Elon Musk and China, dangerous links for American security?

Elon Musk’s offer to buy Twitter is troubling America’s national security experts, according to the Washington Post. In question: the links between the Tesla group, which belongs to the multimillionaire, and China. According to them, this operation risks turning Twitter into a megaphone for Beijing’s anti-American propaganda.

When Elon Musk confirmed, in mid-April, that he wanted to acquire Twitter in the name of “freedom of expression”, some already saw the ghost of Donald Trump returning to join the popular social network. Others fear another shadow… China, which will benefit from the ascension of the Tesla and SpaceX boss to the head of Twitter. This acquisition could be a “threat to American national security”, so assured a dozen former and current members of the administration, responsible for controlling foreign investments in the United States, interviewed by the Washington Post, Thursday June 2 .

“Given the amount of information, the number of influential users and the amount of sensitive personal data that Twitter has, any possible foreign influence on this operation will be closely watched,” assured the Washington Post, Richard Sofield, who worked on Committee for Foreign Investment (CFIUS) during the presidency of Barack Obama and Donald Trump. CFIUS has also begun to take an interest in the ramifications of this transaction abroad and more specifically in China, underlining the daily from the East Coast.

The gigafactory in China, Tesla’s Achilles’ heel?

The concern is mainly about the links between Tesla and China. The Committee for Foreign Investment is not the first to sound the alarm: Jeff Bezos, the CEO of Amazon, wondered that on April 26 if “Beijing didn’t just get some action in our village square [Twitter] thank you for this offer”. But, at the time, observers saw it more as a low blow from one of its main competitors in the space race. Jeff Bezos, boss of Blue Origin, was understandably upset the red rag of China, knowing that the American administration is very touchy on the issue.

Still, it’s hard to downplay Tesla’s hopes in China. “In 2019, Tesla became the first non-Chinese company to own 100% of its factory in China and Elon Musk took the opportunity to build a giga-factory that works well”, recalls Jean-François Dufour , company director. DCA China-Analysis Consulting.

Beijing also rolled out the red carpet for the American businessman by giving him “settlement aid worth several billion dollars through concessional land, low interest rate loans and tax breaks ,” the New York Times recalled.

In return, Elon Musk made this factory the rear base for his expansion, not only in China, but throughout Asia. Proof of the importance of this site for the world number 1 in electric cars: in 2021, more than half of the cars produced by Tesla in the world will be assembled precisely in this factory. The Chinese market alone brought in more than 13 billion dollars for the American brand, or more than a quarter of its revenue, the Wall Street Journal details.

Profits that could quickly become Tesla’s Achilles’ heel if Beijing decides to use it as leverage. “The authorities may severely restrict the access of Tesla vehicles to the Chinese market if Elon Musk comes to frustrate them in one way or another,” said Jean-François Dufour.

A precedent in 2019

Such a scenario is not too surprising: in 2019, Beijing asked Tesla not to send data collected by its connected cars to Chinese users in the United States. Under pressure, Elon Musk’s group opened a data center in Shanghai two years later. The battle for control of personal data reflects, according to Jean-François Dufour, “Beijing’s desire to mark its territory and reassert its authority over foreign actors present on its territory”.

And then Elon Musk saw how vindictive Beijing can be to companies that don’t stroke the regime by the hair. Thus, the H&M brand found itself banned from the Internet in China [et des tout-puissants sites d’e-commerce comme Alibaba] because of the decision, in 2021, to no longer use cotton from the Xinjiang region, where Beijing has been accused of using forced labor in the cotton fields.

Moreover, Tesla’s “giga-factory” in Shanghai is not the only source of economic hope in China. The same goes for the production of electric motors with which the cars of the American group are equipped. In a May 2022 report on the components used to make its vehicles, Tesla said most come from Chinese suppliers and rely on raw materials primarily mined in China or by Chinese groups.

“Tesla is no more dependent on these Chinese suppliers than any other electric car manufacturer, but given the influence of Elon Musk, Beijing may be more tempted to use this weapon against Tesla than against General Motors or General Motors. Volkswagen”, summarizes Jean-François Dufour.

Aware of the implications of this dependency, Tesla raised the possibility of entering the mining industry, but “it will take more than seven years to achieve this”, estimates Gavin Montgomery, raw materials specialist for the American firm, Wood Mackenzie. , interviewed by the Washington Post.

A Trojan horse from China for what?

The fear of the American authorities to see Elon Musk become a Trojan horse of China, if he buys Twitter, also comes from the fact that “the businessman always has a positive speech regarding China and its interests”, said Jean-François Dufour. So he accepted without hesitation that Beijing would close its factory in Shanghai during the lockdown in China’s economic capital in March. However, Elon Musk cried out when California authorities made a similar decision at his factory in Fremont at the beginning of the pandemic, in April 2020. He even threatened to move all his production to Texas.

>> Also read in France 24: Covid-19: Elon Musk reopens his Tesla factory and challenges the American authorities to stop it

Therefore, China has the means to get preferential treatment from Elon Musk. But how does this pose a risk to US national security? First, “an obvious problem is access to the personal data of Twitter users,” a former adviser to Barack Obama, who preferred to remain anonymous, told the Washington Post.

“It is clear that China will take advantage of this situation to request information on all those who criticize Beijing on Twitter”, many in the New York Times, Murong Xuecun, a Chinese writer who was questioned by the Chinese authorities in 2019 after two critical that tweet towards Chinese President Xi Jinping.

“If Twitter is banned in China, it is because Beijing recognizes that it can be a powerful tool of influence”, summarizes observes Jean-François Dufour. And according to the expert, the Chinese regime intends to use it more freely if Elon Musk actually takes the reins of the social network: “the fear is that Twitter will become a global megaphone for Chinese propaganda”, says this expert.

The Chinese have mastered the art of spreading their propaganda on social media, usually to criticize the United States. But Twitter has so far tried to reduce this disinformation by shutting down fake accounts that are only used to reinforce official Chinese discourse, the Wall Street Journal recalls. And the vision of “total freedom of expression”, which Elon Musk has openly defended, will marry very well with Chinese ambitions to take their message high and far on the international scene.

The authorities lack the means to prevent this takeover in the name of national security. The Committee for Foreign Investment does not intend to block an operation between two Americans, which is the case with Twitter and Elon Musk. Their only hope is that the Tesla boss finally decides that being the head of the tweeting empire no longer interests him.

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