UPDATE 1-Beijing says working with Google to resolve dispute

Thu Mar 4, 2010 8:44pm EST

* China in consultations with Google over dispute

* Google spokesman unavailable for comment

By Shao Xiaoyi and Doug Young

BEIJING, March 5 (Reuters) - China is in consultations with technology giant Google (GOOG.O) to resolve its dispute with the company, which has threatened to abandon the Chinese market over hacking and censorship concerns, said a Chinese official on Friday.

The comment came from Li Yizhong, minister of China's Ministry of Industry and Information Technology (MIIT), speaking on the sidelines of China's annual parliament.

A Google spokesman was not immediately available for comment.

Google sent shockwaves across business and political circles when it declared on Jan. 12 it would stop censoring Chinese search results, and said it was considering pulling out of the country.

Google said in January that it had detected a cyber attack originating from China on its corporate infrastructure that resulted in the theft of its intellectual property. Google said more than 20 other companies had been infiltrated [ID:nN12133127], and cited the attack, as well as Chinese Web censorship practices, as reasons for the company to consider pulling out of the country.

The dispute about Internet censorship has added to tensions about issues ranging from trade and the Chinese currency, to a meeting last week between U.S. President Barack Obama and exiled Tibetan leader the Dalai Lama.

The hacking issue made headlines again in late February after reports in the Western media that the attacks had been traced to two schools in China, and the writer of the spyware used had been identified as a Chinese security consultant in his 30s with government links.

The Chinese government has said that Google's claim that it was attacked by hackers based in China was "groundless." (Writing by Don Durfee; Editing Jacqueline Wong)

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