

This reliable and secure way of exchanging information, based on transparency between citizens and the government, seems to have fostered faith between them. According to the 2014 Eurobarometer, 51 percent of Estonians trust their state, compared to only 29 percent of Europeans.

Estland elektronische Aufenthaltskarte
Estonia first introduced its digital ID in 2002. Last year, the government had to replace thousands of cards due to a security flaw. Image: e-Residency Team

Märt Aro, founder of Estonian tech startup DreamApply, said he trusts Estonia's e-government services as they were developed "keeping in mind that I would be in control of my data."

"I can log into the e-health system with my digital ID and see precisely which doctor has looked at my data at what time," he told DW. The system, he added, allows him to make some of his data invisible to his doctors, and guarantees that somebody who looks at his data without permission "will be in trouble."

Read more: China outpaces US in 5G wireless development

China's Xi Jinping urges respect for 'cyberspace sovereignty' at internet summit

Fellow countrywoman Terje Eichelmann also says she has faith in the Estonian state. "You have to have trust a priori in every relationship; so far, the government has not misused it," the 38-year-old told DW. As many of her friends work in cyber security and e-governance, she's confident the system is actually very "complex and secure" even if it looks "very straightforward and open" from the outside.

Trust the system?

Estonia's and China's approach with regard to data regulation, trust and privacy could hardly be more different. Estonia has built a trust architecture that works for the "post-privacy" world, in which knowing and sharing data isn't a problem, as long as the state guarantees that nobody tampers with it.

In China, the government is highly distrusting of its citizens and reward and punishment mechanisms are used to keep its them in check.

Made in Germany China Social Credit System
"In a country where consumers must be concerned about toxic baby milk… or where internet fraudsters harass hundreds of thousands of people, the social credit system is perceived as a platform for reliable information," according to the study.Image: DW

It is again counterintuitive that Chinese tend to not see the social credit system as a monitoring tool, and faith in the state appears to be at an all-time high. In fact, about 80 percent of China's 730 million internet users take a positive view of the social credit system, according to a recent survey of 2,200 Chinese citizens conducted by the Freie Universität in Berlin. 

While the authors of the study acknowledge that Chinese "may have been very careful" in their evaluation, they stressed that respondents confirmed the positive view in personal interviews.

The 2018 Edelman Trust Barometer echoes this finding: This year, Cathay tops the trust in institutions ranking globally, up from second place in 2017.

Still, one could argue that the massive invasion of privacy of Chinese citizens, thus forcing them in line, is not the same as trust in institutions. And nobody can predict what the possibility of denouncing fellow citizens can do the social harmony, which China tries to uphold at all costs.

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