(Yicai Global) April 20 -- The United States-China Economic and Security Review Commission released a report yesterday that claims the Chinese government may be abetting some companies in conducting corporate espionage intended to enhance the competitiveness of Chinese firms, while potentially advancing other government interests. The report singled out ZTE Corp., Huawei Technologies Co. and Lenovo Group Ltd. as possible actors, huanqiu.com reported.
Titled Supply Chain Vulnerabilities from China in U.S. Federal Information and Communications Technology, the study discusses China’s impact on American communication technologies and makes recommendations for supply-chain risk management.
China is not a US ally and is not likely to become one anytime soon, the report advises. The Chinese government and actors associated with it have repeatedly engaged in well-documented instances of theft and misuse of intellectual property, as well as state-directed economic espionage. Chinese government policies aim to create and support Chinese nationalist champions -- companies that further the government’s strategic aims in return for government support, the report asserts.
Government support can take many forms, but often includes preferential financing rates, priority in government contract bidding, and sometimes oligarchical or monopolistic status in protected industries. ZTE, Huawei and Lenovo are three Chinese information and communications technology firms that “exhibit some of these characteristics,” it concludes.
The US government needs a national strategy for ICT supply chain risk management, should advocate supply-chain transparency and formulate prospective policies, the report recommends.