CHINA 2021  (page 1)

The U.S.-China Economic and Security Review Commission The U.S.-China Economic and Security Review Commission (USCC) was created by the United States Congress in October 2000 with the legislative mandate to monitor, investigate, and submit to Congress an annual report on the national security implications of the bilateral trade and economic relationship between the United States and the People’s Republic of China, and to provide recommendations, where appropriate, to Congress for legislative and administrative action.

USCC’s Trade Bulletins: January 2021 / February 2021 / March 2021 / April 2021 / May 2021 / June 2021 / July 2021 / August 2021 / September 2021 / October 2021 / November-December 2021

Under the Radar: Mapping the Czech and Slovak local governments’ ties to China The new policy paper prepared by the Central European Institute of Asian Studies (CEIAS) in collaboration with the Association for International Affairs (AMO), provides a comprehensive account of Czech and Slovak paradiplomatic activity towards China. Classifying and investigating sub-national relations plays a crucial role in ‎our understanding of China-Europe relations and the actors involved ‎in them. With China becoming an increasingly salient topic of ‎discussion in Czech and Slovak politics, we aim to zoom in on the ‎increasing importance of paradiplomatic relations of municipal and ‎regional administrations with their Chinese counterparts.‎ To this end, we have conducted an extensive mapping of interactions with China on ‎the sub-national level in Czechia and Slovakia.‎
The study takes into account the 8 self-governing regions of Slovakia ‎and 13 self-governing regions of Czechia and the capital city Prague. On the municipal level, we have investigated the ties with China ‎among 79 county-level cities in Slovakia. In Czechia, the study ‎included 205 municipalities with extended powers. ‎ Given the particularities of municipal organization in some larger ‎cities (e.g. Prague in Czechia, or Bratislava and Košice in Slovakia), ‎we have also considered their districts as independent actors, given ‎that they elect their mayors and councils, and perform independent ‎self-governance functions. In Bratislava, 17 such municipal districts ‎were included. A study done in Košice included 22 districts. Similarly, ‎in Prague, 22 districts were included in the study.‎

Nicaragua’s Flip to China: What Does It Mean for the Region?  Nicaragua’s diplomatic flip from Taiwan to the People’s Republic of China (PRC), announced on December 9, was almost inevitable, but it will accelerate a worrisome trend in parts of the Western Hemisphere closest to the U.S. to a China-funded form of authoritarian populism. That growing threat, in a part of the hemisphere once considered politically allied or at least compliant with the U.S., will also include secondary risks from an expanded presence by other U.S. rivals such as Russia and Iran, expanded drug and other organized crime flows through the region, and decreased security cooperation. That combination will have grave strategic consequences for the United States. The U.S. has received many wake-up calls on the mounting strategic challenges in its own near abroad, with which its security and prosperity are intimately connected through ties of commerce, geography, and family. Every time, it has hit the snooze button.
The timing of the announcement of Nicaragua’s diplomatic flip to the PRC, coinciding with the Biden administration’s Summit for Democracy, was likely no accident. It is a harsh reminder that Central American governments and others have very real options to ally themselves with extra-hemispheric actors threatening the United States, if the U.S. treats them with contempt or disinterest. The days in which the U.S. had the luxury of strong-arming compliant Central American partners, whether over corruption, democracy, or immigration, are over. Washington no longer has the luxury to not act strategically. More in the December 10, 2021 article in Global Americans.

When Will China Rule the World? Never?  In 2021, the U.S. economy outgrew China’s for the first time in decades. A lot of that is due to this being a recovery year for the United States, but some economists have increasingly speculated that China may never catch up. But Beijing has much more immediate problems such as the rolling property crisis (there is no sign that it will ease in 2022, especially since the government doesn’t seem to have the confidence to curb the sector) which goes beyond China Evergrande Group and severe local government shortfalls. Local governments are grappling with debt loads that have been building for years. But many are also struggling to meet regular obligations, such as welfare and paying salaries.

