Russia appears to be getting more aggressive and more successful as the nation’s hackers launch a growing number of cyberattacks against the United States and other nations, according to a new report by Microsoft. 

Microsoft’s 2021 Digital Defense Report warns that what it labels as “Russian nation-state actors” are responsible for 58% of all nation-state cyberattacks, and that they are now successful almost one out of every three times. 

“Russia-based activity groups have solidified their position as acute threats to the global digital ecosystem,” the report said, cautioning that Russian cyber actors have been adaptable, getting better at using open-source tools “that make them increasingly difficult to detect.” 

Microsoft also said Russia’s most frequent target was the United States, followed by Ukraine and Britain, and that the focus seems to be shifting toward intelligence gathering, with more than half of Russian attacks now targeting agencies involved with foreign policy, national security or defense, up from just 3% a year earlier. 

According to Microsoft, after Russia, the greatest number of cyberattacks came from North Korea, Iran and China.

North Korea’s top target was cryptocurrency companies, while Iran quadrupled its attacks on Israel as tensions between the two countries grew steadily. 

China also was active, focusing much of its cyber efforts on intelligence gathering. 

Microsoft said a large part of Beijing’s efforts, through a threat actor called Chromium, focused on gathering social, economic and political intelligence from India, Malaysia, Mongolia, Pakistan and Thailand. 

Another prominent Chinese threat actor, known as Nickel, focused its efforts on foreign ministries in Central and South America. 

The report also said that South Korea, Turkey and Vietnam were increasingly active in cyberspace, though the volume of attacks carried out from those countries paled in comparison with Russia, North Korea, Iran and China. 

Top U.S. officials have shared their concerns about the growing danger from cyberattacks, especially from nation-state adversaries, in recent weeks. And many have voiced support for legislation that would require private companies to notify the U.S. government if their systems were breached. 

“I think we’re at a point, seeing the arc of cybercrimes and the cyberthreats, that really there’s an urgency to it,” U.S. Homeland Security Secretary Alejandro Mayorkas told a virtual cybersecurity conference earlier this week. “We’re optimistic the legislation will pass.” 

Speaking at the same summit Thursday, U.S. Cybersecurity and Infrastructure Security Agency Director Jen Easterly said that while many of the threats are not new, they remain worrisome, given “how vulnerable some of our critical infrastructure sectors are.” 
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Google plans to invest $1 billion in Africa over the next five years to ensure access to fast and cheaper internet and will back startups to support the continent’s digital transformation, it said on Wednesday.

The unit of U.S. tech company Alphabet Inc made the announcement at a virtual event where it launched an Africa Investment Fund, through which it will invest $50 million in startups, providing them with access to its employees, network and technologies.

Nitin Gajria, managing director for Google in Africa told Reuters in a virtual interview that the company would among others, target startups focusing on fintech, e-commerce and local language content.

“We are looking at areas that may have some strategic overlap with Google and where Google could potentially add value in partnering with some of these startups,” Gajria said.

In collaboration with not-for-profit organization Kiva, Google will also provide $10 million in low interest loans to help small businesses and entrepreneurs in Ghana, Kenya, Nigeria and South Africa so they can get through the economic hardship created by COVID-19.

Small businesses in Africa often struggle to get capital because they lack the necessary collateral required by banks in case they default. When credit is available, interest rates are usually too high.

Google said a program pioneered last year in Kenya in partnership with Safaricom that allows customers to pay for 4G-enabled phones in instalments would be expanded across the continent with mobile operators such as MTN, Orange and Vodacom.

Gajria said an undersea cable being built by Google to link Africa and Europe should come into service in the second half of next year and is expected to increase internet speeds by five times and lower data costs by up to 21% in countries like South Africa and Nigeria.
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The United States is taking new steps to make sure the country’s air and surface transportation sectors will not be crippled by ransomware or cyberattacks.

Homeland Security Secretary Alejandro Mayorkas announced the measures Tuesday at a virtual cybersecurity conference, warning that recent incidents such as the SolarWinds hack and the Colonial Pipeline ransomware attack showed that “what is at stake is not simply the way we communicate or the way we work, but the way we live.”

