China computer security foreign Communist China continues to go to extremes and has ordered its banks and other major companies to limit the use of computer security software developed outside of China. That means popular antivirus vendors will lose existing and potential business inside mainland China, and setting up an impending trade clash with the USA and Europe. Of course this is just like China as they continue to build up their own technology sector by hiding away from global competition. If you ask me, it seems pretty apparent that China is aggressively shutting out competition.

Considering the population of China software developers know that this is a very large viable market, and being shutout is definitely a frustration.

A manager of an inspection company said 10 to 20 per cent of enterprises that its technicians looked at in higher security tiers used technology from Cisco and other foreign providers. He said they were told to switch to or add Chinese-made firewalls or other technology.

“We asked clients to make changes and warned them they would fail to pass the inspection if they don’t,” said the manager at Guangdong Southern Information Security Industrial Base Co. He would give only his surname, Chen.

Essentially this Multi-Level Protection Scheme (MLPS), requires that core security software that is used by government and major companies that support major infrastructure (banks, transportation, airports etc…) must be provided by Chinese companies only. Foreign companies are being pushed to disclose encryption technology, which of course comes on the heels of some nations threatening to disable Blackberry service. So what does this make you think? Does this come as a surprise? I don’t think the majority of Westerners are at all surprised by a move like this. And it really isn’t a surprise since it’s been alluded to and in the works for over three years by the Chinese government. To what extent this may effect foreign developers we can only speculate. As I understand it many American and European firms were targeting China as a market that had the potential to pull them out of the recent recession. Now that they’ve been effectively shutout they’ll have to turn their attention elsewhere… but where?

Sources: Joe McDonald, Canadian Press  Computer World, China Policy could force foreign security firms out.