AI and the Future of Disinformation Campaigns / Part 1: The RICHDATA Framework  Artificial intelligence offers enormous promise to advance progress, and powerful capabilities to disrupt it. This CSET policy brief is the first installment of a series that examines how advances in AI could be exploited to enhance operations that automate disinformation. Introducing the RICHDATA framework—a disinformation kill chain—this report describes the stages and techniques used by human operators to build disinformation campaigns.

AI and the Future of Disinformation Campaigns / Part 2: A Threat Model  Artificial intelligence offers enormous promise to advance progress and powerful capabilities to disrupt it. As deepfakes and other AI-generated content become popularized, they generate much angst about their use as tools for digital impersonation and disinformation campaigns. Yet, deepfakes provide just one example of how AI may be misused to increase polarization and undermine trust. This CSET policy brief is the second installment of a series that examines how advances in AI could enhance the operations to automate disinformation campaigns. It builds on the RICHDATA framework to demonstrate how machine learning can supercharge the building blocks of campaigns, augment human operators in a human-machine disinformation team, and increase the scale and personalization of disinformation. The report offers recommendations to mitigate this evolution’s worst effects.

Containing Crisis – Strategic Concepts for Coercive Economic Statecraft on China  As the United States and China seek to manage an increasingly tense relationship, both sides have turned to coercive economic statecraft as a core part of their broader foreign policy, with disruptive impacts on the global economic order. A growing body of research examines the use of coercive economic tools, including prior work by the CNAS Energy, Economics, and Security program. This report adds to that literature by specifically examining the use of coercive economic tools during periods of geopolitical crisis to assess their value in de-escalating tensions or deterring further economic coercion. The researchers developed scenario exercises to examine these dynamics, supported by a literature review and extensive engagement with subject matter experts. The insights from the research informed the development of two overarching strategic concepts intended to guide U.S. policymakers when deploying economic tools as part of a crisis management situation.
From the scenario exercises and further research, the research team identified the following insights into how the United States and China may deploy coercive economic tools in times of crisis:

  • China may be willing to deploy the widest range of economic tools in response to a geopolitical conflict.
  • While both China and the United States may be willing to accept negative economic impacts to pursue geopolitical objectives, both also demonstrate a preference to broadly retain access to the other’s market, which may constrain the use of the most extreme forms of economic coercion.
  • Countries other than the United States may be more reticent to take coercive economic actions against China due to fears of possible negative economic and political consequences.
  • The United States may be advantaged by its alliances, and its ability to act jointly with allies may compensate for the narrower set of economic tools the United States is willing to use to manage geopolitical tensions.
  • Persuasive rather than coercive tactics may best improve the United States’ negotiating position when it seeks to use economic statecraft to manage geopolitical tensions.

Based on these insights, the research team recommends that the United States use the strategic concepts of joint pressure and bound engagement to guide its coercive economic statecraft policy. The United States, coordinating with like-minded countries, should deploy joint pressureon China when using economic tools to respond to geopolitical escalation. Rather than acting alone, the United States should coordinate its responses with partner countries to maximize pressure on China, strengthen the ability of the United States to impose costs, and minimize China’s ability to retaliate. While certain circumstances may require the United States to act unilaterally or as a first mover, this should be a rare exception to the general posture of joint pressure. The United States should have a strategy of bound engagement, by which it engages in economic escalation in a manner bound by constraints embodied in domestic and international rules and norms. This may include a domestic legal framework for use of economic tools, binding international trade and investment rules, or norms such as the concept of a proportionate response to a provocation. It may include rules by which both the United States and China are bound, such as World Trade Organization obligations, or rules that the United States develops with partners to guide joint coercive economic statecraft and to which China is not a party.

