Snowden's disclosures of American electronic surveillance around the world give China an argument to counter US complaints. Photo: AFP
Revelations by former US spy agency contractor Edward Snowden will make it harder for the United States to confront China at talks this week over the alleged cyber theft of trade secrets worth hundreds of billions of dollars each year.
Snowden's disclosures of American electronic surveillance around the world give China an argument to counter US complaints that it steals private intellectual property (IP) from US companies and research centres.
Cyber security is at the centre of high-level meetings between the two countries in Washington that will show whether a positive tone struck by President Barack Obama and new Chinese President Xi Jinping at a summit last month can translate into cooperation on difficult issues.
Top US officials from Obama down have long tried to convince China to recognise a clear line between the kind of cyber espionage by spy agencies revealed by Snowden and the stealing of technology.
"This Snowden thing has muddied the waters in a terrible way," said James McGregor, author of a book on China's authoritarian capitalism and industrial policy.
"China would rather have the waters muddy, because they can say 'You do it. We do it. What's the big deal?' and the cyber theft against companies will go on and on," he said by telephone from China, where he is senior counselor for APCO Worldwide, a US business consultancy.
Treasury Secretary Jack Lew said last week that US officials will press China at the talks on cyber theft, a problem he described as "just different from other kinds of issues in the cyber area."
Many countries spy on each other, but US officials say China is unique in the amount of state-sponsored IP theft it carries out as it tries to catch up with the United States in economic power and technological prowess.
Last week the US Department of Justice charged Chinese wind turbine maker Sinovel Wind Group Co and two of its employees with stealing software source coding from US-based AMSC in an alleged theft worth $US800 million.
The US Chamber of Commerce hopes "to see a clear indication that China recognises thefts of trade secrets, whether by cyber or other means, is stealing property and will bring the full force of its laws to curb this," said Jeremie Waterman, the group's senior director for Greater China.
Beijing regularly parries complaints about Chinese hacking into the computers of US businesses by saying that China is itself a major victim of cyber espionage. Chinese officials have dismissed as unconvincing recent US official and private-sector reports attributing large-scale hacking of American networks to China.
Sign up for CIO Asia eNewsletters.