The new security directives target what the Department of Homeland Security and the Transportation Security Administration describe as “higher risk” rail companies, “critical” airport operators, and air passenger and air cargo companies.

Cybersecurity coordinators

Mayorkas said that going forward, the rail companies will have to name a cybersecurity coordinator who will report any incidents and create contingency plans in the case of a cyberattack.

The aviation companies will also be required to appoint a cybersecurity coordinator and report incidents to the DHS’s Cybersecurity and Infrastructure Security Agency.

Similar cybersecurity directives are already in place for 2,300 critical maritime companies that, starting this month, will have to submit plans to identify and address cyber vulnerabilities.

The U.S. Coast Guard is also working with the International Maritime Organization to require that passenger and cargo vessels arriving in U.S. ports have plans to deal with cyber emergencies.

“Whether by air, land or sea, our transportation systems are of utmost strategic importance to our national and economic security,” Mayorkas said.

Spike in ransoms paid

Top U.S. officials, including Mayorkas and FBI Director Christopher Wray, have warned that cyberattacks and ransomware attacks, in particular, have become a persistent threat.

“Last year, victims paid an estimated $350 million in ransoms, a 311% increase over the prior year, with the average payment exceeding $300,000,” Mayorkas told U.S. lawmakers at a hearing last month.

“We’re now investigating over 100 different types of ransomware, each with scores of victims,” Wray added.

U.S. officials have blamed Russia for many of the attacks, saying that despite Moscow’s assurances, they have seen few indications the Kremlin is doing anything to address the problem.

Russian officials deny any role in the recent, high-profile ransomware attacks.

Speaking at a separate cybersecurity forum Tuesday, the head of U.S. Cyber Command warned the problem with ransomware is likely to persist.

“Our adversaries are targeting everyone,” General Paul Nakasone told the Mandiant Cyber Defense Summit. “What was once viewed as criminal behavior has become a national security issue.”

To help facilitate the fight against cyberattacks and ransomware attacks, U.S. lawmakers are considering several bills that would require private companies to report intrusions and attacks on the government.

“We’re optimistic the legislation will pass,” Mayorkas said Wednesday at the annual Billington CyberSecurity Summit.

“I think we’re at a point, seeing the arc of cybercrimes and the cyberthreats, that really there’s an urgency to it,” he said.

 
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Amazon.com Inc.’s livestreaming e-sports platform Twitch said Wednesday that it had been hit by a data breach. It gave no details.

An anonymous hacker claimed to have leaked Twitch data, including information related to the company’s source code, clients and unreleased games, according to Video Games Chronicle, which first reported the news of the hack.

Twitch confirmed the breach and said its “teams are working with urgency to understand the extent of this.”

The company declined to comment further and said ((https://twitter.com/Twitch/status/1445770441176469512)) it would “update the community as soon as additional information is available.” Amazon did not immediately respond to a request for comment.

The hacker’s motive was to “foster more disruption and competition in the online video streaming space,” according to the Video Games Chronicle report.

About 125GB of data was leaked, including information on Twitch’s highest-paid video game streamers since 2019, such as a $9.6 million payout to the voice actors of popular game “Dungeons & Dragons” and $8.4 million to Canadian streamer xQcOW, the report said.

“Twitch leak is real. Includes significant amount of personal data,” cyber security expert Kevin Beaumont tweeted.

Twitch, which has more than 30 million daily visitors on average, has become increasingly popular with musicians and video gamers. They interact with users while live streaming content.

The platform, which was boycotted earlier this year by users for not doing enough to block harassment, previously made a move to ban users for offenses such as hate-group membership and credible threats of mass violence.
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Facebook is in the hot seat again. A recent Wall Street Journal report cites internal knowledge of its harmful effects and the company’s reticence to act. A whistleblower, a former Facebook employee, came out in public this week to testify against the social media company, only adding to the scrutiny. Tina Trinh reports. 

Produced by: Tina Trinh

 
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Key U.S. lawmakers pilloried social media giant Facebook on Tuesday after Frances Haugen, an inside whistleblower who once worked at the company, alleged that Facebook’s products are harming young people, undermining democracy and helping to divide the country politically. 