BIS 15 CFR Part 744: Addition of Certain Entities to the Entity List and Revision of an Entry on the Entity List  This final rule from the Bureau of Industry and Security amends the Export Administration Regulations (EAR) by adding thirty-seven entities under forty entries to the Entity List. These thirty-seven entities have been determined by the U.S. Government to be acting contrary to the foreign policy or national security interests of the United States and will be listed on the Entity List under the destinations of the People’s Republic of China (China), Georgia, Malaysia, and Turkey. This final rule also modifies one existing entry on the Entity List under the destination of China.

H.R.6256: To ensure that goods made with forced labor in the Xinjiang Uyghur Autonomous Region of the People’s Republic of China do not enter the United States market, and for other purposest  After more than a year of debate in the U.S. Congress as to the scope and enforceability, the Uyghur Forced Labor Prevention Act (UFLPA) passed Congress in December 2021 with strong bipartisan support. President Biden publicly supported the legislation and signed it into law on December 23, 2021. The scope of the UFLPA is broad and has the potential to impact a range of high-technology and low-technology industries with supply chain links to the People’s Republic of China (PRC), no matter how remote.

Detect and Understand: Modernizing Intelligence for the Gray Zone  Discerning knowable truths amid obfuscation, misdirection, and outright lies is a fundamental mission of intelligence. Former Central Intelligence Agency (CIA) director Allen Dulles held this notion so deeply that he insisted that a biblical exhortation to pursue the truth be carved in stone in the CIA’s lobby. Unfortunately, the challenge—as Pascal mused 300 years prior to the construction of the CIA’s Original Headquarters Building—is that global politics are conducted in a world riven with multiple “truths.” This was a constant of the Cold War, when competing narratives informed an era of great power competition. And the same is true today, when interstate competition once again defines a security landscape muddled by ambiguity, confusion, and deception. There is a rich body of literature describing how the modern era of competition will be dominated by actors advancing their interests via malign activities in the so-called “gray zone” between peace and war. These studies have analyzed the specific ways that actors such as China, Russia, Iran, and others operate below the threshold of conventional war and mix political, economic, information, and military tools to increase their global legitimacy and advance their interests at the expense of the United States and its allies. Since the height of the Cold War, the fields of coercion, bargaining, and deterrence have studied why actors pursue these strategies; namely it is to achieve limited goals without incurring the risk of escalation into a costly and potentially devastating war.
This CSIS study extends the existing body of research on the gray zone further into the specific areas of intelligence collection and analysis. It offers a range of recommendations to improve the ability of U.S. intelligence services to confront the gray zone challenges of modern interstate security competition. In support of this effort, CSIS researchers undertook a six-month project that set out to answer the following three questions:

  • How do gray zone threats challenge the ability of intelligence planners, collectors, and analysts to deliver timely and accurate analysis and warning?
  • How can emerging technologies augment the detection and analysis of gray zone activity?
  • What changes across the areas of collection, analysis, and organizational structure could improve the U.S. intelligence community’s (IC) ability to identify, assess, and warn of threats in the gray zone?

The NeurIPS 2021 / Outstanding Paper Awards The 35th edition of NeurIPS concluded last week, offering an overview of the state of AI and ML research and which companies, universities and countries are leading the way. Of the 2,344 accepted papers, U.S. researchers led the pack with 1,431, well ahead of China’s 411 and the UK’s 268. Among private industry-affiliated papers, Alphabet subsidiaries took first (Google, 177 accepted papers) and third place (Deepmind, 81), with Microsoft in second (116 accepted papers). University-affiliated papers, meanwhile, saw U.S. institutions take four of the top five spots — China’s Tsinghua University rounded out a top five led by MIT, Stanford, Carnegie Mellon, and UC Berkeley. Six papers took home Outstanding Paper Awards, while two were recognized with the new Datasets and Benchmarks Best Paper Awards. 

