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US, China remain at odds over cyber security

Publication Date : 11-07-2014


Cyber security and regional territorial disputes remain bugbears between China and the United States despite two days of high-level talks, which were hit by fresh allegations of Chinese hackers breaking into a US government agency's computer network.

At a media briefing yesterday after the annual Strategic and Economic Dialogue (SED), both sides were eager to point out how they had achieved more than 90 "important outcomes", mostly involving deeper cooperation on trade, finance and climate change.

"These are important actions that have set the foundations for the meeting between our presidents in November and injected positive energy into our new model of relations," said vice-premier Wang Yang at the briefing that took no questions from the 100-plus reporters present.

Chinese President Xi Jinping and US President Barack Obama are set to meet in Beijing on the sidelines of the Apec Leaders Summit and assess the "new model of major-power relationship" that both agreed to forge at their Sunnylands summit in California in June last year.

Both leaders had instructed their representatives at the SED - a yearly event to discuss bilateral and global issues - to pursue "win-win" cooperation and handle differences properly to avoid confrontation that would be "disastrous" to both countries and the world.

The US representatives were Secretary of State John Kerry and Treasury Secretary Jacob Lew, whose counterparts were Wang and state councillor Yang Jiechi, who oversees foreign policy.

But differences on key issues such as cyber security did not appear to have been narrowed, receiving hardly a mention at the briefing yesterday.

Wang and Yang did not broach the cyber security issue, while all Kerry said was that both sides recognised the "chilling effect" the loss of intellectual property has on their investments and competitiveness and that "frank exchange must continue in this area".

Cyber security talks this week were spiked after China suspended its involvement in a bilateral working group in May, following the US indictment of five Chinese soldiers for economic espionage.

The New York Times reported yesterday that Chinese hackers in March had broken into and gained access to Office of Personnel Management databases before being detected and blocked.

The hackers appeared to be targeting files on government employees who have applied for top-secret security clearance, according to senior US officials.

In a sign that a wide divide also remains on Beijing's maritime spats with its neighbours, Yang warned of "strategic misjudgment" between China and the US, according to a report by the official Xinhua news agency.

At the briefing yesterday, he cautioned the US not to take sides in the disputes that China has with Japan in the East China Sea and a host of Asean nations in the South China Sea.

But in a closed-door session on Wednesday, Kerry reportedly warned China it would be "unacceptable" for it to try to create a new status quo on both seafronts.

"The secretary emphasised this is not a situation in which countries should or can be permitted simply to act unilaterally to advance their territorial claims or interests," a senior unnamed US official was quoted as saying in media reports yesterday.

China hauled an oil rig on May 2 to waters near the Paracel islands contested by Vietnam, which sparked protests against Chinese and Taiwanese businesses and clashes between Chinese and Vietnamese vessels.

The oil rig move worsened regional tensions already roiled by China's launch of an air defence zone in the East China Sea last November that covers the contested Senkaku/Diaoyu islands administered by Japan.

During the two-day dialogue, Kerry also reportedly urged China to support the creation of a legally binding code of conduct in the South China Sea that the US has been negotiating with the 10-member Asean grouping.

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