President Trump’s sanctions on WeChat, the Chinese social media and e-commerce app, may feel more distant to Americans than the battle over TikTok. But the WeChat measures strike closer to the heart, targeting a product tied to every part of economic and social life in China.
The sanctions announced Thursday mark the first time the U.S. has sought to fight China’s Great Firewall by building its own virtual wall. Until recent months, such a countermove seemed unfathomable, with U.S. tech companies reluctant for their government to go wall-for-wall with Beijing due to risk of retaliation.
U.S. authorities have yet to clarify whether they will consider individuals using WeChat a “transaction” with the company — the term the executive order uses — or if the sanctions are limited to business deals. It’s also unclear how much of Tencent’s sprawling international business — it’s the world’s largest gaming company by revenue — will be considered “related” to the WeChat app and subject to sanctions.
What is clear, however, is the Trump administration is targeting a service at the very heart of Chinese social life, commerce and cross-border business.
“WeChat is not just a chat app,” said Danielle Cave, deputy director of the Australian Strategic Policy Institute’s International Cyber Policy Center. “It is really one of the world’s few ‘all-in-one’ super apps, in that users rely on it for their news, to pay their bills, to book their travel and shop online.” The ban is likely to trigger wide-ranging consequences across sectors, she said.
U.S. companies are bracing for potential retaliation, said James Zimmerman, a Beijing-based attorney and former chairman of the American Chamber of Commerce in China. He called the timing of the ban an election move by Trump, who trails presumptive Democratic nominee Joe Biden in polls, and said U.S. industry did not lobby for it.
“Most [American] tech companies are stunned by this,” Zimmerman said.
Tencent’s stock, listed in Hong Kong, plunged by more than 10% on Friday — wiping out more than $40 billion in market value — before paring losses to trade 4.4 percent lower.
Trump’s executive order invoked Chinese authorities’ use of WeChat for surveillance as the reason for the ban.
“Like TikTok, WeChat automatically captures vast swaths of information from its users,” the order said. “This data collection threatens to allow the Chinese Communist Party access to Americans’ personal and proprietary information.”
Chinese Foreign Ministry spokesman Wang Wenbin said Friday that Beijing was firmly opposed to the U.S. action and warned that it would defend the rights of Chinese businesses. Tencent did not immediately respond to a request for comment.
WeChat is not an isolated service like TikTok. It’s an integral part of daily life in China, used for everything from hailing taxis, to ordering fast-food delivery, to reading news — to checking if Covid-19 cases had been confirmed in your neighborhood as the pandemic spread this year. The app has largely replaced phone calls and text messages. It’s increasingly replacing email as a way to send documents, and business cards as a way to connect with professional contacts.
WeChat ranks No. 2 in mobile payments in China, behind Alibaba’s Alipay, with more than one-third of the country’s digital payments made through the platform. Its Facebook-like social feeds are a mandatory read for executives, with government agencies and companies using it to break news.
The WeChat sanctions come as U.S. public opinion has strengthened this year in favor of stronger measures against China’s propaganda reach, despite the risks of retaliation for American companies. China’s new security law in Hong Kong has played a role, with American audiences watching the former bastion of free speech changing overnight into a city like any other in China, where political dissenters are hauled to jail.
Google said Wednesday that it terminated more than 1,000 YouTube accounts in June that were connected to “coordinated influence operations linked to China.” Twitter announced Thursday it would begin labeling accounts operated by governments or state-controlled media.
“We will also no longer amplify state-affiliated media accounts or their tweets through our recommendation systems,” Twitter said in a statement.
WeChat has made limited inroads in Western markets due to privacy concerns, despite Tencent saying data for international users is stored overseas. At home, Chinese authorities rely on WeChat for surveillance of political dissidents, some of whom have been sentenced to prison based on their posts on the platform.
Researchers say WeChat remains by far the most popular source of news in Chinese immigrant communities and, like Facebook, can be susceptible to disinformation. Controversies have erupted in recent years in Chinese communities in New York and elsewhere over the spread of fake political news on WeChat.
Research by the Citizen Lab at the University of Toronto has shown that the company employs an advanced censorship filter based on keywords that is far more stringent for users in mainland China compared with those abroad.
But Chinese Americans in the United States, for instance, have complained about having their accounts shut for discussing last year’s Hong Kong protests.
Wang Yuan in Beijing contributed to this report.