China in 2022 – a look ahead China is potentially facing a turbulent year: after the Beijing Olympic Games in February, the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC) will meet in March to begin preparations for the Chinese Communist Party’s most important event in 2022 – its 20th Congress in November. Xi Jinping is expected to use the time to lobby for and log in a third five-year term as CCP leader – a breach with a near-30-year practice that general secretaries step down after two terms, like presidents – and to prepare a reshuffle that could replace Prime Minister Li Keqiang and other top leaders with reliable Xi loyalists. That means 2022 will likely see Xi more openly exercise the power he has been building since having the term limit for the presidency removed in 2018 and declared himself “core” of the CCP akin to Mao Zedong and Deng Xiaoping in November. With Xi in power indefinitely, the CCP will double down on social and economic reforms flagged in 2021, the year it celebrated its centenary and declared “absolute poverty” eradicated. The CCP used the occasion to announce the time had come for a “new era” of development, loosely aimed at creating “common prosperity” – and chiefly defined by the leadership of Xi. The party’s confidence in its and Xi’s ability to rule was bolstered, for one, by China’s relatively successful zero-Covid strategy during the pandemic. The step-change in the CCP’s confidence in its ability to rule suggests that 2022 even more than 2021 will bring ideologically loaded party-led governance at home, and an assertive approach to controlling narratives and countering criticism of CCP rule abroad. MERICS made this special issue of their MERICS China Essentials available for free.

Harvard University Professor Convicted of Making False Statements and Tax Offenses Dr. Charles Lieber was found guilty of concealing his affiliation with the Wuhan University of Technology and his participation in China’s Thousand Talents Program. The former Chair of Harvard University’s Chemistry and Chemical Biology Department was convicted by a federal jury on December 21, 2021, in connection with lying to federal authorities about his affiliation with the People’s Republic of China’s Thousand Talents Program and the Wuhan University of Technology (WUT) in Wuhan, China, as well as failing to report income he received from WUT.

Charles Lieber / Photo: Katherine Taylor/Reuters

Dr. Charles Lieber, 62, was convicted following a six-day jury trial of two counts of making false statements to federal authorities, two counts of making and subscribing a false income tax return and two counts of failing to file reports of foreign bank and financial accounts (FBAR) with the Internal Revenue Service (IRS). U.S. Senior District Court Judge Rya W. Zobel will sentence Lieber at a later date that has not yet been scheduled. Lieber was indicted in June 2020 and was subsequently charged in a superseding indictment in July 2020.
Lieber served as the Principal Investigator of the Lieber Research Group at Harvard University, which received more than $15 million in federal research grants between 2008 and 2019. Unbeknownst to his employer, Harvard University, Lieber became a “Strategic Scientist” at WUT and, later, a contractual participant in China’s Thousand Talents Plan from at least 2012 through 2015. China’s Thousand Talents Plan is one of the most prominent talent recruitment plans designed to attract, recruit and cultivate high-level scientific talent in furtherance of China’s scientific development, economic prosperity and national security.

An FBI affidavit that lays out the case against Charles Lieber includes what federal prosecutors say is a contract between Dr. Lieber and the Wuhan University of Technology.

Under the terms of Lieber’s three-year Thousand Talents contract, WUT paid Lieber a salary of up to $50,000 per month, living expenses of up to $150,000 and awarded him more than $1.5 million to establish a research lab at WUT. In 2018 and 2019, Lieber lied to federal authorities about his involvement in the Thousand Talents Plan and his affiliation with WUT.
In tax years 2013 and 2014, Lieber earned income from WUT in the form of salary and other payments made to him pursuant to the Strategic Scientist and Thousand Talents Contracts, which he did not disclose to the IRS on his federal income tax returns. Lieber, together with WUT officials, opened a bank account at a Chinese bank during a trip to Wuhan in 2012. Thereafter, between at least 2013 and 2015, WUT periodically deposited portions of Lieber’s salary into that account. U.S. taxpayers are required to report the existence of any foreign bank account that holds more than $10,000 at any time during a given year by the filing an FBAR with the IRS. Lieber failed to file FBARs for the years 2014 and 2015. The charge of making false statements provides for a sentence of up to five years in prison, three years of supervised release and a fine of $250,000. The charge of making and subscribing false income tax returns provides for a sentence of up to three years in prison, one year of supervised release and a $100,000 fine. The charge of failing to file an FBAR provides for a sentence of up to five years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

