News / Economy

Economic, Cyber Espionage Issues May Dominate US-China Talks

Economic & Cyber Espionage Issues May Dominate US-China Talksi
X
July 10, 2013 10:21 AM
As the United States and China open the fifth round of their Strategic and Economic Dialogue Wednesday, top U.S. officials are optimistic the two sides will agree to cooperate on a range of strategic issues. But major differences, analysts say, could emerge in the economic discussions where the intense competition between the two nations is highlighted by the controversy surrounding cyber security. Natalie Liu has more from Washington.
TEXT SIZE - +
Natalie Liu
As the United States and China open the fifth round of their Strategic and Economic Dialogue Wednesday, top U.S. officials are optimistic the two sides will agree to cooperate on a range of strategic issues.  But major differences, analysts say, could emerge in the economic discussions where the intense competition between the two nations is highlighted by the controversy surrounding cyber security.

This latest round of talks is taking place at a time when the U.S. job market is showing signs of steady improvement -- while China's economy appears to be heading into rough waters.

George Haley, author of two books on China - The Chinese Tao of Business, and Subsidies to Chinese Industry, says many Chinese industries have large over-capacity.

"For instance, the solar panel industry - China’s production capacity is actually 200 percent of worldwide demand; you have 20 or 30 percent over capacity in industry after industry that has been receiving government support - steel, auto parts, paper, chemicals,” he said.

Over-capacity, falling demand from overseas and impending high unemployment could pose a real threat to economic and social stability as Chinese companies face the increasing challenge of turning a profit.  

“China’s goal is still market access," said longtime Chinese activist Wei Jingsheng. "Without overseas markets, Chinese companies will have to immediately focus on China’s domestic market, but it would be very difficult, almost impossible, for all these export-oriented companies to turn around fast enough.”

Wei and others believe the symptoms of China’s current economic problems are rooted in the so-called “Chinese model of development" which is directed and largely controlled by the state -- instead of relying on citizens’ initiative and market mechanisms.

Meanwhile, the alleged Chinese state involvement in economic espionage through cyber intrusions has been the focus of Washington’s complaints towards Beijing since the beginning of this year.

“Comparing American espionage with Chinese espionage: I freely admit - because I headed two espionage agencies - that we go out there to steal secrets to keep Americans free and to keep Americans safe," said Michael Hayden, a former director of both the CIA and the NSA.  "We don’t go out there to steal secrets to make Americans rich.  The Chinese cannot make that statement with regard to their espionage activity.”

On the Chinese side, in bilateral meetings held just a month ago in California, President Xi Jinping sounded an optimistic note on potential cooperation between the United States and China on cyber security.

“Through earnest cooperation, doubts and mistrust can be dispelled; going forward, cooperation in the area of information security and cyber security might indeed become a bright spot in bilateral relations,” he said.

But analysts say it would be difficult for cyber security to become a “bright spot” in Sino-U.S. relations - and for foreign investment in China to remain unchanged - if Beijing does not pull back on economic theft and espionage.  

“If they’re proved to be engaging in really illegal, exploitative behavior and deception, they promised they are not, this affects a lot of companies’ investment decisions to invest in China," said Michael Pillsbury, a senior fellow at The Hudson Institute. "It would probably affect our Congress.”

At the same time, analysts say the U.S. is determined to protect and preserve its competitive advantage in science and technology.  

"From the U.S. position, economically speaking, it doesn't make sense to give up technology," George Haley said. "It's the country's competitive advantage, and it's already under very significant challenge worldwide."

The Strategic and Economic Dialogue concludes Thursday with the expected release of a joint statement.

You May Like

Video Pope Francis Hopes Dual Canonizations Will Reconcile Church

John the XXIII and John Paul II will be made saints in a ceremony at St. Peter’s Square on April 27 More

Thailand Reacts to Plots Targeting Israelis

Authorities hope arrest of two Lebanese suspects will disrupt plot to attack young Israeli tourists More

Video In Capturing Nature's Majesty, Film Makes Case for Its Survival

'Once Upon a Forest' takes viewers deep into heart of tropical rainforest More

This forum has been closed.
Comment Sorting
Comments
     
by: Yoshi from: Sapporo
July 10, 2013 9:33 PM
Cncerning about espionage, what Hyden said made us understand the differences between Chinese and American espionages. If China actually has been exploiting and deceiving other countires' intelliences, it shoud be honest to admit the fact and to abandon such illegal manners.


by: Yoshi from: Sapporo
July 10, 2013 9:03 PM
It is reported on this morning newspapers in Japan that main reasons for Chinese economic decline is decreased exportations to Europe and Japan. It could be said that Chinese economy also can not be free from the affection from world economy.

