The heads of the United Kingdom and the United States’ domestic intelligence services have raised alarms about Chinese economic espionage in a rare joint address in London.
Ken McCallum, the director of the UK’s MI5, said on Wednesday that the Chinese government “covert pressure across the globe” amounts to “the most game-changing challenge we face”, while Chris Wray, the director of the Federal Bureau of Investigations ( FBI), warned Western firms that Beijing was determined to steal their technology for competitive gain.
China immediately rejected the accusations as “groundless”, labeling them an attempt to “smear” its political system.
McCallum and Wray’s joint address took place in London’s Thames House, with officials and business executives in attendance.
The Chinese threat “might feel abstract. But it’s real and it’s pressing, ”McCallum said. “We need to talk about it. We need to act. ”
He said the MI5 had sharply expanded its China-focused operations.
“Today we’re running seven times as many investigations as we were in 2018,” he said. “We plan to grow as much again, while also maintaining significant effort against Russian and Iranian covert threats.”
McCallum said Chinese intelligence takes a slow and patient approach to developing sources and gaining access to information, and few of those targeted recognized themselves as such.
“Hostile activity is happening on UK soil right now,” he said.
“By volume, most of what is at risk from Chinese Communist Party aggression is not, so to speak, my stuff. It’s yours – the world-leading expertise, technology, research and commercial advantage developed and held by people in this room, and others like you. ”
The FBI director repeated that message, calling China’s actions a “complex, enduring and pervasive danger” to the US, the UK, as well as other allies.
Wray said China was “set on stealing your technology, whatever it is that makes your industry tick, and using it to undercut your business and dominate your market”.
Analysts were divided on the joint address, with some calling it long overdue while others said it amounted to “grand-standing”.
Robert Potter, Co-CEO of Australian-US cybersecurity company Internet 2.0, said it was necessary that the public should accurately understand the threat posed by China.
“For too long the security cultures of those agencies has left the public without context as to what is really going on. There is a need for these agencies to share their intelligence with the private sector and broader public as the targeting of China is much broader than just intelligence agencies, ”he said.
“China has engaged in industrial espionage on a scale that is unprecedented. Whatever the criticisms one might make of US or Australian agencies, they aren’t out there stealing pharmaceutical patents for their private sector partners. ”
But Troy Hunt, a cybersecurity expert and Microsoft Regional Director in Australia, said there was no threat to the larger global public from the Chinese Communist Party (CCP).
“To be honest, I do not think that, certainly on the consumer level, we really need to really do anything different, other than to follow all the good advice we’ve had for so long,” he said. Certainly those who are more likely to be the target of something like the CCP regime…[should] be a lot more conscious and a lot more concerned, but I do not think this is really a problem that should worry the masses on the individual level. ”
During the discussion at Thames House, Wray also addressed China’s promises to unify with Taiwan, either peacefully or by force if necessary.
He warned that a Chinese invasion of Taiwan, which Beijing views as its territory, would cause “one of the most horrific” disruptions to global commerce and industry, and said there are signs the Chinese, perhaps drawing lessons from Russia’s experience since the war, have looked for ways to “insulate their economy” against potential sanctions.
In the event of a Chinese invasion, “just as in Russia, Western investments built over years could become hostages, capital stranded [and] supply chains and relationships disrupted, ”Wray said.
Last week, the US government’s director of national intelligence, Avril Haines, said at an event in Washington, DC, that there were no indications that Chinese President Xi Jinping was poised to take military action against Taiwan. But she did say Xi appeared to be “pursuing the potential” for such action as part of a broader Chinese government goal of unification.
The Chinese embassy in London rejected McCallum and Wray’s accusations, describing them as “completely groundless”.
“The so-called cases they listed are pure shadow chasing,” a spokesperson said in a statement posted on the mission’s website. “They spread all kinds of lies about China in order to smear China’s political system, stoke anti-China and exclusion sentiment, and divert public attention in order to cover up their own infamous deeds.”
The Chinese embassy in Washington, DC, also told the Associated Press news agency in a statement that the Taiwan issue was “purely China’s internal affair”.
“We will strive for the prospect of peaceful reunification with utmost sincerity and efforts,” the statement said, though it noted that China will “reserve the option of taking all necessary measures in response to the interference of foreign forces”.