The US-China Economic and Security Review Commission gave a warning of dangers to the US government and private sector from a reliance on global supply chains linked to China, which is the world’s largest manufacturer of information technology equipment.
It appears that China’s aggressive push to dominate the high-tech industry by 2025 already is a sore point with Washington and a contributing factor in trade tensions that have seen the world’s two largest economies slap billions of dollars in punitive tariffs on each other’s products this year.
The US also has had long-running concerns about state-backed cyber theft of corporate secrets, something that China agreed to stop in 2015. But the bipartisan commission highlights the potential security risks to the United States by China’s pre-eminence in the so-called Internet of Things, or IoT.
China’s role as an economic and military competitor to the United States creates enormous economic, security, supply chain, and data privacy risks for the United States,” the report says.
The commission, is warning that the potential impact of malicious cyberattacks through such systems will intensify with the adoption of ultra-fast 5G networks that could quicken data speeds by up to 100 times.
Their report says “The lax security protections and universal connectivity of IoT devices creates numerous points of vulnerability that hackers or malicious state actors can exploit to hold US critical infrastructure, businesses, and individuals at risk,”
The United States has already restricted government procurement from Chinese tech giants Huawei and ZTE, which deny their products are used for spying by China’s authoritarian government.
In June, the Defense Department suspended the purchase of all commercial, off-the-shelf drones until a cybersecurity risk assessment strategy was established. In 2017, US customs authorities alleged that drones produced by Chinese company DJI, which has dominated the US and Canadian drone markets, likely provided China with access to US critical infrastructure and law enforcement data. DJI denied the allegation.
The commission is calling for Congress to push for assessments by US government agencies on their supply chain vulnerabilities.