WASHINGTON — The White House is preparing to impose sanctions as early as next week on Chinese companies connected to the cyber theft of United States intellectual property.
The Obama administration has for months been preparing a raft of sanctions to respond to mounting commercial espionage from China. Three US officials said the sanctions would probably be unveiled next week, just weeks before Chinese President Xi Jinping makes his first state visit to America.
Officials have been divided over whether the administration should impose the sanctions before Mr Xi’s visit. Proponents argue that the US needs to show China that it is serious about tackling cyber espionage. But opponents worry that such timing would seriously damage the visit.
The State Department had been pushing for the sanctions to come after it, said people familiar with the situation. But law enforcement officials argued against waiting because of the serious nature of the cyber-attacks.
One official said the move would probably come next week, after the US Labour Day holiday. He said the White House wanted to avoid slapping China with sanctions immediately before the visit, to give China time to cool down before Mr Xi meets US President Barack Obama in Washington.
Officials are participating in White House meetings this week to finalise plans for the sanctions, according to people familiar with the talks.
The sanctions are expected to focus on cases involving economic espionage and theft of trade secrets, said people familiar with the cases. They will also probably be used as additional punishment in cases where indictments have already been handed down.
When Mr Xi lands in the US, he will be caught between three uncomfortable stories: The visit of Pope Francis, attacks against China on the presidential campaign trail, and the White House’s move to impose sanctions on Chinese companies and individuals.
China wants to boost Mr Xi’s status as a global leader, but his visit — which will include a 21-gun salute and a big banquet — will be overshadowed by the Pope’s, which will attract huge media coverage, and also the move to impose sanctions.
Ms Bonnie Glaser, a China expert at the Center for International & Strategic Studies, said sanctions would send a message that Washington was “really serious” about cracking down on commercial espionage. Some have argued that it would spark retaliation, but Ms Glaser said the US needed to accept the risk of retaliation to show the Chinese it was serious. “If we are fearful of Chinese retaliation, then we are self-deterring,” she said.
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