China blacklists Apple, Cisco, and other US tech companies

US network equipment maker Cisco Systems Inc has 60 products on China’s Central Government Procurement Center (CGPC) ban list. — Reuters pic

BEIJING, Feb 27 — China has dropped some of the world’s leading technology brands from its approved state purchase lists, while approving thousands more locally made products, in what some say is a response to revelations of widespread Western cyber surveillance.

Others put the shift down to a protectionist impulse to shield China’s domestic technology industry from competition.

The lists cover smaller-scale direct purchases of technology equipment, and central government bodies can only buy items not on the list as part of a competitive tender process.

Chief casualty was US network equipment maker Cisco Systems Inc, which in 2012 counted 60 products on the Central Government Procurement Center’s (CGPC) list, but had none left by late 2014, a Reuters analysis of official data shows.

Smartphone and PC maker Apple Inc has also been dropped over the period, along with Intel Corp’s security software firm McAfee and network and server software firm Citrix Systems.

The number of products on the list jumped by more than 2,000 in two years to just under 5,000, but the increase is almost entirely due to local makers.

The number of approved foreign tech brands fell by a third, while less than half of those with security-related products survived the cull.

An official at the procurement agency said there were many reasons why local makers might be preferred, including the fact that domestic security technology firms offered more product guarantees than overseas rivals.

China’s change of tack coincided with leaks by former US National Security Agency (NSA) contractor Edward Snowden in mid-2013 that exposed several global surveillance programmes, many of them run by the NSA with the cooperation of telecom companies and European governments.

“The Snowden incident, it’s become a real concern, especially for top leaders,” said Tu Xinquan, Associate Director of the China Institute of WTO Studies at the University of International Business and Economics in Beijing. “In some sense the American government has some responsibility for that; (China’s) concerns have some legitimacy.”

- Source: Reuters