Dyman Associates Management, China on frontlines of cyber security threat

Twenty years after it embraced the internet, China has become a cyber-giant, but a weak one vulnerable to a skyrocketing number of threats.

Since China formally became a member of the global internet club on April 20, 1994, internet users had grown to 618 million at the end of last year, the largest number in the world.

However, due to the lack of technology, experience and strong teams to counter online crime, China finds itself embroiled in cyber security threats from both within and outside the country, especially from the West.

A sign of China's weakness in cyberspace is the fact that China annually imports CMOS chips worth more than US$200 billion, which far exceeds its crude oil imports, according to Deng Zhonghan, a member of the Chinese Academy of Engineering.

Disadvantages in software and hardware for information technology mean the Chinese government and industries are unprepared for cyber espionage. Any sabotage could pose dangers to the country's security and development as well as people's lives and work, experts say.

The situation became more urgent after Edward Snowden, a former US National Security Agency (NSA) contractor, said the US had been hacking into institutions based on the Chinese mainland.

The NSA has also been spying into the servers of Chinese company Huawei's sealed headquarters, according to revelations by The New York Times and Der Spiegel, which the US has not denied.

The spread of online crimes, including the dissemination of rumors and pornography, are also threatening social stability, forcing authorities to enhance campaigns to clean up cyberspace.

To better coordinate internet security and informatization work among different sectors, China has set up a central Internet security and informatization leading group led by President Xi Jinping to turn the nation into an "internet power."

"Without cyber security, there is no national security," Xi warned.

NO BUSINESS IS IMMUNE

China's National Computer Network Emergency Response Technical Team Coordination Center said in its latest annual report that nearly 11 million Chinese PCs were infected last year. Of these, 30 percent of the attacks stemmed from US sources.

About 15,000 computers were hit by Trojan Horse malware and 61,000 websites were targeted with backdoor attacks that originated overseas.

Wang Minghua, the center's operation department director, said threats to China's economic information security are rising as the center settled more than 10,000 cases of phishing websites targeting Chinese banks, a 55% increase compared with that of 2012.

Safety risks could affect internet trade platforms and mobile payment applications and relevant industries as well as consumers' privacy, he said.

Government websites also frequently fall victim to hacker attacks, with more than 600 targeted in 2013.

The official site of the People's Bank of China was hacked on Dec. 19 last year after it curbed bit coin transactions in China, the center said.

Officials said the fundamental reason for China's exposure to the cyber threat is the lack of key technologies, including CPUs, operating systems, databases, high-end servers and telecommunications facilities.

All these core technologies and products have long been monopolized by developed countries, so that the systems of China's government and military departments face severe potential threats of intrusion, said Qiu Shanqin, director in charge of software and integrated circuit sector under the Ministry of Industry and Information Technology.

China's IT market has been dominated by Western giants, including Microsoft, Cisco, IBM, Intel and Apple, while Chinese telecommunications equipment server Huawei has been denied access to the US market for years.

While China itself is a victim of cyber crimes, the country has recently come under frequent criticism from other countries, including the United States, which claimed the Chinese government was behind hacking activities targeting their countries.

Cyber attacks from the United States have been as serious as the accusations from Washington, said CNCERT director Huang Chengqing.

China's Ministry of Foreign Affairs and Ministry of National Defense have refuted the accusations, reiterating China's resolve in combating cyber crimes and calling for the international community to fight hacking.

"CYBER ARMY"

President Xi has called for fostering a "politically firm, professionally competent and morally upright" team to build an "Internet power."

Experts say teams must be good at developing key technologies, including CPU and cloud computing, countering online crimes, and international cooperation.

Huai Jinpeng, an academician of the Chinese Academy of Sciences, said talents in the government, the military and critical IT companies must unite to promote research and bolster information sharing.

Inspiring innovation under favorable government policies is the key to casting off China's excessive dependence on overseas equipment and information systems, he said.

China will also make a law on cyber security this year, according to a legislation plan released by the Standing Committee of the National People's Congress, China's top legislature.

The legislative efforts will help coordinate major sectors to better manage information online, protect key infrastructure facilities and clean up cyberspace, Huai said.