SINGAPORE (Jan 15): For years, Chinese internet companies such as Tencent Holdings, Alibaba Group Holding and Baidu have had an unfair advantage over their Western counterparts such as Google parent Alphabet, Facebook and in that China’s lax privacy rules have allowed the country’s tech companies to harness Big Data and artificial intelligence (AI) a lot more powerfully.

To be sure, the Chinese do not mind being watched all the time because they have lived under state observation for generations. Beijing keeps dang’an, a file on every Chinese with data that includes school grades, traffic violations or reports from local neighbourhood watches. The advent of smartphones and instant messaging has just made monitoring people and gathering personal data a lot easier. Over the years, Beijing has tried hard to strike a balance between harnessing the internet for economic growth and using it as a security tool.

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