President Donald Trump, last week, signed an executive order banning WeChat in the United States. The order banned any US transactions with the Chinese owners of this app, saying that the US needs to take aggressive action for the sake of national security. This ban comes into effect in 45 days.
What is WeChat?
WeChat, or Weixin in China, is an extremely popular social media platform. For many Chinese people, this app is the best and easiest way to stay in touch all over the world.
Owned by Tencent (TCEHY), a Chinese tech company, the app has nearly 1.23 billion active users. Tencent is a huge Chinese business that focuses mainly on e-commerce, entertainment, and social media. It also has investments in Reddit, Snapchat, Spotify, Lyft, Discord, and Universal Music. This company also has investments in the video game industry, like Supercell (Clash of Clans), Epic Games (Fortnite), and Riot Games (League of Legends).
What is it used for?
Within China, people use WeChat for a multitude of services. These include online shopping, banking, e-payments, ride-hailing, communication, and more. It has also been running a lot of health code apps, that show people as under quarantine or allowed to travel, during the pandemic.
Most apps like Facebook, Twitter, and WhatsApp, are banned in China. Due to this, users cannot access these apps to make free calls and texts. This is where WeChat becomes indispensable. Users in the US can use WeChat to stay in touch with friends in family in China, conduct business transactions, and advertising. The immense popularity of this app has left tech giants like Facebook with a feeling of nervousness.
Why is it being banned?
According to Trump, any app based in China is a problem, and “untrusted” Chinese apps must be removed from US app stores.
According to the order, WeChat captures a lot of information about its users. This data collection allows China access to Americans’ personal information. It also mentioned that this app captures personal and proprietary information of Chinese nationals visiting the United States. This allows the Chinese Communist Party information about all Chinese citizens enjoying the benefits of a “free society”.
WeChat has also been accused of censoring content. It has also, in the past, been accused of censoring political messages during the Hong Kong protests.
Who will the ban affect?
The most important consequence of this ban, if implemented, is that it would cut off communications of millions of Chinese-Americans with their friends and family in China. A lot of American businesses and Universities will have trouble communicating with dealers, manufacturing partners, and students in China.
Another major blow could be faced by Apple. If implemented, this order could force Apple to pull WeChat from its app store. This could lead to consumers and Chinese businesses shifting to other smartphones,leading to a major impact on the sales of the iPhone. The ban could also harm Apple’s supply chain, as most of its products are still assembled in China.
China’s Ministry of Foreign Affairs responded to the ban with firm opposition. It also warned that the US will have to face the consequences of its actions. The Ministry also said that the US is using national security as a justification to oppress non-American businesses. A Tencent spokesperson also said that the company is studying the order to get a complete understanding.
Originally posted 2020-08-11 12:04:53.