US, China talks hit the wall on cybersecurity, maritime dispute

Agreeing to disagree on issues of cybersecurity and maritime disputes, China and the US on Thursday decided to work for ‘constructive’ management of their differences while laying emphasis on issues like trade ties, North Korea and climate change. ‘Instances of cyber-theft have harmed our business and threatened our nation’s competitiveness,’ Kerry said at the end of two days of US-China sixth annual Strategic Economic Dialogue (SED) here.

‘The loss of intellectual property through cyber (theft) has a chilling effect on innovation and investment,’ he said. To Beijing’s discomfort, Washington indicted five PLA officials in May for hacking into US companies. The two sides traded allegations after the leaks by NSA contractor Edward Snowden have alleged widespread US surveillance over Chinese entities. Cybersecurity was a ‘common threat and challenge facing all countries,’ State Councillor Yang Jiechi, who led the Chinese side to the talks, said.

‘Cyberspace should not become a tool for damaging the interests of other countries,’ he said.
Notwithstanding US requests, Beijing refused to resume the working group on cybersecurity it folded up after the indictment of PLA officials. It apparently demanded the repeal of the indictments.
The two also disagreed over means to resolve tensions in the South and East China Seas, amid caution from the US that Beijing risks triggering conflict as it presses its claims to large swathes of territory. ‘We do believe that claimants should exercise restraint and adhere to peaceful and diplomatic ways,’ Kerry said. But Yang earlier refused to yield any ground and urged the US to ‘honour its commitment of not choosing sides’ in the maritime disputes. ‘China is committed to upholding its territorial sovereignty and maritime rights,’ Yang said.

China’s territorial disputes with its neighbours pose major challenge to the US as many of the countries are America’s close allies. The two sides achieved over 90 per cent outcomes from the SED specially on the trade and climate issues, official media said. Both agreed to launch negotiations on the negative list of Bilateral Investment Treaty (BIT) early next year and concrete actions to cut emissions. US pledged to ensure level playing field for Chinese investments and encourage high tech exports for civilian use, state-run CCTV report said. Often accused by US officials and lawmakers of not playing by global rules, China said it will speed up reforms on currency exchange.

John Kerry cites frank cyberhacking talks with Beijing

US Secretary of State John Kerry on Thursday said that the United States and China had a frank exchange on the issue of cyberhacking during this week’s ‘Strategic and Economic Dialogue’ in Beijing. Kerry said the loss of intellectual property through hacking has had a ‘chilling effect on innovation and investment,’ and said such activity is hurting US companies. He made no mention of a New York Times report suggesting significant Chinese hacking of information about US government personnel. Chinese foreign policy chief Yang Jiechi described cybersecurity as a ‘common threat facing all countries.’

Speaking through an interpreter, Yang said the issue required mutual trust. ‘Cyberspace should not become a tool for damaging the interests of other countries,’ he said. The two countries have been at odds over US indictments of five senior Chinese military officials. Washington accused the officials of stealing trade secrets from US companies and giving them to Chinese competitors.
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