China accused over global computer spy ring

• Dalai Lama and foreign ministries bugged 

• Cambridge researchers point finger at Beijing

An enormous electronic espionage programme run from servers in China has been used to spy on computers in more than 100 countries, according to two reports published at the weekend.

The reports, published by the universities of Cambridge and Toronto, detail a "murky realm" where cyber spooks infiltrate email, take over humble desktop computers and use them to spy on organisations, individuals and governments.

The reports name the system GhostNet, and claim that it has been used to attack governments in south and south-east Asia as well as the offices of the Dalai Lama. In two years, the reports suggest, the operation infiltrated 1,295 computers in 103 countries.

While one of the reports remains mute on the identity of the perpetrators, the other has no such qualms, warning that the Chinese government ran a series of cyber attacks on Tibetan exile groups. The Chinese foreign ministry could not be reached for comment.

"What Chinese spooks did in 2008, Russian crooks will do in 2010 and even low-budget criminals from less developed countries will follow in due course," conclude the Cambridge authors of The Snooping Dragon: Social Malware Surveillance of the Tibetan Movement.

But the authors of Tracking GhostNet argue that things may not be as they seem in the world of electronic espionage. "We're a bit more careful about it, knowing the nuance of what happens in the subterranean realms," said Ronald Deibert from the University of Toronto. "This could well be the CIA or the Russians. It's a murky realm that we're lifting the lid on."

The attacks were simple and direct. Infected emails bearing attachments or links to websites were sent to organisations including the private office of the Dalai Lama. Once opened, the virus allowed hackers to operate the host computer, including moving files and sending and receiving data. Their potential control was such that they could turn on an infected computer's camera and microphone, creating a surveillance bug.

The investigations began after Toronto researchers were asked by the Dalai Lama's offices to examine their computers. Officials had become concerned that communications were being intercepted. The researchers found that computers had been infected by a virus created by malicious software - or malware. That discovery led them to a group of servers on Hainan Island, off China. Other servers they tracked were based in China's Xinjiang Uyghur autonomous region, where intelligence units dealing with Tibetan independence groups are based.

"We uncovered real-time evidence of malware that had penetrated Tibetan computer systems, extracting sensitive documents from the private office of the Dalai Lama," researcher Greg Walton said. 

The 10-month investigation also detected bugged computers in the foreign ministries of several countries, including Iran and Indonesia, and in the embassies of India, South Korea, Taiwan, Portugal, Germany and Pakistan.

The reports come in the wake of the annual report of the US-China Economic and Security Review Commission, published in November, which found the computer systems of US government agencies and defence companies had been compromised by Chinese hackers.

The Snooping Dragon, produced by two researchers at Cambridge University's computer laboratory, warns that what they term "social malware surveillance" are likely to spread. Defence, they suggest, is almost impossible.  continues here

China may save the world from crisis and minimize USA’s financial supremacy

The Chinese economy is doing very well against the background of the global financial crisis, the chairman of the Chinese Central Bank, Zhou Xiaochuan said during a press conference yesterday. The financial system of the nation is stable, whereas the economy of the country continues to cope with the financial crisis well. The absence of the liquidity crisis in the country is a peculiar feature of the situation in the banking sphere of China, which differs the nation’s economy from those of the USA, the EU and the majority of other countries. 

China ’s powerful economy and enormous international reserves may eventually become the only potential platform for the recovery of the world economy. The Chinese GDP gained nine percent in the third quarter of the current year, having dropped 1.1 percent vs. the second quarter of 2008. Even if the national GDP reduces to 7.5 percent, as many analysts predict, the Chinese economy will continue to demonstrate outstanding dynamics. 

The leaders of France and Russia put forward a suggestion to hold the meeting of the Group of 20 on November 15 in Washington to discuss the issue of the crisis and the reform of the financial system. The summit will be presumably devoted to the revision of the dollar-oriented structure of the world’s financial system. The USA may be deprived of its right to act as the financial regulator of the world. 

The country with strong economy and currency that is capable of balancing the economic and financial power of the United States is supposed to make the landmark change. All other countries that have been invited for the summit will play supportive roles. 

It is not the first time, when the world attempts to decrease the USA’s global financial influence. The European Union has already tried to improve its position in world trade by means of introducing the joint European currency. However, the US economic power and the crisis in world’s leading economies did not let the global financial system change drastically. continues here

The Rise of China and the Future of the West
JOHN IKENBERRY

The rise of China will undoubtedly be one of the great dramas of the twenty-first century. China's extraordinary economic growth and active diplomacy are already transforming East Asia, and future decades will see even greater increases in Chinese power and influence. But exactly how this drama will play out is an open question. Will China overthrow the existing order or become a part of it? And what, if anything, can the United States do to maintain its position as China rises?

Some observers believe that the American era is coming to an end, as the Western-oriented world order is replaced by one increasingly dominated by the East. The historian Niall Ferguson has written that the bloody twentieth century witnessed "the descent of the West" and "a reorientation of the world" toward the East. Realists go on to note that as China gets more powerful and the United States' position erodes, two things are likely to happen: China will try to use its growing influence to reshape the rules and institutions of the international system to better serve its interests, and other states in the system -- especially the declining hegemon -- will start to see China as a growing security threat. The result of these developments, they predict, will be tension, distrust, and conflict, the typical features of a power transition. In this view, the drama of China's rise will feature an increasingly powerful China and a declining United States locked in an epic battle over the rules and leadership of the international system. And as the world's largest country emerges not from within but outside the established post-World War II international order, it is a drama that will end with the grand ascendance of China and the onset of an Asian-centered world order......Article conts (-)