LONDON – In a rare joint appearance with his British counterpart, FBI Director Christopher Wray warned Wednesday that the threat posed by the Chinese government to Western companies is “getting worse” and suggested China may be taking steps to insulate itself from economic repercussions if it invades Taiwan.

Speaking at the offices of MI5, Britain’s domestic security service, Wray focused on the threat Western businesses and governments face from what he called a relentless, multifaceted effort by China to compete unfairly in the global marketplace. He also said the Russian invasion of Ukraine may pose important lessons for geopolitics in Asia.

“As you all know, there’s been a lot of discussion about the potential that China may try to forcibly take over Taiwan,” Wray said. “Were that to happen, it would represent one of the most horrific business disruptions the world has ever seen.”

He spoke to a gathering of British business leaders, in what officials said was the first such event featuring the head of the FBI and the head of MI5.

Wray said he is confident that China “is drawing all sorts of lessons from what’s happening with Russia and its unprovoked invasion of Ukraine. And you should, too. We’ve seen China looking for ways to insulate their economy against potential sanctions, trying to cushion themselves from harm if they do anything to draw the ire of the international behavior. In our world, we call that kind of behavior a clue.”

Wray did not explain how the FBI deduced a connection between Chinese efforts to lesson the effects of sanctions and any potential planning for an invasion of Taiwan. In the West, some cybersecurity experts have been calling for more than a year for sanctions to be imposed on China for government-sponsored hacking campaigns against hundreds of companies.

The FBI director noted that when Russia was hit with tough sanctions following the Ukraine invasion, “there were a lot of Western companies that had their fingers still in their door when it slammed shut.”

Similar type of sanctions against China, he warned, could do harm to the world economy “at a much larger scale.”

Wray’s remarks represent the latest in several public warnings he has given about the dangers posed by China to U.S. and European economic interests. But Wednesday’s speech seemed designed to try to rally Britain’s business community to help fight Chinese hacking, theft of trade secrets and surreptitious lobbying on efforts ranging from human rights to the possibility – however slim – of a Chinese invasion of Taiwan.

The island has lived under military threat from Beijing since 1949, when Chinese Communist forces defeated the Nationalists in the Chinese civil war, prompting the Nationalists to flee to Taiwan and set up a rival government. For decades, there has been an uneasy peace. But the Ukraine invasion has renewed concerns that China might try to follow Russia’s example.

Taiwan officials caution that war is not imminent, pointing to their government’s close relationship with the United States and the island’s strategic significance. In May, President Joe Biden said the United States would defend Taiwan militarily in the event of an attack by China, before the White House backtracked on his statement, maintaining a long-running policy of ambiguity over the extent of U.S. assistance.

Speaking to reporters after the speech, Wray said he didn’t know if the Ukraine invasion increased the likelihood of China invading Taiwan. But he said China should see Russia’s experience in Ukraine – with the invasion triggering massive sanctions and a huge flood of assistance to Kyiv from Western nations – as a warning.

“I don’t have any reason to think their interest in Taiwan has abated in any fashion,” Wray said. “But we certainly hope that they are learning valuable lessons in what happens when you overplay your hand in the way that the Russians clearly have in Ukraine – driving like-minded countries together in a way that is pretty historic.”

Also Wednesday, the U.S. National Counterintelligence and Security Center issued a bulletin warning state and local officials to be wary of possible surreptitious attempts by China to influence them.

The bulletin says that “as tensions between Beijing and Washington have grown … [the Chinese government] has increasingly sought to exploit these China-U.S. subnational relationships to influence U.S. policies and advance [Chinese government] interests. Leaders at the U.S. state, local, tribal, and territorial levels risk being manipulated to support hidden [Chinese government] agendas.”

In London, MI5 Director General Ken McCallum said that his agency is running seven times as many China-related investigations as it was in 2018, and that China is at the “top” of the agenda of the intelligence-sharing relationship between the United States, Britain, Canada, Australia and New Zealand, often referred to as the “Five Eyes.”

McCallum said his colleagues “badly need” new national security legislation to better fight hacking and covert influence operations coming from China.

“The most game-changing challenge we face comes from an increasingly authoritarian Chinese Communist Party that’s applying covert pressure across the globe,” McCallum said. “This might feel abstract, but it’s real, and it’s pressing. We need to talk about it. We need to act.”

The joint FBI-MI5 speech comes amid an effort by the Biden administration to enlist allies, particularly Europe and Japan, in the effort to rein in what the U.S. government says are China’s worst abuses in hacking, espionage and influence operations.

A year ago the United States, the European Union and NATO formally accused the Chinese government of a sophisticated attack on Microsoft’s widely used email server – marking the first time NATO, a 30-nation alliance, had taken such a step.

That hack compromised more than 100,000 servers worldwide, and Microsoft alleged that it was done by a Beijing-backed hacking group that exploited several previously unknown flaws in the software.

McCallum said his agency was changing to deal with the growing threat, becoming “an organization focused as much on countering state threats as our still-vital role in countering terrorism.”

“Hostile activity is happening on U.K. soil right now,” he said. “We don’t need to build walls to shut ourselves off from the rest of the world. We do need to build our awareness, and make conscious choices to grow our resilience.”

—

Ellen Nakashima in Washington contributed to this report.

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