Chinese Telecom Giant ZTE ‘Helped Venezuela Develop Social Credit System’

November 20, 2018 8:34 AM
CARACAS - Chinese telecom giant ZTE assisted Venezuela in the development of a new smart card as part of a program similar to China’s controversial social credit system, according to a Reuters report.
 
Key points:
 
In China’s current social credit system, good behaviour can earn citizens discounts, while bad marks can limit aspects of their lives
Many in Venezuela are concerned the new card system is an attempt to tighten social control through monitoring aspects of daily life
Reuters reported ZTE had been heavily involved in the development of the new card system
 
Venezuela’s new smart card — known as the “fatherland card” — collects a range of information about cardholders and stores it in a state database, which the Government claims will help them provide better services to citizens.
 
The database, according to employees of the card system and screenshots of user data reviewed by Reuters, stores a range of details including medical history, presence on social media, membership of a political party and whether a person voted.
 
But many in Venezuela are concerned the card is an attempt to tighten social control through monitoring all aspects of daily life, similar to that of China’s social credit system, which grades citizens based on behaviour including financial solvency and political activity.
 
There were also concerns that Venezuelan President Nicolas Maduro could use the information to stifle political opponents.
 
Reuters reported ZTE had been heavily involved in the development of the new card system.
 
As part of a $96 million government effort to bolster “national security”, Venezuela last year hired ZTE to build the “fatherland” database and create a mobile payment system for use with the card, according to contracts reviewed by Reuters.
 
A number of ZTE specialists were also stationed within the state telecommunications company, Caracas, to help with the running of the system.
 
Su Qingfeng, the head of ZTE’s Venezuela unit, confirmed that ZTE was developing the mobile payment application and sold Caracas servers for the database, adding ZTE was simply developing their market.
 
Since announcing the card last year, Venezuelan President Nicolas Maduro has offered cash prizes and cheaper fuel, groceries and medical services in a bid to get people to sign up.
 
As many as 18 million people, over half the population, already have, according to government figures.
 
'What we saw in China changed everything'
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Video: Surveillance software identifies details about people and vehicles in Beijing.(Photo: Reuters/Thomas Peter) (The World)
 
Reuters’s report said in 2008 former Venezuelan president Hugo Chavez sent a delegation to Shenzhen, a hub for Chinese technology innovation, to visit ZTE and observe the inner workings of China’s national identity card program.
 
Anthony Daquin, who was a member of the delegation, said the original intention from Chavez was for the information to help the government provide identification credentials for the millions of Venezuelans who lacked basic documentation.
 
But he said the delegation were amazed by what they saw and quickly realised the wider implications of the Chinese technology.
 
“What we saw in China changed everything … they were looking to have citizen control,” Mr Daquin said, adding he was fearful of the implications for the privacy of Venezuelans.
 
LEAVE NO DARK CORNER
China is building a digital dictatorship to exert control over its 1.4 billion citizens. For some, “social credit” will bring privileges, for others, punishment, as Matthew Carney reports.
 
He said the delegation learnt how Beijing was using smart cards as part of a system that would allow Beijing to monitor everything from a citizen’s personal finances to medical history and voting activity.
 
In China’s current social credit system, good behaviour can earn citizens discounts on utilities or loans, while bad marks can get them banned from public transport or their kids blocked from top private schools.
 
Russia is also developing a similar system, with officials claiming that 80 per cent of Russians will have a “digital profile” by 2025, with every achievement in a person’s life set to be recorded in a database.
 
Mr Daquin said when he raised his concerns with Venezuelan officials about the technology he was detained, beaten and accused of treasonous behaviour, forcing him to flee the country.
 
Spokespeople for the Venezuelan Government provided Reuters with no comment on Mr Daquin’s account or on the article’s claims about ZTE’s involvement in the smart card production.
 
China and Venezuela have a close relationship, with Beijing providing billions in aid funding as the country endures a catastrophic economic crisis.
 
A woman is seen feeding children as they wait to cross the border.

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