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China Summons Envoy, Suspends Security Deal in Cyberspying Spat

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BEIJING - China summoned the U.S. ambassador Tuesday and suspended a months-old security deal in response to the Justice Department accusing five Chinese military officers for cyberespionage.

The DOJ filed charges Monday stating that the hackers broke into American nuclear, metal and solar companies to steal trade secrets. The charges are the first of their kind brought by the U.S. against foreign officials.

Beijing responded with a blisteringly worded statement, accusing the U.S. of having "long been involved in large-scale and organized cyber theft as well as wiretapping and surveillance activities against foreign political leaders, companies and individuals."

Hours later, the U.S. Ambassador to China Max Baucus was called to a meeting with Chinese Foreign Minister Zheng Zeguang.

Image: U.S. Ambassador to China Max Baucus
U.S. Ambassador to China Max Baucus, seen here shortly after he took up his post in March, has been summoned to a meeting with China's Foreign Minister.Lintao Zhang / Getty Images, file

Zheng protested the U.S. actions, saying the indictment had seriously harmed relations between both countries, according to state run news agency Xinhua. He also told Baucus that China would consider taking further action on the U.S.'s charges.

Embassy Spokesman Nolan Barkhouse confirmed that Baucus had been summoned to the ministry.

"Ambassador Baucus met with a Ministry of Foreign Affairs official to discuss cyber," he said.

China also suspended the fledgling China-U.S. Cyber Working Group, a high-level diplomatic initiative both countries agreed to in April to stop their war of words over allegations of government-sponsored hacking.

Jen Psaki, a spokeswoman for the State Department, said the U.S. was disappointed at China's response. She added that Secretary of State John Kerry hoped a U.S.-China strategic and economic conference would go on as scheduled in July.

"We expect the Chinese government to understand that today's announcement relates to law enforcement," Psaki said, calling the charges "consistent with the concerns we've candidly raised with the Chinese government on these issues."

Each of the alleged hackers was hit with 31 criminal counts for a conspiracy that stretched back eight years, officials said. The companies alleged to have been targeted were Westinghouse Electric, U.S. subsidiaries of SolarWorld AG, U.S. Steel, Allegheny Technologies and Alcoa. The United Steel Workers union was also said to have been targeted.

FBI Director James Comey told NBC News that "for too long, the Chinese government has blatantly sought to use cyberespionage to obtain economic advantage for its state-owned industries."

The Chinese statement, which was prominently published in Chinese and English on the Foreign Ministry website, accused the U.S. of hypocrisy and "insincerity," casting Beijing as the real victim.

"China has, on many occasions, made serious representations with the U.S. side," it said. "We once again strongly urge the U.S. side to make a clear explanation of what it has done and immediately stop such kind of activities."

Washington and Beijing have endured an increasingly tense relationship in recent months, fueled not just by cybersecurity fears but Beijing's maritime territorial disputes with its neighbors, notably Japan. The U.S. owes more money to China than any other country in the world, with Beijing holding $1.27 trillion in its Treasury bonds as of March this year.

NBC News researcher Chaojie Zhou and Reuters contributed to this report. M. Alex Johnson reported from Los Angeles, Catherine Chomiak reported from Washington, and Alexander Smith reported from London.

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