The Social Credit System in China (SoCS) is a government-operated, data-powered set of technological tools to monitor, assess, and shape the behaviour of citizens and enterprises through scoring, rewards and punishments in a decentralised way. It has been developed by the central government to improve trustworthiness when engaging in economic activities, limit the excesses that came out with the liberalisation of the economy in the last decades, regain control of over the corruption within the bureaucracy, suppress rebellious movements or react to humanitarian crisis that pose a national risk, and enhance social cohesion and control in a globalised world.
The government in Beijing designs the guidelines of the SoCS, but it is the local governments that decide the scope of its social enforcement. Certainly, around 80% of provinces, regions and cities have introduced different sorts of scores, rewards and punishments, but these have been applied to companies and organisations mostly. Nevertheless, it is very common for the central government to counteract local proposals when “they have gone too far in violating personal freedom”. Despite being highly criticised in western countries for violating human rights, the SoCS has broad support (around 70%) among Chinese citizens by addressing many concerns regarding social cohesion, trustworthiness in public and private entities, and national security.
Since China implemented market reforms in its economy since the 80s, both local and foreign businessmen often complained that it was difficult to engage in trustworthy commercial transactions with potential partners, spending considerable resources to detect fraud. It was first at the Congress of the Chinese Communist Party in 2002 when a “unified, open, competitive and orderly modern market system,” with credit scores for different actors was discussed. Eventually, current president Xi Jinping made this a priority in his plan to fight corruption and “the excesses of capitalism” and a broad system of social and financial credit scores was launched in 2014. The goal was to create a more harmonious and stable society, increase public safety, strengthen trust between individuals and businesses, and reduce fraud and corruption. Then, in 2017 President Xi Jinping highlighted the concept of “automating” social management to improve the capability to predict and prevent security risks, especially terrorist plans from the separatist Uyghur islamic groups”. Later on, the COVID-19 pandemic was used as an opportunity to cement the importance of social credit, as relief measures explicitly linked to social credit records. Since then, the Chinese state has prioritised the use of the SoCS in order to advance its goals on human security as a strategy to ensure international growth while keeping political control at home.
Technology is not neutral and is influenced by power structures, particularly economic and political systems. Indeed, in order to maintain its autocratic regime, the Chinese state wants to probe the viability of big data surveillance as a substitute for independent and accountable institutions, such as banks, courts, and transparent bureaucracies, that have traditionally been considered to be prerequisites for long-term development according to liberal theories. Furthermore, traditional Confucian philosophy in China values morality over respect for individual rights as the guiding principle for interpersonal relationships and the government of a society. And very importantly, Chinese society is no stranger to arbitrary and extended forms of surveillance because since the Mao era, the Chinese government has kept “dang’an”, an opaque register on millions of its citizens. Therefore, an intrusive program like the SCS may feel less objectionable to the Chinese public than in western societies.
Data extraction to gain control on off-line activities is a cornerstone of “surveillance capitalism”, a regime which China has embraced after the era of Mao Tzetung. In that sense, the SoCS is one the best tools for the Chinese state in order to improve social trust, financial robustness, and economic development and capabilities in fighting national and international security threats while strengthening its political legitimacy. The SoCS collects data through a mass surveillance network of 400 million cameras, facial recognition, private mobile operators and financial entities to track online behaviour, and using AI to estimate potential negative outcomes. The SoCS is decentralised and targets mainly business and organisations as around 75% of them in China have been targeted by the SoCS, whereas only 10% of citizens have a social score.
This suggests that the system is focused mainly in improving the trustworthiness within the commercial, financial and governmental sector than punishing individuals. Indeed, businesses are placed on a blacklist if they pursue anti-competitive, damage the environment, or commit fraud. Conversely, companies will be put on a “red list” if they set up social programs, donate to charitable causes, or engage in any corporate social responsibility activity. An example of this “stick and carrot system” is that the General Administration of Customs performs significantly lower customs inspection rates for enterprises in the red list than on the black one (2% vs. 85%, respectively). According to many polls, the SoCS has made it easier to do business in China since 2014 when it got an overall score of 61/100 compared to 75 in 2023.
