China and Germany are moving towards a mutual no-hacking-for-economic-espionage pact, along the lines of agreements already signed between China and the the US and UK.

German Chancellor Angela Merkel told reporters after talks with Chinese Premier Li Keqiang that Germany was seeking a deal “very quickly”. Germany, ahead of the UK, is China’s largest trading partner in Europe.

Sandro Gaycken, a cybersecurity expert at Berlin’s European School of Management and Technology, and a specialist advisor brought in to develop the deal, explained its implications for German business.

“China is very active in economic espionage, and Germany has been an attractive target because of the many technological innovations are happening at Mittelstand companies that traditionally have weak IT-security systems,” she told Bloomberg.

China routinely denies engaging in the theft of commercial secrets. Few independent infosec experts believed these denials, with the consensus view being that China has industrialised malware creation and hacking on a grand scale through units of the People’s Liberation Army and other arms of the state.

Targets include foreign government, NGOs, activists, and hi-tech companies (most particularly aerospace and defence contractors).

Chinese officials said they wanted to work with Germany to combat industrial espionage and cybercrime. “We are against cyber theft and the stealing of trade secrets,” Keqiang said.

Any deal between China and Germany is likely to only cover economic espionage – and not signals intelligence or hacking against diplomatic and national security targets – as per earlier deals between China and the US.

The landmark Sino-US pact was signed during a US visit by Chinese President Xi Jinping last, following threats by the US to apply tougher economic sanctions in the absence of a deal. ®