The Cybersecurity Association of China (CSAC) demanded a review of Intel’s offerings in China, claiming that the US chipmaker poses a serious national security risk. CSAC is not a government entity, but it is deeply linked to the Chinese state, and public comments on WeChat on Wednesday suggest that China’s cyberspace watchdog agency, the Cyberspace Administration of China (CAC), might pursue Intel. The group’s blog article in particular blames Intel’s products, including its widely deployed Xeon processors, for having vulnerabilities that make Chinese systems vulnerable to backdoor attacks claimed to be run by the US National Security Agency (NSA).
Intel’s China division also reaffirmed its commitment to product safety and quality, noting that it is working closely with the Chinese authorities to resolve any concerns. Though the CAC has not yet commented on the matter, Intel’s shares slumped 1.5% amid an overall tech market sell-off in part because of concerns over ASML, another chip giant.
CSAC’s move is part of a growing wave of technology security fears that surround foreign companies. This year, the CAC stopped infrastructure operators in China from using US-based Micron Technology products following the same security allegations. For Intel, this recent call for inquiry might be detrimental to sales, with more than a quarter of its sales globally coming from China.
The matter also reveals deeper geopolitical tensions between the US and China, who are locked in a technological stalemate. For fear of restricting China’s access to the most powerful chip technologies, the US has placed export bans on Nvidia’s powerful AI chips for sale to Chinese companies. Intel, for its part, has continued to win large orders in China, including orders for its Xeon processors from state-backed agencies for AI tasks. However, the ban or even a moratorium could reduce the number of high-end chips in China, making it hard for the market to supplant Intel’s technology with few alternatives.
The CSAC alleges that Intel products pose threats to vital information systems and insists on tougher policies to “protect China’s national security.” Experts fear the increased trade barriers will provoke revenge and further undermine the already fragile US-China relationship.
