US economic security threatened by Chinese cyber espionage

The Defense Department on May 18 released its “Annual Report to Congress: Military and Security Developments Involving the People’s Republic of China 2012.” The report specifically calls out that in 2011 China’s leaders sustained investment in military cyberspace capabilities in support of what the Peoples’ Liberation Army (PLA) refers to as its counter-intervention operations.

The report also states that the PLA’s counterspace capabilities include cyber weapons. However, of particular interest was the Cyber Espionage and Cyberwarfare Capabilities section on page 9. This is where the authors called out the theft of sensitive U.S. economic information and technology that belonged to intelligence services, private-sector companies, academic/research institutions, and even private citizens from dozens of countries. The report goes as far as to say that Chinese actors are the world’s most active and persistent perpetrators of economic espionage. The Defense Department acknowledges in the report that China’s activities represent a growing and persistent threat to U.S. economic security.

As you may recall, there were public disclosures in 2011 that there had been multiple intrusions of U.S. companies in key technology sectors that included companies that directly support U.S. defense programs. The report goes on to highlight that the PRC has openly demonstrated that one of its national security objectives is to leverage legally and illegally acquired dual-use and military-related technologies to its advantage.

The report culminates in a statement that China is likely to remain an aggressive and a capable collector of sensitive U.S. economic information and technologies, particularly in cyberspace. That should not surprise anyone.