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[WASHINGTON] The United States is considering economic sanctions against Chinese firms and individuals that profited from cyber attacks on American targets, a senior administration official said on Monday.
Following a spate of hacking attacks on US companies and government agencies that have been widely blamed on China, the official told AFP that Washington would respond "in a manner and timeframe of our choosing."
In April, President Barack Obama signed an executive order paving the way for tougher sanctions against "malicious cyber actors." "The administration is pursuing a comprehensive strategy to confront such actors," the official said, confirming a report that first appeared in the Washington Post.
"That strategy includes diplomatic engagement, trade policy tools, law enforcement mechanisms, and imposing sanctions on individuals or entities.
The United States has struggled to build an effective deterrent against a wave of increasingly damaging cyber attacks.
The government's intrusion detection system "Einstein" recently failed to prevent a breach of sensitive data on millions of federal personnel.
But calibrating which attacks warrant diplomatic protests - and which require a more forceful response - has proven fraught.
A year ago, US prosecutors unsealed indictments leveling spying charges against five Chinese military personnel they believe hacked into US networks to profit Chinese firms.
But any broader move by the world's biggest economy to punish the second largest could have global political and economic consequences and would likely trigger retribution.
And it will be all the more controversial in the run-up to next month's much-anticipated state visit to Washington by Chinese President Xi Jinping.
US-CHINA TIES DEEP, BUT TENSE
State Department spokesman Mark Toner would not confirm that sanctions are already being drawn up but did reiterate Washington's concerns over the alleged economic espionage.
"We remain deeply concerned about Chinese government-sponsored cyber-enabled theft of confidential business information and proprietary technology from US companies," Mr Toner said.
He said Chinese hacking violates the privacy and "core freedoms" of people online and warned Beijing it would lose inward investment if foreign firms fear for their data.
US intelligence has also been accused of mounting cyber attacks to scoop up Chinese data - accusations reportedly supported by documents leaked by fugitive contractor Edward Snowden.
But Mr Toner repeated Washington's long-standing insistence that, whatever intelligence they seek, US spy agencies do not use it to give American firms an edge in the marketplace.
The world's economic giants have deep economic ties but a tense relationship.
The United States is an ally of Taiwan, which Beijing sees as part of its territory awaiting reunification, by force if necessary And Washington usually sides with Beijing's Asian neighbors in territorial disputes over sea lanes and island chains.
The sanctions, if they come about, would be designed to counter the unfair advantage Washington fears Beijing has developed by illegally gathering US economic intelligence.
But there is also deep concern in Washington about a series of hacks apparently aimed at gathering political intelligence, some of them blamed on hackers with Chinese or Russian links.
Citing US intelligence officials, the Los Angeles Times reported on Monday that Russian and Chinese foreign spy services are cross-indexing hacked databases to identify American agents.
Recent breaches of US federal government personnel files and email systems, when combined with private data such as medical record and airline bookings, could leave US spies exposed.