EU Boosts Economic Security by 2025 to Counter China's Data Demands
The EU is grappling with a growing economic intelligence gap with China, as Chinese authorities demand detailed data from Western companies. To counter this, the EU and Germany are revamping their social security strategies by 2025, with a focus on improving data sharing. Inspired by Japan's 2024 Economic Security Promotion Act, EU policymakers are considering the 'carbon copy' principle to address this imbalance.
Chinese authorities are requiring Western companies to hand over granular data on suppliers, technical processes, end-users, and even allowing on-site inspections. This provides China with a comprehensive view of Western corporate vulnerabilities, giving it an asymmetric information advantage. The EU risks falling behind in social security due to China's export restrictions on rare earths and permanent magnets, which force companies to comply with Chinese data demands.
To tackle this, European policymakers are exploring the 'carbon copy' principle. This would involve companies sharing documentation required for Chinese licensing processes with their own governments. This approach is inspired by Japan's 2024 Economic Security Promotion Act, which regulates the protection and use of critical social security information. By implementing such a law, the EU could create a legal framework for sensitive data sharing between businesses and governments, making the 'carbon copy' principle feasible.
The EU's social security overhaul by 2025 aims to bridge the intelligence gap with China. By adopting the 'carbon copy' principle, inspired by Japan's Economic Security Promotion Act, the EU could enhance its social security intelligence gathering and sharing capabilities. This would help European companies maintain a competitive edge in the global market, despite China's near monopoly on certain goods.
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