Haugen, who worked as a Facebook project manager for less than two years, held Facebook Chief Executive Mark Zuckerberg responsible for prioritizing concerns about company profits over controlling online content on its various platforms, including Instagram. 

Haugen testified before the Senate Commerce Subcommittee on Consumer Protection a day after Facebook had encountered hourslong technical issues that left millions of users wondering why they could not access the site and its other platforms such as Instagram and WhatsApp. 

“I don’t know why it went down,” Haugen said, “but I know that for more than five hours, Facebook wasn’t used to deepen divides, destabilize democracies, and make young girls and women feel bad about their bodies” with the posting of glamorous pictures of models, pop singers and Hollywood starlets. 

Democratic and Republican lawmakers, in a rare show of political unanimity in Washington, quickly castigated Facebook and panned Zuckerberg for a recent sailing trip while controversy engulfed his company. They promised to enact tighter controls on social media. 

Democratic Senator Richard Blumenthal of Connecticut contended, “The damage to self-interest and self-worth inflicted by Facebook today will haunt a generation. Our children are the ones who are victims. Teens today looking in the mirror feel doubt and insecurity. Mark Zuckerberg ought to be looking at himself in the mirror.” 

He said, “Big Tech now faces the Big Tobacco jaw-dropping moment of truth.” 

Republican Senator Marsha Blackburn of Tennessee declared that Facebook “is not interested in making significant changes to improve kids’ safety on their platforms, at least not when that would result in losing eyeballs on posts or decreasing their ad revenues.” 

“It is clear that Facebook prioritizes profit over the well-being of children and all users,” she said. 

Other lawmakers accused Facebook of helping to foment the January 6 riot at the U.S. Capitol, when hundreds of supporters of former President Donald Trump stormed into the building to try to prevent lawmakers from declaring that Democrat Joe Biden had won last November’s election. 

Democratic Senator Amy Klobuchar of Minnesota said, “When they allowed 99% of violent content to remain unchecked on their platform, including the lead-up to the January 6 insurrection, what did they do? Now we know Mark Zuckerberg was going sailing.” 

While the hearing was ongoing, Facebook pushed back against Haugen and the onslaught of criticism. It said in a statement that Haugen had no other Facebook employees who reported to her, had never attended a decision-making meeting with top Facebook officials, and had acknowledged in her testimony at least six times she was being asked questions about aspects of the company she had not worked on. 

“We don’t agree with her characterization of the many issues she testified about,” Facebook said. 

“Despite all this,” Facebook said, “we agree on one thing; it’s time to begin to create standard rules for the internet. It’s been 25 years since the rules for the internet have been updated, and instead of expecting the industry to make societal decisions that belong to legislators, it is time for Congress to act.”

Haugen acknowledged that she was the one who provided the documents used in a Wall Street Journal investigation of Facebook. 

Some information for this report came from Reuters. 

 
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Facebook took another pounding in the U.S. Congress on Tuesday and a senator called on federal regulators to investigate accusations by a whistleblower that the company pushed for higher profits while being cavalier about user safety.

In an opening statement to a Senate Commerce subcommittee, chair Senator Richard Blumenthal, a Democrat, said that Facebook knew that its products were addictive, like cigarettes. “Tech now faces that big tobacco jawdropping moment of truth,” he said.

He called for Facebook CEO Mark Zuckerberg to testify before the committee, and for the Securities and Exchange Commission and Federal Trade Commission to investigate the social media company.

“Our children are the ones who are victims. Teens today looking in the mirror feel doubt and insecurity. Mark Zuckerberg ought to be looking at himself in the mirror,” Blumenthal said, adding that Zuckerberg instead was going sailing.

In an era when bipartisanship is rare on Capitol Hill, lawmakers on both sides of the aisle agreed on the need for big changes at Facebook.

The top Republican on the subcommittee, Marsha Blackburn, said that Facebook turned a blind eye to children below age 13 on its sites. “It is clear that Facebook prioritizes profit over the well-being of children and all users.”

Facebook spokesman Kevin McAlister said in an email ahead of the hearing that the company sees protecting its community as more important than maximizing profits and said it was not accurate that leaked internal research demonstrated that Instagram was “toxic” for teenage girls.

