US Ambassador Baucus Says China Hacking Threatens National Security

(Reuters) - Cyber theft of trade secrets by China is a threat to U.S. national security, U.S. Ambassador to China Max Baucus said on Wednesday in the first major public address of
his tenure, warning that Washington would continue to pressure Beijing.

Baucus' remarks come as commercial ties between the world's two largest economies
have been strained over cyber espionage charges and revelations by former National
Security Agency contractor Edward Snowden of U.S. spying.

In May, Washington indicted five Chinese military officers for hacking U.S. companies,
prompting Beijing to suspend a Sino-U.S. working group on cyber issues.

It adamantly denies the charges.
Such behavior is criminal and runs counter to China's World Trade Organization commitments, Baucus told business leaders at an American Chamber of Commerce in
China luncheon two weeks ahead of annual high-level bilateral talks in Beijing.

"Cyber-enabled theft of trade secrets by state actors in China has emerged as a major threat to
our economic, and thus, national security," Baucus said.

"We won't sit idly by when a crime is committed in the real world. So why should we when it
happens in cyber space?" he said. "We will continue to use diplomatic and legal means to
make clear that this type of behavior must stop."

Tensions over cyber security rose in late 2012 after Washington banned Chinese communications makers Huawei Technologies Co Ltd and ZTE Corp from building U.S.
telecoms infrastructure.

Beijing responded by pressuring big state- owned firms to stop buying U.S.-made hardware, emphasizing security risks following Snowden's revelations, people in the industry said.

U.S. equipment and software providers such as IBM Corp and Cisco Systems Inc have already
seen their China sales drop after the Snowden leaks.