China denies military espionage accusations

May 7, 2013

China brushes off Pentagon’s hacking allegations, Bank of China shutters North Korean account, and Israeli strikes on Syria highlight possible Assad vulnerabilities. Today is Tuesday, May 7, and this is the World Wrap, brought to you by @dwbronner and @clarerrrr.

Members of the People’s Liberation Army guard of honor stand with red flags during an official welcome ceremony outside the Great Hall of the People, in Beijing, April 15, 2013. REUTERS/Jason Lee

What cyber crime? China vehemently denied first-ever accusations by the United States that it tried to hack into American defense computer networks, calling the accusations groundless and irresponsible. An annual report by the Pentagon stated that China is using espionage to modernize its military:

In its 83-page annual report to Congress on Chinese military developments, the Pentagon also cited progress in Beijing’s effort to develop advanced-technology stealth aircraft and build an aircraft carrier fleet to project power further offshore. The report said China’s cyber snooping was a “serious concern” that pointed to an even greater threat because the “skills required for these intrusions are similar to those necessary to conduct computer network attacks.”

The U.S. criticized China for failing to prevent the theft of American trade secrets last week. Tension between the two countries runs high over Chinese aggression over disputed islands and China’s support of North Korea.

North Korea ally cuts cash flow. Bank of China closed North Korea’s main foreign exchange bank’s account in the first public, significant distancing between a Chinese entity and Pyongyang.

The state-run Foreign Trade Bank had been told its transactions had been halted and its account closed, Bank of China, the country’s biggest foreign exchange bank, said in a brief statement on Tuesday. It gave no reason for the closure and the bank declined to comment further… China is North Korea’s traditional ally and its biggest trading partner. It is unclear how much of the $6 billion in annual bilateral trade goes through the Foreign Trade Bank.

North Korea sentenced a U.S. citizen to 15 years of hard labor last week, although Pyongyang says it will not use him as a bargaining chip with the United States. The detainment follows months of increased tension, after the North’s third nuclear test prompted heightened sanctions. South Korean President Park Guen-hye is meeting with President Obama today for talks that will include discussion of tensions with North Korea.

Assad’s air power questioned. Rebel leaders say Israeli air strikes on Syria this weekend demonstrates weaknesses in the Syria’s air force:

One rebel commander said Assad’s forces have been fortifying their positions on Qasioun since the uprising began in March 2011. “The Israelis still managed to get to the weapons stores. The secondary explosions indicate that they were right on target,” he said, adding that Syrian air defenses, already weakened by the civil war “could not do anything.” Other opposition sources also said the targets included air defenses comprising Russian-made surface to air missiles and heavy anti-aircraft guns, deployed on Qasioun and overlooking the rebellious Damascus district of Barzeh.

Israeli officials, seeking to assure the Assad regime that it was not taking sides in the conflict, said that the attacks were intended to prevent arms from reaching Hezbollah. Turkish Prime Minister Recep Tayyip Erdogan said the damage done by Israeli rockets gives Assad an opportunity to cover up government killings. U.S. Secretary of State John Kerry is visiting Russia in an effort to find a political solution for Syria’s conflict.

Nota Bene: Israeli Prime Minister Benjamin Netanyahu is quietly curbing new settlement expansion, possibly to help the U.S. restart peace talks with the Palestinians.


Breathe easy – When traveling to China, don’t forget to pack a gas mask. (Bloomberg Businessweek)

Supermarket showdown – Ecuador recalls its ambassador to Peru after a grocery store brawl is caught on tape. (Reuters)

Rise of the rich – The Philippines’ storybook economic growth is no fairy tale. (The Atlantic)

In bad company – The U.S. has highest first-day death rate among developed countries, according to a Save the Children report. (CBC)

Poster prejudice – An anti-gay marriage poster featuring France’s black minister of justice as a King Kong-like gorilla prompts accusations of racism. (Euronews)

From the File:

  • Pakistan election violence forces candidates behind high walls
  • Libya defense minister quits over siege of ministries by gunmen
  • U.N. names team to investigate torture, camps in North Korea
  • Russian media magnate Lebedev goes on trial
  • Tunisia hunts al Qaeda-linked militants near Algeria
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