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Chinese government agencies are in the process of asking banking institutions to end their "_reliance_" on International Business Machines Corporation (IBM) equipment by removing their "_high-end_" servers from bank locations, according to an article published on the Business Week website. The report indicates that the Chinese government is currently reviewing whether this reliance "_compromises the nation's financial security_" as "_the dispute with the U.S. over spying claims_" escalates.

According to Business Week, the People's Bank of China and the Ministry of Finance are just two agencies in the Chinese government asking for this equipment to be removed and replaced "with a local brand as part of a trial program." According to the article, these actions come soon after federal prosecutors formally "_indicted five Chinese military officers for allegedly hacking into the computers of U.S. companies and stealing secrets_, "according to the article. The article notes that a May 25th report from the Financial Times stated that "_China ordered state-owned companies to cut ties with U.S. consulting firms._"

Jeff Cross, a spokesman for IBM, was quoted in the article to say, "IBM is not aware of any Chinese government policy recommending against the use of IBM servers within the country's banking industry. News reports now state that China's National Development and Reform Commission has not heard of any alleged directive to that effect. IBM is a trusted partner in China and has been for more than 30 years." As the article continues, Duncan Clark, chairman of BDA China Ltd., a Beijing-based consultant to technology companies, is quoted to say, "Security trumps everything. China doesn't need the U.S. companies in the way it did for the last few decades."

Read much more in the full article regarding how the Chinese are reviewing their relationships with American businesses. They respond to last week's indictments from U.S. prosecutors.

Written by Bryon Turcotte  /  May 28, 2014

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