Frances Haugen, a former product manager on Facebook’s civic misinformation team, said the company keeps its algorithms and operations a secret.

“The core of the issue is that no one can understand Facebook’s destructive choices better than Facebook, because only Facebook gets to look under the hood,” she said in written testimony prepared for the hearing.

“A critical starting point for effective regulation is transparency,” she said in testimony to be delivered to the subcommittee. “On this foundation, we can build sensible rules and standards to address consumer harms, illegal content, data protection, anticompetitive practices, algorithmic systems and more.”

Haugen revealed she was the one who provided documents used in a Wall Street Journal investigation and a Senate hearing on Instagram’s harm to teenage girls.

The Journal’s stories showed the company contributed to increased polarization online when it made changes to its content algorithm; failed to take steps to reduce vaccine hesitancy; and was aware that Instagram harmed the mental health of teenage girls.

Haugen said Facebook had also done too little to prevent its site from being used by people planning violence.

Facebook was used by people planning mass killings in Myanmar and the Jan. 6 assault on the U.S. Capitol by supporters of then-President Donald Trump who were determined to toss out the 2020 election results.
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An outage has left millions of people around the world unable to use Facebook along with its Instagram and WhatsApp platforms to connect with friends, family and others.

“We’re aware that some people are having trouble accessing our apps and products. We’re working to get things back to normal as quickly as possible, and we apologize for any inconvenience,” the company tweeted Monday.

The outage appears to have started around 11:45 a.m. Eastern time.

Recently, The Wall Street Journal reported that internal Facebook documents showed the company knows about the negative effects of its products yet does little to counter potentially harmful consequences. CBS’s “60 Minutes” program Sunday broadcast an interview with a whistleblower, Frances Haugen, who aired her grievances about the social media giant.

Haugen is expected to testify before a Senate subcommittee on Tuesday.

Facebook says her allegations are misleading.

Some information in this report comes from The Associated Press.
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The whistleblower who shared a trove of Facebook documents alleging the social media giant knew its products were fueling hate and harming children’s mental health revealed her identity Sunday in a televised interview, and accused the company of choosing “profit over safety.” 

Frances Haugen, a 37-year-old data scientist from Iowa, has worked for companies including Google and Pinterest, but said in an interview with CBS news show “60 Minutes” that Facebook was “substantially worse” than anything she had seen before.  

She called for the company to be regulated. 

“Facebook over and over again has shown it chooses profit over safety. It is subsidizing, it is paying for its profits with our safety,” Haugen said. 

“The version of Facebook that exists today is tearing our societies apart and causing ethnic violence around the world,” she added. 

The world’s largest social media platform has been embroiled in a firestorm brought about by Haugen, who as an unnamed whistleblower shared the documents with U.S. lawmakers and The Wall Street Journal that detail how Facebook knew its products, including Instagram, were harming young girls. 

In the “60 Minutes” interview she explained how the algorithm, which picks what to show in a user’s news feed, is optimized for content that gets a reaction. 

The company’s own research shows that it is “easier to inspire people to anger than it is to other emotions,” Haugen said. 

“Facebook has realized that if they change the algorithm to be safer, people will spend less time on the site, they’ll click on less ads, they’ll make less money,” she said. 

During the 2020 U.S. presidential election, she said, the company realized the danger that such content presented and turned on safety systems to reduce it.  

But “as soon as the election was over, they turn them back off, or they change the settings back to what they were before, to prioritize growth over safety, and that really feels like a betrayal of democracy to me,” she said.  

“No one at Facebook is malevolent,” she said, adding that the incentives are “misaligned.” 

“Facebook makes more money when you consume more content. … And the more anger that they get exposed to, the more they interact, the more they consume,” she said. 

Haugen did not draw a straight line between that decision to roll back safety systems and U.S. Capitol riot on January 6, though “60 Minutes” noted that the social network was used by some of the organizers of that violence.  

‘Ludicrous’ 

Earlier Sunday, Facebook dismissed as ludicrous suggestions it contributed to the January 6 riot.  

