‘Two sessions’ 2024: US trade sanctions, software gap taking toll on China’s cybersecurity ambitions

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Mounting US trade sanctions and domestic software that is lagging behind American-made technology pose the biggest threats to China’ cybersecurity, according to the chairman of one of the country’s leading cybersecurity companies.

The manufacturing of cybersecurity products depends on high-end chips and software, and “supply disruptions of these products are affecting [China’s] ability to produce high-performance cybersecurity products,” Qi Xiangdong, the chairman of Beijing-based cybersecurity firm Qi An Xin (QAX), said in an interview with Shanghai media outlet The Paper on Sunday.

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Qi is also a member of the Chinese People’s Political Consultative Conference, the country’s top political advisory body.

Cyberattacks are becoming increasingly covert and unpredictable, requiring that technologies improve to better detect threats, and “only by innovating at a faster pace can we outpace cybercriminals”, Qi said according to the report.

Most leading hardware and software technology is still being produced by Western countries, Qi said, which gives them a natural advantage in collecting intelligence about vulnerabilities to cyberattacks.

Qi Xiangdong, the chairman of cybersecurity firm Qi An Xin (QAX) is warning that US-led trade restrictions are hampering China’s ability to stay ahead of cyberattacks. Photo: Handout

QAX gained international recognition when it served as the official cybersecurity services and antivirus software sponsor for the Beijing 2022 Winter Olympics – an international sports event that has attracted the attention of hackers around the world.

A QAX subsidiary recently helped Chinese police track down people using Apple’s file-sharing feature AirDrop to circulate “inappropriate speech”. The service was widely used during protests against strict Covid-19 restrictions in 2022 and in 2019 during anti-government unrest in Hong Kong.

Qi also said Sora, a groundbreaking technology generative AI model launched by US firm OpenAI in February, is even more powerful than ChatGPT, a chatbot that was launched in November 2022.

Qi said Sora had already been used to carry out cyberattacks, adding that “only by leveraging AI capabilities to accelerate the innovation in cybersecurity technology and protection systems, we can outpace AI technology itself”, according to the report.

Qi’s remarks came as China is seeking to leverage AI to drive economic growth while maintaining strict regulatory control over cybersecurity.

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Last week, in his maiden government work report, Chinese Premier Li Qiang introduced an AI+ initiative to integrate AI into traditional sectors to help stimulate economic growth and create momentum for technology improvements.

But despite efforts to promote domestic advances in science and technology to transform the Chinese economy, Beijing is facing growing pressure under US technology curbs amid an intensifying US-China rivalry in which AI has become one of the main battle fronts.

US sanctions have squeezed Chinese access to key tools, such as advanced graphics processing units from Nvidia, the world’s leading AI chip designer, which had up to 90 per cent of market share in China’s AI chip market before mounting US trade sanctions restricted exports to the mainland.

This has prompted leading Chinese tech firms, such as Huawei and ZTE, to ramp up investment in research and development of their own AI chips.

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