This photo taken on February 3, 2013 shows the US and Chinese flags flying outside an office building in the downtown area of Chongqing, China.
Why U.S. and China mistrust threatens the internet
01:24 - Source: CNN

Editor’s Note: Kristie Lu Stout hosts “On China” on CNN International. This month’s episode premieres on Thursday at 4:30am ET and tackles cybersecurity.

Story highlights

U.S.-China relations are also strained by economic turbulence and events in the South China Sea

China was accused of being behind a massive hack of public data in the U.S. recently

U.S. intelligence chief admits America would probably have done the same

Hong Kong CNN  — 

Chinese President Xi Jinping is going to Washington next month – and it’s not shaping up to be a pleasant visit.

Tensions are rising on a number of fronts: The global impact of China’s market meltdown; island building in the South China Sea; and that persistent glitch in the U.S.-China relationship – cybersecurity.

The massive data breach at the U.S. Office of Personnel Management (OPM) made headlines for its sheer size. Targeting the data for almost 22 million people, it’s been called the worst breach of government-held personal data in U.S. history.

U.S. Director of National Intelligence James Clapper said that China is the “leading suspect” in the breach, though if the tables were turned the U.S. would have carried out a similar hack on China: “If we had the opportunity to do the same thing, we’d probably do it.”

READ: China’s latest cyberweapon: The Great Cannon

Fair game?

Let’s face it, OPM was an easy target.

U.S. cyber defenses were down. And in this era of digital “spy versus spy,” a cyber-breach of government data is often regarded as fair game.

Cyber espionage has become such an expected reality in geopolitics that U.S. Secretary of State John Kerry recently admitted that it’s “very likely” China – along with Russia – is reading his emails.

But that’s not the case with corporate espionage.

The U.S. pushes back harder – a lot harder – against the cyber theft of company data and trade secrets. “It is far more firm and that’s the line that the U.S. is trying to draw – ‘It’s okay to spy on governments, everybody does that. It’s not okay to spy on company secrets’,” Washington Post Beijing bureau chief Simon Denyer tells me in the latest episode of CNN’s “On China.”

READ: Study: China cybercensors attack outside its borders

What kind of corporate data is China going after?

“Trade secrets, it could be business plans, marketing plans, it varies. We’ve seen many, many industries targeted,” said Wias Issa, Asia-Pacific senior director of the computer security firm FireEye.

Two years ago, Mandiant – now a FireEye company – issued a landmark report that traced cyberattacks against 141 U.S. companies, across 20 industries, to a secret Chinese military unit.

READ: How China could have hacked U.S. government in 10 steps

Mandiant uncovered what is claimed was widespread Chinese state-sponsored cyber theft of trade secrets – a practice that could be rationalized by Beijing as a matter of state security.

“The economy is so central to the Communist Party’s legitimacy that spying for the sake of benefiting state-owned companies for example is part of the government’s national strategy,” said Denyer.

According to that analysis, China is hacking American companies to strengthen its economy and the Party. But that equation doesn’t sit well with Peking University scholar Zha Daojiong, who believes cyber theft should never be a shortcut for economic growth.

“Spying may be a part of the world for a company to cut corners in advancing itself, but for me as a scholar if I had a chance to inform politic