Facebook’s vice president of policy and global affairs Nick Clegg also vehemently pushed back at the assertion its platforms are toxic for teens, days after a tense congressional hearing in which U.S. lawmakers grilled the company over its impact on the mental health of young users. 

The New York Times reported Saturday that Clegg sought to preempt Haugen’s interview by penning a 1,500-word memo to staff alerting them of the “misleading” accusations. 

Clegg pressed the case in an appearance on CNN. 

“I think the assertion (that) January 6th can be explained because of social media, I just think that’s ludicrous,” Clegg told the broadcaster, saying it was “false comfort” to believe technology was driving America’s deepening political polarization. 

The responsibility for the insurrection “lies squarely with the people who inflicted the violence and those who encouraged them, including then-president Trump” and others who asserted the election was stolen, he added. 

Polarization 

While everyone “has a rogue uncle” or old classmate whose extreme views may be visible on Facebook, Clegg reportedly wrote in his memo, “changes to algorithmic ranking systems on one social media platform cannot explain wider societal polarization.” 

Facebook has encountered criticism that it fuels societal problems, attacks Clegg said should not rest at Facebook’s feet. But he acknowledged that some people may not benefit from social media use. 

“I don’t think it’s intuitively surprising if you’re not feeling great about yourself already, that then going on to social media can actually make you feel a bit worse,” he told CNN. 

He also disputed reporting in a Wall Street Journal series that Facebook’s own research warned of the harm that photo-sharing app Instagram can do to teen girls’ well-being. 

“It’s simply not borne out by our research or anybody else’s that Instagram is bad or toxic for all teens,” Clegg said, but added Facebook’s research will continue. 
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Twitter has appealed a French court decision that ordered it to give activists full access to all of its relevant documents on efforts to fight hate speech, lawyers and a judicial source said on Saturday.

In July, a French court ordered Twitter to grant six French anti-discrimination groups full access to all documents relating to the company’s efforts to combat hate speech since May 2020. The ruling applied to Twitter’s global operation, not just France.

Twitter has appealed the decision and a hearing has been set for December 9, 2021, a judicial source told AFP, confirming information released by the groups’ lawyers.

Twitter and its lawyers declined to comment.

The July order said that Twitter must hand over “all administrative, contractual, technical or commercial documents” detailing the resources it has assigned to fight homophobic, racist and sexist discourse on the site, as well as the offense of “condoning crimes against humanity”.

It also said Twitter must reveal how many moderators it employs in France to examine posts flagged as hateful, and data on the posts they process.

The July ruling gave the San Francisco-based company two months to comply. Twitter can ask for a suspension pending the appeal.

The six anti-discrimination groups had taken Twitter to court in France last year, accusing the US social media giant of “long-term and persistent” failures in blocking hateful comments from the site.  

The groups campaign against homophobia, racism and anti-Semitism.

Twitter’s hateful conduct policy bans users from promoting violence or threatening or attacking people based on their race, religion, gender identity or disability, among other forms of discrimination.  

Like other social media giants, it allows users to report posts they believe are hateful, and employs moderators to vet the content.  

But anti-discrimination groups have long complained that holes in the policy allow hateful comments to stay online in many cases.

 
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Since China’s government declared all cryptocurrency transactions illegal last week and banned citizens from working for crypto-related companies, the price of bitcoin went up despite being shut out of one of its biggest markets.

Experts say large-scale Chinese miners of cryptocurrency — the likes of Bitcoin and Ethereum — will take their high-powered, electricity-guzzling servers offshore. Exchanges of the digital money and the numerous Chinese startups linked to the trade also are expected to rebase offshore after dropping domestic customers from their rosters.

The shift highlights how virtual currencies can evade government regulation.

“The exchanges have been pushing offshore anyways, and with the exchange business you need cloud infrastructure, you need developers, you need management to move things in the right direction, and so whether that is sitting in Taipei, San Francisco, Singapore or Shanghai, it doesn’t really matter — those businesses are very virtual,” said Zennon Kapron, Singapore-based founder the financial consulting firm Kapronasia.

“The real impact we’ve probably seen though is in the miners, and most of those miners [are in] the process of shifting overseas or [have] already completed moving overseas,” he said.