Treasury Identifies Eight Chinese Tech Firms as Part of The Chinese Military-Industrial Complex the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) identified eight Chinese technology firms pursuant to Executive Order (E.O.) 13959, as amended by E.O. 14032. These eight entities actively support the biometric surveillance and tracking of ethnic and religious minorities in China, particularly the predominantly Muslim Uyghur minority in Xinjiang. “Today’s action highlights how private firms in China’s defense and surveillance technology sectors are actively cooperating with the government’s efforts to repress members of ethnic and religious minority groups,” said Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson. “Treasury remains committed to ensuring that the U.S. financial system and American investors are not supporting these activities.”
The entities identified are Cloudwalk Technology Co., Ltd.; Dawning Information Industry Co., Ltd.; Leon Technology Company Limited; Megvii Technology Limited; Netposa Technologies Limited; SZ DJI Technology Co., Ltd.; Xiamen Meiya Pico Information Co., Ltd.; and Yitu Limited.
Beginning in 2016, Chen Quanguo, the then-newly appointed Communist Party Secretary of the Xinjiang Uyghur Autonomous Region, stepped up security and surveillance measures aimed at the Uyghur population in Xinjiang. Such actions included the installation of thousands of neighborhood police kiosks and ubiquitous placement of surveillance cameras, collection of biometric data for identification purposes, and more intrusive monitoring of internet use. By some estimates, since 2017, Xinjiang authorities have arbitrarily detained between 1 million and 1.8 million Uyghurs and members of other ethnic and religious minority groups, including ethnic Kazakhs and others, in “reeducation” centers. On July 9, 2020, Chen Quanguo was designated pursuant to E.O. 13818, which builds upon and implements the Global Magnitsky Human Rights Accountability Act, for being a foreign person who is or has been a leader or official of an entity, including any government entity, that has engaged in, or whose members have engaged in serious human rights abuse relating to the leader’s or official’s tenure. The surveillance and tracking of ethnic and religious minorities in the People’s Republic of China (PRC) continue to this day. For identifying information on the entities identified, click here. For the U.S. Department of the Treasury’s press release, click here.

Whatever it takes to end it: Iran’s shift toward more oppressive governance Iran is becoming a more authoritarian and repressive state, which has direct implications for the future of the region and the Joint Comprehensive Plan of Action (JCPOA). The Iranian regime is intensifying its efforts to control the population and retain the ruling elite’s hold on power amid mounting domestic crises and instability. Regime leadership has always used repression to secure power, but recent trends indicate a change in the political establishment’s relationship with the Iranian people. The security services are building an increasingly adaptive and sophisticated police and surveillance state, improving their capability to violently suppress domestic dissent. US decision makers must recalibrate their policies vis-à-vis Tehran to reflect this new reality.
Restoring the JCPOA would not reverse Iran’s shift toward more repressive governance. A worsening internal security environment, which may intensify in the years ahead, is driving this transition. Popular protests and violence against the regime have swelled throughout the country in recent years, stoking the Iranian leadership’s fear of domestic instability. Civil disorder, largely driven by economic grievances, has become commonplace, testing the state’s defenses against its own people. Factors further exacerbating authorities’ concerns include the COVID-19 pandemic, the possibility that the US will someday resume a maximum-pressure policy, and political uncertainty in the lead-up to Supreme Leader Ayatollah Ali Khamenei’s passing.
The regime is optimizing its internal security apparatus for social control. Iranian authorities have adopted a three-pronged counterprotest strategy, incorporating prevention, force, and censorship. This approach relies on an expansive constellation of neighborhood patrols, paramilitary forces, and security bases—all designed, in part, to forecast when protests will occur and crush them early. The regime is increasingly involving its conventional military, named the Artesh, and possibly foreign proxy fighters in internal security missions. Advanced technologies are central to this counterprotest strategy. Iranian leadership sees the success of the Chinese Communist Party in controlling and monitoring its own population and seeks to partly emulate this model of social control. Iranian authorities have embraced the concept of internet sovereignty and are increasingly willing to disrupt the internet and telecommunications in Iran to abet their protest crackdowns. They are also investing in domestic surveillance infrastructure and artificial intelligence (AI) to suppress dissent. Iranian officials hope to harness AI’s analytical potential to synthesize a broad range of data streams collected through increasingly diverse digital means to identify and preempt internal security threats in real time. The regime’s more authoritarian mode of governance could change how it interacts with the region and the JCPOA. Iran’s rulers may come to perceive the success of their counterprotest strategy as a source of leverage and strength. The regime could believe that it can more effectively repress its citizens with little fear of consequence and that it is better prepared to survive without the economic benefits of the nuclear deal. Understanding this evolution from the Iranian leadership’s perspective can help US policymakers address the national security challenge Iran poses to the US and its allies and partners. Read AEI’s report.

