China rejects allegations it is behind the Microsoft cyber-attack in January and claims the accusations from Australia and its allies are a politically motivated smear campaign.

It has been alleged Beijing used freelance cyber criminals to hack Microsoft Exchange software to steal intellectual property and gain a commercial advantage.

China has hit back - alleging the CIA has been hacking government agencies, oil industry, internet companies and aerospace research facilities.

A Chinese Foreign Ministry spokesperson said, "China once again strongly urges the United States and its allies to stop accusing China of cybersecurity issues and withdraw the so-called prosecution."

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