UK - security risks from Chinese network equipment

Britain could be shut down by hackers from China, intelligence experts warn

China has the ability to shut down Britain's vital services, including food or power supplies, because its companies are involved in upgrading telecommunications systems, according to intelligence officials.

Ministers have been warned that a new £10bn communications network being developed by BT is vulnerable to a potential attack from within the Communist state because it uses equipment supplied by Chinese telecoms firm Huawei.

Although the risk of anyone in China exploiting the capability is currently low, intelligence experts believe the impact of any such attack would be very high. Computers at the Foreign Office and other Whitehall departments were attacked from China in 2007 and the threat from foreign governments and big companies is believed to be greater than that posed by terrorists.

Alex Allan, chairman of the Joint Intelligence Committee (JIC), it thought to have briefed members of the ministerial committee on national security about the threat from China at a Whitehall meeting in January. Ministers were told steps to curb the potential threat have made little difference.

Huawei is China's biggest phone company and a major world supplier. Under a multi-million pound deal signed in 2005, it is providing key components for BT's new '21CN' network which will use internet technology to speed up communications on behalf of thousands of public agencies and businesses.

Among those who will be relying on the new network are the government's own intelligence agency GCHQ, Whitehall departments and the military.

BT would not comment on the issue and a Cabinet Office spokesman would only say the that government was working on ways to improve the security of Britain's key systems. Huawei, whose UK division is based in Basingstoke, Hants, was unavailable for comment.

Ministers have been reluctant to replace Huawei with a British supplier, citing the cost and the government's policy on competitive tendering for contracts.

The Whitehall meeting heard that Huawei components that form key parts of BT's new network might already contain malicious elements that could be activated by China and which could "remotely disrupt or even permanently disable the network", according to a report. Such action would have a "significant impact on critical services" such as power and water supplies, food distribution, the financial system and transport, which were dependent on computers using the communications network to operate.