Strongest anti-crypto action to date

On Sept. 24, the People’s Bank of China, Beijing’s monetary authority, released a statement saying cryptocurrencies lack the status of other monetary instruments. The notice, issued in tandem with nine other government agencies, including the Bureau of Public Security, declared all related business illegal and warned that cryptocurrency transactions originating outside China will also be treated as crimes.

Explaining the ban, China’s official Xinhua News Agency reported Friday that cryptocurrencies have disrupted the controlled economy’s financial systems and contributed to crimes such as money laundering.

Cryptocurrencies — digital commerce tools that aren’t linked to a centralized banking authority — first appeared in China around 2008. Chinese banks began to prohibit the use of digital currencies in 2013 and stepped up regulations after 2016.

China was the world’s biggest Bitcoin miner and supported the largest exchange by volume, according to the news website CryptoVantage. It says many of those who suddenly made millions when Bitcoin prices soared four years ago were in China.

Chinese miners and traders head to Singapore

The Chinese ban carries penalties for international exchanges that do business with people inside China, and news reports indicate international crypto exchanges are trying to cut ties with Chinese clients in recent days. But the companies themselves are largely staying quiet.

A spokesperson for digital currency exchange Coinbase said Wednesday it does not “have anything to share at this time” about the crackdown in China. U.S.-based Worldcoin Global, a new type of cryptocurrency, did not reply to a request for comment.

China’s growing pressure on crypto over the past few years had prompted stakeholders to leave the country, Kapron said, adding that less than a quarter of the country’s original cryptocurrency peer-to-peer lending startups — small firms that connect individual lenders and borrowers — remain in China.

Mining for digital currency — the process of using computers to enter bitcoins into circulation and verify cryptocurrency transactions in exchange for a payout — should get easier overseas as Chinese exit the market, Kapron said.

Smaller operators, he added, may be able to mine more easily without the competition of giant Chinese operations.

Singapore looms as a prime go-to place for operations that need not be physically onshore. The country had accepted about 300 cryptocurrency license applications as of July. From China, e-commerce giant Alibaba as well as digital financial firms Yillion Group and Hande Group have applied, news reports in Asia say.

Other Asian countries lack the legal welcome mat that Singapore has extended, said Jason Hsu, vice president of the Taiwan Fintech Association industry group.

“Where would that money flow to? I think it’s a question that needs to be answered,” Hsu said. “I think in Asia, Singapore would be a destination for them to go to. Singapore obviously has the clearest regulations and also wants to attract more digital fintech [financial-technology] companies.”

Outside Asia, Amsterdam and Frankfurt are “establishing their footprint as international centers” for financial technology, said Rajiv Biswas, Asia Pacific chief economist with market research firm IHS Markit. Financial technology covers cryptocurrency.

Western Europe ranked this year as the world’s biggest crypto economy in the world with inflows of more than $1 trillion or 25% of all global trade, activity, news and data service Chainalysis says. Europe’s surge follows similarly rapid growth in 2020.

Eventual resurgence for crypto in China?

Authorities in China are targeting crypto now as part of a wider “crackdown on overnight riches” and to “clean out the wild, wild West,” Hsu said, referring to largely unregulated market sectors. The trade will go underground for now, he forecasts, and China will eventually come out with an official digital currency issued through major banks.

Several countries are considering adopting new digital currencies that would allow people to exchange money without an intermediary, such as a bank. Proponents argue these currencies could capture the benefits of cryptocurrencies that make exchanging money easy, but without the price volatility of decentralized digital assets like bitcoin.

Chinese authorities may eventually swing to a more tolerant view of non-state-sanctioned digital currencies, though subject to strict criteria on what’s legal or otherwise, said Song Seng Wun, economist in the private banking unit of Malaysian bank CIMB. Blockchain, the core technology behind the public transaction ledger that makes crypto commerce transparent, could continue to develop in China for other ends, he added. 

 
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During the three-day World Internet Conference held in Wuzhen, China, this week, the country’s biggest tech tycoons rushed to show their support for Beijing’s “common prosperity” initiative.