Orban’s Hungary: A Russia and China Proxy Weakening Europe Today’s Hungary is adversarial to transatlantic interests and democratic values. Under Prime Minister Viktor Orban’s leadership, Hungary has embraced the efforts of authoritarian Russia and China to broaden and deepen their politico-economic influence throughout Central Europe. Hungary has become the primary staging ground for Russian and Chinese intelligence and influence operations targeting countries in the wider region. Hungary itself is a destabilizing force as it stirs irredentism in its near abroad while building alliances with authoritarian-leaning leaders throughout Southeast Europe. In response, Orban and his Fidesz Party should be increasingly contained and isolated until Hungary’s government decidedly foregoes actions that gravely compromise Euro-Atlantic security and values. EVCSP’s report is here. EVCSP, the European Values Center for Security Policy is a non-governmental, non-partisan institute defending freedom and sovereignty, and based in Prague. They protect liberal democracy, the rule of law, and the transatlantic alliance of the Czech Republic, and help defend Europe especially from the malign influences of Russia, China, and Islamic extremists.

Image: Encyclopædia Britannica, Inc.

Responding to Trade Coercion: A Growing Threat to the Global Trading SystemAs geopolitical tensions have increased in recent years, international trading relationships have become more politicized. Coercive trade practices – including quotas, anti-dumping measures and/or phyto-sanitary barriers – have emerged as one of the more concerning expressions of this trend. These actions work to harm trade partners economically in effort to apply political pressure as part of a broader diplomatic dispute. This presents a serious threat to the integrity of the rules-based trading system. Currently, existing trade instruments are unable to adequately address this growing concern. The World Trade Organization (WTO) is slow to respond, in the absence of a functioning appellate body, and coercive trade practices can be difficult to identify and quantify, allowing for many cases to go unreported. It will be critical for governments to find alternative tools for dealing effectively with trade coercion. To address this challenge, the Asia Society Policy Institute (ASPI) and the Perth USAsia Centre launched a joint report.

Team Telecom Recommends FCC Grant Google and Meta Licenses for Undersea Cable The Department of Justice announced that Team Telecom entered into National Security Agreements with Google LLC and its subsidiary GU Holdings Inc., and Meta Platforms Inc. (formerly known as Facebook Inc.) and its subsidiary Edge Cable Holdings USA LLC to protect data on the Pacific Light Cable Network (PLCN) system, an undersea fiber optic cable system that will connect the United States, Taiwan and the Philippines.
The agreements were made with the Departments of Justice (DOJ), Defense (DOD), and Homeland Security (DHS) in their roles as members of the committee for the Assessment of Foreign Participation in the U.S. Telecommunications and Services Sector (known informally as Team Telecom), and were coordinated with committee advisors listed in section 3(d) of Executive Order 13913 (2020). The Executive Branch has recommended that the Federal Communications Commission (FCC) condition any license to operate the PLCN system on compliance with the National Security Agreements.
“These agreements enable Google and Meta to take advantage of critical, additional cable capacity while protecting U.S. persons’ privacy and security through terms that reflect the current threat environment,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division, who leads Team Telecom’s work for the Justice Department. “This resolution also demonstrates Team Telecom’s ability to resolve complex cases involving critical infrastructure in a timely matter, thanks to recent reforms of our structure and process.” 
Under the National Security Agreements, Google and Meta (and their subsidiaries) have agreed to (among other terms):

