It may be intensely annoying to those of us in the western world to admit it, but China’s systematically eating our lunch when it comes to exploiting data: gathering it, analyzing it, and using it for competitive, military, strategic and geopolitical advantage. My hat’s off to them.
The Wall Street Journal reports (bold, underlined text is my emphasis):
China’s expanding grip on data about the world’s cargo flows is sparking concern in Washington and among industry officials that Beijing could exploit its logistics information for commercial or strategic advantage.
Even cargo that never touches Chinese shores often still passes through Beijing’s globe-spanning logistics networks, including through sophisticated data systems that track shipments transiting ports located far from China. Control over the flow of goods and information about them gives Beijing privileged insight into world commerce and potentially the means to influence it, say cargo-industry officials.
With ports clogged globally and shortages plaguing many industries, shipping data has become an enormously valuable commodity.
Foremost among China’s cargo-data systems is Logink, a digital network that links shippers internationally and describes itself as a “one-stop logistics information service platform.” Logink says it draws on a mix of public databases and information input by more than 450,000 users in China and at dozens of giant ports world-wide, including across the Belt and Road initiative, China’s trillion-dollar international infrastructure project, and as part of what Beijing calls the Digital Silk Road.
Logink’s international reach highlights a field critical to the world economy where the West lags behind China … Logink’s window into global trade “could give the data holder a treasure trove of intelligence of national security and economic interest,” said Michael Wessel, a commissioner on Congress’s U.S.-China Economic and Security Review Commission, which last week launched a study of the system.
“It should be a much higher concern than it has been,” Mr. Wessel said.
The Defense Department sends military equipment via commercial ports world-wide. A spokesman for its logistics arm, Transportation Command, said that through Belt and Road, “China is seeking to enhance its visibility into the global supply chain, including U.S. military logistics.”
. . .
Concerns about Logink are similar to those around Chinese telecommunications companies Huawei Technologies Co. and ZTE Corp. : They all carry other parties’ data that Chinese authorities could exploit to China’s benefit or to the detriment of those who communicate over the networks. By crunching data crossing Logink, China could spot and exploit shortages, gluts and trends before others do, say industry officials.
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“In logistics today, the flow of information is as important as the flow of money or goods,” said Inna Kuznetsova, a logistics expert and chief executive of data-analytics company 1010Data in New York.
. . .
“Logink is a masterpiece in technical innovation and would be the envy of other platforms,” said Andre Wheeler, a former logistics executive based in Perth, Australia, and now a consultant, who has analyzed Logink for several years. He estimates Logink is a decade ahead of rival systems, which makes it attractive for other countries to link with, “as they can leapfrog the technical development cycle.”
. . .
Isaac Kardon, an assistant professor at the U.S. Naval War College, said Logink’s mix of data processing with sea shipping, all on a global scale, fits with China’s mix of high- and low-tech to strengthen its geostrategic position. “If you control the information, you can move things around without others knowing, or jumble up someone else’s information,” he said.
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Logink’s management by the Chinese government, deeply involved in its nation’s corporate activities, “changes the dynamic,” said E2open Executive Vice President Pawan Joshi. “It’s difficult for free enterprises to compete with an incorporated nation.”
There’s more at the link.
As I said, full marks to China for having the strategic vision to see how this system could benefit it in many areas, and for devoting the time, resources and attention needed to build and propagate it. I may not like anything to do with Communism, but let’s face it: this is a major, major achievement, one that deserves respect, no matter how reluctant we may be to grant it. Even if the USA and Europe started to build a rival system today, it’d take a decade or more to get it up and running, and in that time China would move even further ahead.
I think this is going to be a critical area of geopolitical influence and geostrategic operations in the years to come; yet, for most people, it’s entirely below the surface of international relations, invisible and ignored. That needs to change at once, if not sooner . . . but do our diplomats, politicians and leaders have the vision to see that and do something about it? I fear they don’t.