Their enthusiasm for the initiative comes amid a yearlong crackdown on the country’s tech industry, where several high-profile companies have faced investigations and fines. Formerly high-flying celebrity CEOs are now keeping a low profile.

Daniel Zhang, CEO at e-commerce giant Alibaba group, said his company’s donation of $15 billion to the initiative over the next five years represented its willingness to help China achieve its goal of prosperity for all.

Zhou Hongyi, billionaire entrepreneur and chairman and CEO of the country’s largest Internet security firm, Qihoo 360, said his company will donate an as yet undisclosed sum to the initiative and step up to help smaller firms thrive.

Stressing the need to develop these enterprises, Zhou said, “Our success depends on our country’s policies. … We must take the initiative to align our development with our national strategies and serve our country with science and technology.”

Lei Jun, CEO of consumer electronics manufacturer Xiaomi, said that technological development must be used to achieve social good and that tech companies should help build a good life for everyone.

Other tech giants, such as technology conglomerate Tencent, online agricultural marketplace Pinduoduo and food delivery platform Meituan, answered Beijing’s call before the Sept. 26-28 gathering, pledging financial support for social causes.

‘Common prosperity’ initiative

During his first eight years in office, Chinese President Xi Jinping occasionally mentioned the term “common prosperity.” Since February, when he declared China had eliminated poverty, “common prosperity” has become one of his favorite themes.

At a meeting of the Communist Party’s Central Committee for Financial and Economic Affairs on Aug. 17, Xi stressed that those who are already rich need to guide and help others achieve prosperity.

“Common prosperity means prosperity for all, not just a few people,” Xi said, according to a meeting note published by China’s state-run Xinhua News Agency. “We can allow some to get rich first, but we must then launch a scientific public policy to make sure every citizen can have their fair share.”

Central to achieving common prosperity is a concept known as the three distributions, first introduced by the Chinese economist Li Yining in the 1990s.

According to the explanation from China’s National Development and Reform Commission, the first distribution of wealth comes through market competition. The second is achieved through the state via taxes, subsidies and social welfare programs. The third distribution taps enterprises and individuals to redistribute their wealth through voluntary donations.

‘Third distribution’

“The target of this round of the common prosperity initiative is the wallet of wealthy domestic entrepreneurs,” said Lu Jun, founder of the influential nongovernmental organization Beijing Yirenping Center, in a phone interview with VOA Mandarin. His NGO focuses on eliminating discrimination and defending the rights of disadvantaged groups.

Wang Hsin-Hsien, a political science professor and chair of the East Asian Studies Institute at National Cheng-Chi University in Taiwan, told VOA Mandarin that businesses are essentially forced to make charity donations under the current system.

“China’s current common prosperity initiative is controlled by the party-state. That means large enterprises must make donations in order to show that they are choosing the right side. So I don’t think these donations will be voluntary,” he told VOA Mandarin via phone.

“This is not the charitable donation we see in Western countries, because eventually the money will be returned to the state for redistribution,” he added.

Meanwhile, analysts say this new wave of donation will not likely help boost China’s civil society.

NGOs under microscope

China has been tightening its grip on NGOs since 2016, demanding they provide specific funding sources and membership information or face being banned.

This year, China announced a new wave of crackdowns targeting NGOs. In May, the Ministry of Civil Affairs started to target “illegal NGOs with measures such as limiting their access to conference venues, publicity resources and manpower,” according to the state-owned news outlet China Daily.

“The moves were part of a sweeping campaign launched last month by the ministry and 21 other central agencies to clamp down on the unregistered NGOs, which have masqueraded as foundations, industrial associations and other nongovernmental groups to rake in money from the public,” China Daily said.

Lu told VOA Mandarin that the NGOs that can survive or get funding will be those that align their goals with the government’s agenda — unlike many NGOs outside China, whose views diverge from those of the government.

“I don’t think this is necessarily good news for NGOs, as I believe the money donated by private companies will go to the government-run or government-affiliated NGOs,” he said of the third distribution.

“Beijing won’t allow companies to donate to independent NGOs freely, let alone the ones they don’t like, such as NGOs working on human rights, labor rights and women’s rights.”  

 
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