China Slams US Over Economic Espionage Charges

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China Slams US Over Economic Espionage Charges

How will this impact the bilateral relationship?

China Slams US Over Economic Espionage Charges

Tianjin Economic-Technological Development Area.

Credit: Wikimedia Commons

The recent indictment of six Chinese nationals by U.S. legal authorities on charges of economic espionage and theft of trade secrets has been met with severe criticism from Chinese officials and the Chinese media (see: “6 Chinese Men Charged With Economic Espionage in US”).

According to China’s Foreign Ministry spokesman, Hong Lei, the People’s Republic will be closely monitoring the situation. “China is severely concerned. The Chinese government will make sure the rights and interests of Chinese citizens are guaranteed during their interactions with American personnel,” he said.

“The Chinese government firmly opposes and combats thefts of trade secrets, in accordance with law,” foreign ministry spokesman Hong emphasized. “As for this case, we are still checking on the details.”

A commentary in the state-run news agency Xinhua was less diplomatic when it stated that “another six Chinese nationals fell victim to Washington’s growing paranoia.” Additionally, the commentary cautioned:

The U.S. government should learn from its past mistakes and drop the practice of bringing unwarranted charges against innocent people without solid evidence. Such behavior would not only dent China-U.S. relations, but also inflicts unmeasurable damage on those people’s lives.

Xinhua also reports that officials of Tianjin University – the university accused of partnering up with the defendants and setting up a joint venture to domestically produce stolen U.S. technology – vehemently denies any wrongdoing.

The university issued a statement that “strongly condemns any groundless accusations and act to tarnish its fame and reserve the right to safeguard the university’s fame with legal means.”

In another article published in the China Youth Daily and quoted in the Wall Street Journal, university officials stated that “the politicization of the professors’ scientific research, elevating it to the level of ‘economic espionage,’ would harm normal academic exchanges.”

The charges the six Chinese men, including three professors, face could result in lengthy prison sentences and heavy fines – at least for one of the accused who has recently been arrested on American soil. Concerns by U.S. authorities over Chinese economic espionage activities have increasingly moved to the center of bilateral discussions and negatively impacted Sino-US relations in recent years (see: “What the US Gets Wrong About Chinese Espionage”).

In a press release by the U.S. Department of Justice, U.S. Attorney Melinda Haag of the Northern District of California, that this case demonstrates, “sensitive technology developed by U.S. companies in Silicon Valley and throughout California continues to be vulnerable to coordinated and complex efforts sponsored by foreign governments to steal that technology.” A 2013 report by a U.S. commission on intellectual-property theft  accused China of being responsible for as much as 80 percent of the intellectual-property theft against U.S. companies – most of it via cyber espionage.

However,  my colleague at the EastWest Institute, Greg Austin, published a controversial research paper today in which he argues that the United States has failed to make  a convincing case in the public domain that the costs of Chinese cyber espionage to the U.S. civil economy are as high as it claims or that it is official Chinese policy to use the state agencies to divert information on U.S. civil sector firms collected via cyber espionage to the benefit of Chinese civil sector firms.   Dual-use technologies, he argues, are in a different category, but even there the U.S. had not made a strong case in its public domain information (see: “China’s Cyberespionage: The National Security Distinction and U.S. Diplomacy”).