9:10AM BST 20 May 2014
Beijing summoned the US ambassador and accused Washington of double standards Tuesday over its unprecedented indictment of five Chinese military officers for cyber-espionage.
With the diplomatic row between the global superpowers swiftly escalating, China's defence ministry denounced Washington's allegations as "a pure fabrication by the US, a move to mislead the public based on ulterior motives".
"From 'WikiLeaks' to the 'Snowden' case, US hypocrisy and double standards regarding the issue of cybersecurity have long been abundantly clear," the ministry said in a statement posted on its website.
On Monday night, Chinese assistant Foreign Minister Zheng Zeguang summoned US ambassador Max Baucus and lodged a "solemn representation" over the indictment.
China has also suspended cooperation with the US on cybersecurity issues and has issued an order prohibiting the use of Microsoft's Windows 8 operating system on all new government computers.
The move by the Central Government Procurement Centre is a bid to "ensure computer security", the official Xinhua news agency reported.
Beijing's furious response came one day after the US on Mondaycharged five members of a shadowy Chinese military unit for allegedly hacking US companies for trade secrets.
Cyber-spying has long been a major sticking point in relations between the world's two largest economies, but Washington's move marked a major escalation in the dispute.
In the first-ever prosecution of state actors over cyber-espionage, a federal grand jury indicted the five on charges they broke into US computers to benefit Chinese state-owned companies, leading to job losses in the US in steel, solar and other industries.
US Attorney General Eric Holder called on China to hand over the men for trial in the steel city of Pittsburgh and said the United States would use "all the means that are available to us" should Beijing refuse.
President Barack Obama's administration "will not tolerate actions by any nation that seek to illegally sabotage American companies and undermine the integrity of fair competition", Holder told reporters.
"This case should serve as a wake-up call to the seriousness of the ongoing cyber threat," he added.
The grand jury indicted each of the five – Wang Dong, Sun Kailiang, Wen Xinyu, Huang Zhenyu and Gu Chunhui – on 31 counts, which each carry penalties of up to 15 years in prison.
Prosecutors said that the five officers belonged to Unit 61398 of the People's Liberation Army.
A report last year by US security firm Mandiant said the unit had thousands of workers operating from a nondescript, 12-story building on the outskirts of Shanghai to pilfer intellectual property and government secrets.
China's foreign ministry rejected the US indictment as "absurd" and suspended the activities of a bilateral cyber working group announced last year by US Secretary of State John Kerry.
The State Department voiced regret over China's move on the working group and said it expected a wide-ranging annual dialogue in July, for which Kerry is expected to visit Beijing, to go ahead as scheduled.
Leaks by former government contractor Edward Snowden have alleged widespread US snooping in China including into telecom giant Huawei – which has itself been the object of security allegations and whose attempts to penetrate the US market have been blocked by lawmakers.
Beijing – which has in the past accused the US of hypocrisy on the grounds that Washington conducts sweeping global surveillance – repeated those accusations Tuesday, with the defence ministry maintaining that China is "a staunch defender of cyber-security".
"The Chinese government and military have never undertaken nor participated in the theft of trade secrets" through cyber-espionage, it said.
Xinhua cited a spokesperson for China's State Internet Information Office as calling the US the biggest attacker of Chinese cyberspace.
It cited data from an official Chinese network centre as showing that from mid-March to mid-May, "a total of 2,077 Trojan horse networks or botnet servers in the US directly controlled 1.18 million host computers in China".
"China has repeatedly asked the US to stop, but it never makes any statement on its wiretaps, nor does it desist, not to mention make apology to the Chinese people," Xinhua said.