More Pain For Chinese Techs Like Huawei, Alibaba As UK Warns Against Rising Threat From Beijing

During a rare speech in London, the head of the U.K. equivalent of the National Security Agency focused on the rising threat from Beijing. 

Jeremy Fleming, the director of Britain's Government Communications Headquarters, said Beijing used an array of existing and emerging technological means, including digital currency and satellites, to control markets and people, extend surveillance and censorship, and export its authoritarian system worldwide.

Calling it "the national security issue that will define our future," Fleming said the Chinese Communist Party leadership has "deliberately and patiently set out to gain strategic advantage by shaping the world's technology ecosystems," the Wall Street Journal reported.

China said its technological development aimed to improve the lives of the Chinese people and did not pose any threat. Fleming said Beijing has effectively broadened the definition of national security such that technology was a battleground for control, values, and influence. 

He said Beijing sought to create "client economies and governments" by exporting technologies around the globe. Western officials have long warned against Huawei Technologies Co's misuse of telecom gear to conduct digital espionage.

Fleming said that Beijing's central-bank digital currency could allow it to monitor transactions and evade international sanctions. He said China's Beidou satellite system was likely an alternative to the established Global Positioning System network.

Fleming urged the Western powers to invest more in emerging security technologies, like quantum computing, and increase collaboration with industry to blunt China's ambitions.

Fleming addressed Russia's invasion of Ukraine, saying that significant miscalculations by Vladimir Putin had led to staggering costs on the battlefield.

Shares in top Chinese chipmakers shed $7.7 billion in market value on October 10, as new U.S export controls restricted the sale of semiconductors made with U.S. technology unless vendors obtain an export license.

The U.S. also barred its citizens or entities from working with Chinese chipmakers without explicit approval and limited the export of manufacturing tools.

Shares in Chinese tech giants Alibaba Group Holding Limited BABA and Tencent Holding Ltd TCEHY, along with the chipmakers, slumped following the export control measures.

Price Action: BABA shares closed lower by 4.83% at $75.41 on Tuesday.

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