Society

ZTE Corp.'s finance chief said Washington should promote a fair business environment with less government interference, expressing frustration at the Chinese telecommunications-equipment maker's efforts to expand in the U.S.

ZTE and rival Huawei Technologies Co. have faced concerns in the U.S., Europe and India about potential Chinese government influence over the companies. ZTE encountered political obstacles when trying to supply network equipment to U.S. operator Sprint Nextel Corp.

Meanwhile, officials in China and the U.S. have called on each other to open their markets further.

"For Sprint last year, we should have had the qualifications to become their key partner. The government should promote a fair, equitable, normal and free commercial environment and it shouldn't interfere," Chief Financial Officer Wei Zaisheng said in an interview Wednesday.

Taiwan's Defense Ministry said it arrested a military general on suspicion of spying for China in the most high-profile cross-Strait espionage case in decades.

Taiwan government officials and some experts said the case highlights a determined effort by China to infiltrate the island's military despite warming economic and political ties between the two sides.

The Ministry of National Defense confirmed on Wednesday it arrested Maj. Gen. General Lo Hsien-che on suspicion of leaking confidential information to Chinese intelligence sources after he was approached by Chinese operatives in 2004 while he worked in Thailand as a military attache.

Although it remained uncertain just what information Gen. Lo might have leaked, the arrest could complicate further U.S. military sales to Taiwan, according to Chih-cheng Lo, president of the Taiwan Brain Trust, a think-tank that advocates independence for the island, which China claims as its own.

China is building strategic reserves in rare-earth metals, an effort that could give Beijing increased power to influence global prices and supplies in a sector it already dominates.

Details of the stockpiling plans haven't been made public. But the outlines of the effort have emerged in recent statements from Chinese government agencies, state-controlled companies and reports in government-run media. The reports say storage facilities built in recent months in the Chinese province of Inner Mongolia can hold more than the 39,813 metric tons China exported last year.

China controls more than 90% of current global supply of rare-earth metals—a group usually classified as 17 elements and sometimes are called "21st Century gold" for their importance in such high-tech applications as laser-guided weapons and hybrid-car batteries. Beijing has been tightening its exports with a quota policy.

Hong Kong's securities regulator is seeking a court order to freeze assets of China Forestry Holdings Co. Chief Executive Li Hanchun, who sold a stake in the company just two weeks before trading in its shares was halted and possible accounting irregularities were disclosed.

The Securities and Futures Commission is also applying for a High Court order restraining Mr. Li from dealing in China Forestry's shares "whilst in possession of unpublished information about accounting irregularities in the company," according to a court document filed Monday.

The latest move underscores the regulator's efforts to fight market misconduct following several high-profile criminal prosecutions of insider-dealing activity in recent years.

China Forestry, which was listed in December 2009 and counts private-equity firm Carlyle Group LLC as a major shareholder, said Jan. 13 that Mr. Li had sold 119 million of the company's shares at 3.35 Hong Kong dollars (43 U.S. cents) each in a placement handled by Standard Chartered PLC, raising HK$398.7 million (US$51.2 million). With the transaction, Mr. Li's stake in the company fell to 2.46% from 3.9%.