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Last Modified: 05 Sep 2007
By: Channel 4 News

Mr Bush responded to allegations that Chinese hackers broke into a US defence email system at a news conference in Australia today.

"I'm very aware that a lot of our systems are vulnerable to cyber attack from a variety of places.

"And therefore, the first question should be - not to put questions in your mouth, Bret, but - what are you doing to defend America against cyber attack? Are you aware that we have vulnerabilities that people can hack into sensitive systems? And are you then providing expertise and technology necessary to defend?

"And the answer is, yes. We understand that we're vulnerable in some systems - some, by the way, more valuable than others - or less valuable than others, I guess is the best way to put it.

"In terms of whether or not I'll bring this up to countries that we suspect may - from which there may have been an attack, I may.

"In this instance, I don't have the intelligence at my fingertips right now. Whether it be this issue, or issues like intellectual property rights, I mean, if you have a relationship with a country, then you've got to respect the country's systems and knowledge base. And that's what we expect from people with whom we trade.

"Our relationship with China is complex. On the one hand, we appreciate the opportunity to trade goods and services.

"We certainly hope that China changes from a saving society to a consuming society. Right now, because of the lack of a safety net, many Chinese save for what we call a rainy day.

'We understand that we're vulnerable in some systems - some, by the way, more valuable than others.'
George Bush on security

"What we want is the government to provide more of a safety net so they start buying more US and Australian products. We want there to be a - the middleclass to feel comfortable coming into the marketplace, the global market place so that our producers can see the benefits directly with trade with China.

"By the way, our exports to China are up, Mr Prime Minister, which is positive. We still have got a huge trade deficit with China, which then causes us to want to work with them to adjust - to let their currency float. We think that would be helpful in terms of adjusting trade balances.

"We've got great relations with China from a diplomatic perspective. In other words, we're able to talk with them openly and candidly. But do we agree on every issue?

"Not at all. I mean, for example, I've spent time talking about dissidents who have been jailed. I'm concerned about the treatment of the Dalai Lama.

"I want China to be more aggressive when it comes to Iran. I'm interested to hear President Hu Jintao's attitudes toward the humanitarian crisis in Darfur.

"In other words, there's a lot of issues which we wish they would - wish they would have a different lean to their policy. So I'm going to discuss these with him.

'What we want is the government to provide more of a safety net so they start buying more US and Australian products.'
George Bush on trade with China

"But it' s best to be able to discuss these issues in an environment that is frank and open and friendly, as opposed to one in which there's tension and suspicion.

"And so when I say we've got great relations, I will sit down with the president and have a good honest, candid discussion, and he's going to tell me what's on his mind and I'm darned sure going to tell him what's on my mind.

"One area where we are making good progress is on North Korea. As you may remember, I shifted the whole strategic approach to North Korea.

"I'm convinced that it's more effective to have five countries to say to North Korea the same thing than just one country, so that if North Korea makes the decision not to honour their word, that there's a better chance that there's consequences that they'll feel.

"And so as a result of getting China to the table on North Korea, the North Koreans are going to realize there is a lot more than one voice.

"And China has been instrumental in helping move this process forward. Chris Hill, Ambassador Hill, briefed me and Secretary Rice this morning on the fact that North Korea still looks like they're going to honour their agreement to disclose and to shut down their nuclear programs which will be good for peace. Anyway, a long answer because it's a complex relationship."