[UPDATED] China Reportedly Lifts Ban On Facebook In The Shanghai Free-Trade Zone, But Continues Crackdown On Internet Freedom

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[UPDATE: The People’s Daily, a newspaper run by the Communist Party of China, has published a story (link via Google Translate) denying  that Facebook and other sites will be made available in the Shanghai Free-Trade Zone. The South China Morning Post reported earlier this week that the Chinese government will allow access to some banned Web sites in the Shanghai Free-Trade Zone, including Facebook, Twitter and The New York Times, citing anonymous government sources.]

We have emailed the three companies to ask for confirmation. Facebook COO Sheryl Sandberg met with the State Council Information Office in Beijing during her recent trip, but said she was there to promote the Chinese edition of “Lean In.” It’s unknown if the meeting was related to the lifting of the ban on Facebook in the free-trade zone.

Facebook and Twitter have been barred in mainland China since 2009, but many people still use VPNs and proxy servers to break through the Great Firewall of China, as the Golden Shield Project, the government’s Internet censorship program is nicknamed, and access the sites. Tech In Asia notes that the Fortune Global Forum 2013 conference, hosted by the city of Chengdu, had VPNs set up, as do many top hotels and office towers owned by Hong Kong companies. The New York Times was banned in October 2012 after publishing articles criticizing the family wealth of former Chinese premier Wen Jiabao (which also prompted a series of attacks on the paper’s servers by Chinese hackers).

First announced in July 2013, the Shanghai Free-Trade Zone was set up by the Chinese government as a way to see how economic and financial reforms might work in the rest of the country. The SCMP also reported that the zone’s authority will begin accepting bids from foreign companies for licenses to provide Internet services within the area. The Free-Trade Zone is currently 28.78 square kilometers, but will eventually cover all of Pudong district, which currently has a population of about 5 million. This means that they will compete with China’s three main carriers, China Mobile, China Unicom and China Telecom, all of which are state owned.

The decision to open access to Facebook, Twitter and the New York Times site was reportedly endorsed by Premier Li Keqiang and is part of an effort to spur interest from foreign investors in the Shanghai Free-Trade Zone by making it more attractive for expats. It does not signify, however, a liberalization in the Chinese government’s attitude toward social media. The Communist Party is currently engaging in its most intense online crackdown ever. In recent months, it has detained Charles Xue, a Chinese-American entrepreneur who frequently posted political content to his 12 million followers on Sina Weibo, and allegedly forced real estate tycoon and prolific microblogger Pan Shiyi to film a TV interview about the dangers of social media.