IANS Analysis: Why Does No One Trust the Chinese?

New Delhi, August 4 (IANS): Microsoft recently reportedly banned its employees in China from using Android devices at work, ordering them to switch to Apple devices in September.

The move is aimed at mitigating cyberattacks and preventing data leaks from corporate assets. The unavailability of Google Play in China, leading to dependence on operating platforms from Chinese companies such as Huawei and Xiaomi, is a key factor.

The move follows Microsoft’s earlier offer to relocate some 800 local employees in China working in its artificial intelligence and cloud businesses to other countries. The relocation is in line with the U.S. administration’s efforts to limit Beijing’s access to advanced, sensitive technologies due to cybersecurity concerns.

While Microsoft describes this as a “regular part of its global operations,” its February report highlights concerns about state-sponsored cyberattacks, including hackers from China using Microsoft’s AI tools to gather intelligence and influence narratives.

Microsoft’s precautions are underscored by criticism from the U.S. Department of Homeland Security’s Cybersecurity Council, which cited a “cascade of errors” in Microsoft’s failure to prevent security breaches by the Chinese state-backed hacking group Storm-0558. The group targeted email accounts of about 22 organizations, including U.S. government officials, and accessed about 60,000 emails from the U.S. State Department.

Cyber espionage is undoubtedly the most serious national security threat facing the international community today. China’s involvement in cyber espionage has recently been exposed, despite its covert activities since 2019.

In March, the U.S. and U.K. filed criminal charges and imposed sanctions against Beijing, accusing it of using both artificial intelligence and Chinese citizens in malicious cyber hacking operations that have compromised the private data of millions of people around the world, including entrepreneurs, lawyers, journalists, academics, politicians, bureaucrats and critics of the Chinese government.

Similarly, New Zealand and Dutch intelligence agencies have accused China of state-backed espionage campaigns targeting Wellington Parliament and the Dutch arms industry.

Beijing’s cyberhacking activities have also spread to neighboring countries in Asia, as evidenced by the February leak of documents from i-Soon, a Shanghai-based cybersecurity firm, which revealed the Chinese government’s collaboration with private hackers i-Soon to gather intelligence from foreign governments and organizations.

China’s state-backed intelligence operations that target other nations through cyber espionage are primarily aimed at stealing intellectual property (IPT), particularly from Western countries. Given the reduced emphasis on innovation, Chinese companies, especially those with political connections, have little incentive to pursue innovative paths. This policy effectively promotes the theft of IPT.

To outdo Western companies in global market competition, Chinese policy allows the acquisition of foreign technological knowledge through both legal and illegal means. The latter includes cyber espionage.

In 2022, the Chinese Advanced Persistent Threat (APT) group 41 was suspected of conducting cyber operations that resulted in the theft of millions of dollars worth of IPT from approximately 30 international companies in the energy, manufacturing, and pharmaceutical sectors.

In addition, intelligence gathering is heavily skewed toward security sectors that possess knowledge of the technical capabilities of modern warfare. Emerging Chinese APT groups, such as APT 40, have increased their efforts to gather intelligence for the purpose of stealing intellectual property from both government institutions and private companies.

Telecoms companies such as Huawei and ZTE have been controversial due to Beijing’s potential use of 5G infrastructure for cyber espionage and intellectual property theft, posing a serious national security risk.

Last October, intelligence chiefs from the US, UK, Canada, Australia and New Zealand, the Five Eyes alliance, accused Beijing of stealing intellectual property through artificial intelligence in hacking operations, in what they said was an “unprecedented threat” from China to the world.

China’s espionage efforts extend beyond digital platforms to include physical infiltration in target countries. Using the diaspora as part of human intelligence is an example of this approach.

The 2022 report revealed Beijing’s long-term strategy to recruit prominent Chinese-American scientists who previously worked at the U.S. Department of Energy’s Los Alamos National Laboratory in New Mexico.

At least 162 such scientists with previous experience at the lab have reportedly been recruited into the service of the Chinese government, part of a broader, time-consuming, unconventional intelligence-gathering tactic in which Chinese researchers and academics are encouraged to develop their knowledge abroad and then share it with Beijing.

It should be noted that China’s Counter-Terrorism Law (2015) and National Intelligence Law (2017) impose an obligation on Chinese citizens, institutions and organizations to support and promote state intelligence activities by acting as informants.

Moreover, the United Front’s political role in managing the diaspora abroad aims to expand Beijing’s global influence and maintain a positive narrative about China, underscoring another aspect of its efforts to gain influence.

China’s venture capital (VC) investments in overseas countries have also come under scrutiny for their alleged involvement in human rights abuses and oversight activities. Rules requiring organizational compliance and intelligence cooperation with the government also apply to Chinese entities operating abroad.

Earlier this year, a U.S. congressional panel accused five U.S. VC firms of investing more than $3 billion in Chinese companies suspected of having ties to the Chinese government and military. Cooperation between Chinese companies and state-owned enterprises, particularly those involved in developing advanced and critical technologies, thus serves as a cautionary tale.

China’s involvement in global cyber espionage, influence operations, and intellectual property theft has been widely criticized, particularly by Western countries. This negative perception has recently intensified with accusations against China of foreign interference aimed at meddling in elections.

These hostile actions have had serious repercussions for China, resulting in the banning of TikTok and 5G telecommunications networks in many countries due to national security concerns.

Even among China’s allies, reports of poor performance and a lack of transparency and accountability regarding Chinese defense equipment have contributed to a decline in global arms exports in recent years.

The global view of China is further illustrated by a 2023 Pew Research survey of 24 countries, in which 67% expressed a negative opinion of China and 57% considered its foreign policy interventionist. It can therefore be concluded that trust in China is significantly insufficient.