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China Denies Spying On U.S. Manufacturers

Beijing says claims that it is stealing U.S. manufacturing expertise are a 'smear attack' aimed at misleading public opinion of China.

BEIJING (AP) — Beijing on Monday attacked a U.S. congressional panel's warning about Chinese spying, calling it ''brazen interference'' in China's internal affairs.
 
The U.S.-China Economic and Security Review Commission said in its annual report to Congress last week that Chinese espionage represents the greatest threat to U.S. technology.
 
It called for counterintelligence efforts to stop China from stealing U.S. manufacturing expertise and warned that small and medium manufacturers ''face the full brunt of China's unfair trade practices, including currency manipulation and illegal subsidies for Chinese exports.''
 
Chinese Foreign Ministry spokesman Liu Jianchao, in a statement posted on the ministry's Web site, said the report ''ignores the fact of China's progress in the areas of politics, economics, and society, is rooted in prejudice, and brazenly interferes in China's internal affairs.''
 
''We have already raised serious representations with the U.S. side expressing our resolute opposition,'' Liu said.
 
China's response was typical in that it routinely denies any spying and almost never allows such accusations to go unanswered.
 
The commission's report came at a time when trade tensions are more raw than usual over America's yawning trade deficit with China, which rose 12 percent last month to $15.7 billion on total two-way trade of $26.7 billion.
 
China's economic policies create a trade relationship that is ''severely out of balance'' in China's favor, said the commission, which Congress set up in 2000 to investigate and report on U.S.-China issues.
 
Carolyn Bartholomew, the commission's chairwoman, told reporters that ''China's interest in moving toward a free market economy is not just stalling but is actually now reversing course.''
 
Liu's statement called the commission's report a ''smear attack'' aimed at misleading public opinion toward China.
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