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March 29, 2013

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China condemns 'biased' US ban on its technology

CHINA is calling a United States ban on purchases of Chinese-made technology "biased," after the two countries clashed over accusations of cyberattacks.

A bill, signed on Tuesday by President Barack Obama, stops the US government from buying information technology equipment "produced, manufactured or assembled" by firms "owned, directed or subsidized by the People's Republic of China."

Federal government agencies could buy IT products from China only if they pass a risks assessment involving "cyber-espionage or sabotage associated with the acquisition of such systems," according to the bill.

China's foreign ministry spokesman Hong Lei told reporters the bill "adopts a biased attitude toward Chinese enterprises under the pretext of information security." It is not conducive to the development of China-US relations, Hong said.

"We hope the US side could get rid of such a move and do more things that will promote the development of bilateral ties and mutual trust," he added.

The US imports about US$129 billion worth of "advanced technology products" from China, according to a May 2012 report by the Congressional Research Service.

The bill could hurt Chinese companies such as Lenovo, which sees sales to the US market as a major part of its North American growth strategy, reports said.

Lenovo, which bought IBM's PC unit in 2005 and is on track to become the world's largest PC maker, said it was aware of the bill and reviewing the specific language.

"Depending on how the language is interpreted, it could in fact apply very broadly to many companies across the IT industry from all around the world," the company said.

"We are very confident and comfortable that we will continue to be very successful in growing our business in the US even as we and all of our competitors navigate new regulations," it said in a statement.

US concern about cyberattacks has mounted in recent months, with top officials, including Obama, condemning the practice.

Obama raised the issue in a phone call with Chinese President Xi Jinping earlier this month, and told ABC News in an interview that some security threats were "absolutely" sponsored by governments.

Xi said the US and China should avoid making "groundless accusations" against each other about cyber-security and work together on the problem.

The US computer security company Mandiant claimed last month a Chinese military unit in Shanghai was the most likely driving force behind a series of cyberattacks on the United States.

China dismissed the report as groundless and said its defense ministry websites were often subject to attacks originating in the US.

China could challenge the latest measure as a violation of World Trade Organization rules.

It is possible that other countries could also raise objections because of the potential to prevent purchases of Lenovo computers made in Germany or Huawei handsets designed in Britain, said Stewart Baker, a former assistant secretary in the US Department of Homeland Security.





 

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