Moreover, the standardised mechanism of the SCS may help reduce the perceived level of arbitrariness and corruption of public agencies and thus improve governmental integrity. However, data from Transparency International shows that the perception of corruption has increased since 2014. But, the most criticised part of the SoCS is that the Chinese state has used it by collecting DNA samples, monitoring electricity consumption, and tracking people going on Islamic pilgrimages to suppress the separatist and terrorist movements in the autonomous and Muslim Uighur-populated western region of Xinjiang. By enforcing the SoCS, around 1 million Uighurs are being held in detention camps by the Chinese state according to the UN. Terrorist attacks from separatists have indeed diminished, but at the cost of violating human rights that has provoked massive criticism around the world.
Different polls have found a high degree of support (shown in parenthesis) for the SoCS when: disqualifying people with poor records from civil service candidacy (78%) and restricting their travel (77%), spreading rumours online (74%), domestic violence (71%), and restricting job promotions (68%). However, support for surveillance is lower for protesting or petitioning the government is 49%, restricting one’s child’s entry into private schools (42%) and limiting internet use (48%). This broad support for intrusive technological tools to fight against corruption and fraud by businesses and bureaucrats and preserve national security is relevant as it suggests that the SoCS fulfils its purpose of boosting trustworthiness, preventing crime and promoting social cohesion. Nevertheless, citizens are not willing to be “fully controlled” by the government, and when local governments, which are in charge of enforcing in their own way the SoCS, get too intrusive, the central government in Beijing steps-in and blocks its implementation.
In order to achieve its social and economic goals without undermining its one-party system, the ruling CCP has been investing since 2014 in expanding the SoCS through a data-based platform called the National Credit Information Sharing Platform. This platform uses providers such as the People’s Bank of China, Ali, Baidu and Credit China to collect information and publish it in a portal called “Credit China”. This is coordinated by the State Council, the National Development and Reform Commission (NDRC), the Ministry of Finance, the Central Bank, and The People’s Bank of China. On the opposing side, many voices in the western world have labelled this system as “authoritarian” and “dystopian” which affects human rights. Moreover, with globalisation and more Chinese citizens travelling abroad, a critical perspective on how intrusive the SoCS might be spreading in China, but this opposition remains fragmented and at an individual level.
The Chinese state believes that the SoCS will increase social cohesion and stimulate the economy while keeping an authoritarian regime. Chinese officials also state frequently that terrorist attacks in western countries could be attributed to their government's "excessive emphasis on human rights above security”. Citizens who support the SoCS cite fighting bureaucratic corruption and enforcing discipline among unruly segments of the population as positive features of it.
But, a few Chinese scholars have published their criticism of the SoCS in state media and universities suggesting that the SoCS violated the "rule of law", as punishments came for actions without a judicial process. Caixin media group, based in Beijing, has also warned that the SoCS was insufficient in deterring problematic business activities and that the social credit system was easy to manipulate in favour of certain businesses. And lastly, many international NGOs and Muslim groups in the Xinjiang region claim that the oppressive nature of this surveillance system is undermining social cohesion and thus do not believe in the SoCS producing human security.
At the national level, the government has expressed its wish to keep the financial/corporate and social ratings as separate as possible. But, it has let the local governments take the initiative to make them interdependent, such as punishing individuals that cross on a pedestrian red light by diminishing their chances to buy travel tickets, their children entering certain universities or get a bank loan.
The SoCS is definitely a priority for the Chinese state for the coming years, as the National Development and Reform Commission unveiled a plan in June 2024 to further develop the country's social credit system to accelerate the legislation related to the social credit system and regulating the procedures for utilising credit information. The results of the SoCS are mixed. On one hand, the government has succeeded in increasing the thrust when doing business, a majority of the population supports the implementation of SoCS towards businesses and public agencies, it has been a tool to decentralise the power as it is the local governments that decide the scope of which individuals should be targeted by it, and it has suppressed terrorist groups by using this technology. On the other hand, perception of corruption has not diminished and there is a massive violation of human rights in the Xinjiang region by using the SoCS. However, it is true that the SoCS is not that totalitarian as voices coming from western power want to portray it.
Comments