The heads of Britain’s MI5 and the US Federal Bureau of Investigations (FBI) have sounded the alarm about Chinese industrial espionage in a rare joint speech in London.
MI5 Director Ken McCallum said on Wednesday that the “Chinese government’s covert pressure around the world” is “the most game-changing challenge we face,” while FBI Director Chris Wray warned Western firms that Beijing was determined to protect their technology stealing to gain competitive advantage.
China immediately dismissed the allegations as “baseless” and an attempt to “slander” its political system.
McCallum and Wray’s joint address took place at London’s Thames House, in the presence of officials and businessmen.
The Chinese threat “might feel abstract. But it’s real and it’s urgent,” McCallum said. “We need to talk about it. We have to take action.”
He said MI5, the UK’s domestic intelligence agency, had greatly expanded its China-focused operations.
“Today we are conducting seven times as many investigations as we did in 2018,” he said. “We plan to grow that strong again while also making significant efforts against Russian and Iranian covert threats.”
McCallum said Chinese intelligence took a slow and patient approach to developing sources and gaining access to information, and few of the targets identified themselves as such.
“There is hostile activity taking place on British soil right now,” he said.
“By volume, most of what is endangered by Chinese Communist Party aggression is not my stuff, so to speak. It is yours – the world-leading expertise, technology, research and commercial advantage developed and held by the people of this space and others like you.”
The FBI director reiterated that message, calling China’s actions a “complex, persistent, and pervasive threat” to the United States, Britain, and other allies.
Wray said China is “out to steal your technology, whatever drives your industry, and use it to undermine your business and dominate your market.” He also warned that a Chinese invasion of Taiwan, which Beijing considers its territory, would cause “one of the most terrible” disruptions to global trade and industry.
He said there are signs the Chinese, who may learn lessons from Russia’s post-war experience, have been looking for ways to “insulate” their economy against possible sanctions.
“In our world, we call this behavior an indication,” Wray said, urging caution for Western companies looking to do business in or with China.
Robert Potter, co-CEO of Australian-American cybersecurity firm Internet 2.0, said it was necessary for the public to clearly understand the threat posed by China.
“For too long the safety culture of these agencies has left the public without context as to what is really going on. These agencies need to share their information with the private sector and the broader public because the targeting of China is much broader than just the intelligence community,” Potter said.
“China is engaging in industrial espionage on an unprecedented scale. Regardless of the criticism one might level at US or Australian authorities, they do not steal pharmaceutical patents for their private sector partners. As a result, it is a different species and scale.”
However, Troy Hunt, a cybersecurity expert and Microsoft regional director in Australia, said the two agencies engaged to some degree in a “pretentious” manner, as China’s actions were unsurprising, if somewhat troubling.
“Perhaps what we’re seeing is just an acknowledgment of the escalation or increasing importance of it over time,” Hunt said.
He added that people shouldn’t be “fatalistic” about threats to their privacy and, in most cases, shouldn’t worry too much about state-sponsored hacking. “To be honest, I don’t think we really need to do anything different at the consumer level other than follow all the good advice that we’ve been given for so long,” Hunt said.
“Certainly those who are more the target of something like the CCP regime…[should] be a lot more aware and a lot more concerned, but I don’t think this is really a problem that should worry the masses on an individual level.”
During the discussion at Thames House on Wednesday, Wray also addressed China’s promise to unite with Taiwan, either peacefully or by force if necessary.
In the event of a Chinese invasion, “just like in Russia, Western investments built up over years could become hostage, stranded capital [and] Supply chains and relationships disrupted,” Wray said.
Last week, Avril Haines, the US government’s director of national intelligence, said at an event in Washington, DC there were no signs Chinese President Xi Jinping was ready to take military action against Taiwan. However, she said Xi appears to be pursuing “the potential” for such measures as part of a broader Chinese government goal of unification.
The Chinese embassy in London has dismissed McCallum and Wray’s allegations, calling them “completely unfounded”.
“The so-called cases they list are pure shadow hunting,” a spokesman said in a statement released on the mission’s website. “They spread all sorts of lies about China to smear China’s political system, foment anti-China and exclusionary sentiment, and divert public attention to cover up their own nefarious deeds.”
The Chinese embassy in Washington, DC, told the Associated Press in a statement that the Taiwan issue was “a purely internal matter of China.”
“We will pursue the prospect of peaceful reunification with the utmost sincerity and effort,” the statement said, although it noted that China “will reserve the option to take any necessary measures in response to interference by foreign forces.” seize”.