Yes, I agree China should explore more domestic demands and transfer state-own firms to private ones. In order to develope industries, state supports would be needed in every developing coutires. But now China is no longer a developing country at least on the aspect of economy. Thank you.

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Pope Francis Hopes Dual Canonizations Will Reconcile Churchi
|| 0:00:00
...
 
🔇
X
Jerome Socolovsky
April 22, 2014 4:14 PM
On April 27, two popes - John the XXIII and John Paul II - will be made saints in a ceremony at St. Peter’s Square. VOA religion correspondent Jerome Socolovsky says the dual canonization is part of the current pope’s program to reconcile liberals and conservatives in the Roman Catholic Church.
Video

Video Pope Francis Hopes Dual Canonizations Will Reconcile Church

On April 27, two popes - John the XXIII and John Paul II - will be made saints in a ceremony at St. Peter’s Square. VOA religion correspondent Jerome Socolovsky says the dual canonization is part of the current pope’s program to reconcile liberals and conservatives in the Roman Catholic Church.
Video

Video In Capturing Nature's Majesty, Film Makes Case for Its Survival

French filmmaker Luc Jacquet won worldwide acclaim for his 2005 Academy Award-winning documentary "March of the Penguins". Now Jacquet is back with a new film that takes movie-goers deep into the heart of a tropical rainforest - not only to celebrate its grandeur, but to make the case for its survival. VOA's Rosanne Skirble reports.
Video

Video Boston Marathon Bittersweet for Many Runners

Monday's running of the Boston Marathon was bittersweet for many of the 36,000 participants as they finished the run that was interrupted by a double bombing last year. Many gathered along the route paid respect to the four people killed as a result of two bombings near the finish line. VOA's Carolyn Presutti returned to Boston this year to follow two runners, forever changed because of the crimes.
Video

Video Pacific Rim Trade Deal Proves Elusive

With the U.S.-led war in Iraq ended and American military involvement in Afghanistan winding down, President Barack Obama has sought to pivot the country's foreign policy focus towards Asia. One aspect of that pivot is the negotiation of a free-trade agreement among 12 Pacific Rim nations. But as Obama leaves this week on a trip to four Asian countries he has found it very difficult to complete the trade pact. VOA's Ken Bredemeier has more from Washington.
Video

Video Robotic Mission Kicks Up Lunar Dust

A robotic mission to the moon was deliberately crashed onto the lunar surface late last week, but not before scientists had collected data gathered by the spacecraft which was designed to self-destruct. VOA's Rosanne Skirble reports on the preliminary findings of the craft, called LADEE - an acronym for Lunar Atmosphere and Dust Environment Explorer.
Video

Video Boko Haram Claims Responsibility for Bombing in Nigerian Capital

The Nigerian militant group known as Boko Haram has claimed responsibility for a bombing in the capital on April 14th that killed 75 people. In the video message, Abubakar Shekau, the man who says he ordered the bombing, says nothing about the mass abduction of more than 100 teenage girls, most of whom are still missing. Heather Murdock has more for VOA from Abuja.
Video

Video Ukraine Developments Hang Over Obama Trip to Asia

President Barack Obama's trip to Asia this week comes as concerns over Beijing's territorial ambitions are growing in the region. Those concerns have been compounded by Russia's recent actions in Ukraine and the possibility that Chinese strategists might be looking to Crimea as a model for its territorial disputes with its neighbors. VOA's Bill Ide has more from Beijing.
Video

Video Autistic Adults Face Housing, Job Challenges

Many parents of children with disabilities fear for the future of their adult child. It can be difficult to find services to help adults with disabilities - physical, mental or emotional - find work or live on their own. The mother of an autistic boy set up a foundation to advocate for the estimated 1.2 million American adults with autism, a developmental disorder that causes communication difficulties and often social difficulties. VOA's Faiza Elmasry reports.
AppleAndroid

World Currencies

EUR
USD
0.7217
JPY
USD
102.17
GBP
USD
0.5949
CAD
USD
1.1009
INR
USD
60.326

Rates may not be current.