A congressional advisory board says the purchase of internet-linked gadgets manufactured in China leaves the United States susceptible to security breaks that could put critical substructure at risk.

In its annual report on Wednesday, the US-China Economic and Security Review Commission cautions of risks to the US government and private sector from a dependence on worldwide supply chains connected to China, which is the world's biggest producer of data innovation hardware.

China's push to take over the high-tech manufacturing sector by 2025 already is a sore point with Washington and a contributing component in trade tensions that have seen the world's two biggest economies slap billions of dollars in disciplinary tariffs on each another's products this year.

The US also has had long-running worries about state-backed cyber robbery of corporate secrets, something that China agreed to stop in 2015.

However, the bipartisan commission highlights the potential security dangers to the United States by China's pre-prominence in the so-called Internet of Things, or IoT, which talks about the increase of physical gadgets that have sensors that gather and share information and connect with the internet.

Such gadgets could be everything from home appliances like refrigerators and air conditioners to warehouse delivery coordinations, smart traffic signs, and aerial drones.

The commission, which does not set policies but rather can make proposals to Congress and the US administration, is cautioning that the potential effect of noxious cyberattacks through such frameworks will increase with the selection of ultra-quick 5G systems that could enliven information speeds by up to multiple times.

“The lax security protections and universal connectivity of IoT devices creates numerous points of vulnerability that hackers or malicious state actors can exploit to hold US critical infrastructure, businesses, and individuals at risk,” the report says.


The United States has now taken some steps to limit the use of Chinese-made high innovation. For example, it has limited government acquirement from Chinese tech goliaths Huawei and ZTE, which deny their products are used for spying by China's authoritarian government.

In June, the Defense Department impeded the purchase of all commercial, off-the-rack drones until a cybersecurity risk evaluation plan was proven. In 2017, US customs authorities alleged that drones manufactured by Chinese organization DJI, which has dominated the US and Canadian drone markets, probably provided China with access to US critical substructure and law enforcement data. DJI denied the allegation.

The commission is calling for Congress to push for appraisals by US government offices on their supply chain susceptibilities. It says the US government relies upon business, off-the-rack products, lots of them made in China, for more than 95% of its electronics components and information technology systems.

Large US telecommunications suppliers also depend on worldwide supply chains dominated by Chinese producers. Although they do not source directly from Huawei and ZTE, major US telecommunications suppliers depend on other foreign 5G network equipment providers that incorporate Chinese manufacturing in their supply chains.

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