  • Conduct annual assessments of risk to sensitive data that transits the PLCN cable system, including when the data exits the cable;
  • Pursue diversification of interconnection points in Asia, including but not limited to Indonesia, Philippines, Thailand, Singapore and Vietnam; and
  • Restrict access to information and infrastructure by Pacific Light Data Communications Co. Ltd (PLDC), the Hong Kong-based owner of PLCN that withdrew its application for an FCC license.

In June 2020, the committee publicly recommended that the FCC partially deny a previous application for PLCN with respect to PLCN’s proposed connections to Hong Kong and to the portions of the PLCN owned by PLDC. Shortly after that recommendation, the applicants withdrew the original PLCN application. Google’s and Meta’s subsidiaries then filed a new FCC application removing Hong Kong and seeking to operate only the United States, Taiwan and Philippines portions of PLCN. 
The National Security Agreements are justified by the current national security environment, including:

  • the PRC government’s sustained efforts to acquire the sensitive personal data of millions of U.S. persons;
  • the PRC government’s access to other countries’ data through both digital infrastructure investments and recent PRC intelligence and cybersecurity laws; and
  • changes in the market that have transformed subsea cable infrastructure into increasingly data-rich environments that are vulnerable to exploitation.

Through appropriate mitigation agreements like these, the committee seeks to protect the national security interests of the United States while preserving global access to U.S. information and communications technology systems. The Committee was established pursuant to Executive Order 13913, and the Attorney General’s role as Chair of the Committee is carried out by the Department of Justice’s National Security Division, Foreign Investment Review Section. The Department of Homeland Security and the Department of Defense are fellow members of the Committee.

US and Allies Fail to Pull Moscow Away From Beijing During a video-conference on December 15, Presidents Vladimir Putin of Russia and Xi Jinping of China hailed close political, military and economic ties, as well as promoted their mutual personal friendship. The two leaders demonstrated their defiance to Western pressure and threats of escalating sanctions from the United States and Europe. According to Putin’s foreign policy aide Yuri Ushakov, during the 1.5-hour-long discussion Xi insisted that although Russia and China are not treaty allies, their relationship “even exceeds an alliance

Chinese President Xi Jinping (right) holds a virtual meeting with Russian President Vladimir Putin in Beijing, capital of China, on December 15, 2021. Photo: Xinhua

Putin reportedly briefed Xi about his recent video-conference call with US President Joseph Biden on December 7. Moreover, Putin and Xi jointly condemned Washington’s “disruptive” policies. Xi supported the Russian demand of talks with the West on a comprehensive security arrangement in Europe and of legally banning any further eastward enlargement of the North Atlantic Treaty Organization (NATO) or the deployment of any Alliance weaponry close to Russia’s borders. The two heads of state also discussed enhancing mutual trade and technological and economic cooperation. Xi specifically thanked Putin for “solidly supporting Chinese efforts to defend its key national interests and adamantly resisting attempts [by third parties] to drive a wedge to separate our countries”. More in Jamestown’s Eurasia Monitor Volume 18, Issue 188. The author of the article is a Moscow-based defense analyst and columnist for Novaya Gazeta. He served as senior research officer in the Soviet Academy of Sciences, from where he received his Ph.D.

Meta (formerly Facebook) has banned six private spy companies and a Chinese network from its social media platforms In a new report (Threat Report on the Surveillance-for-Hire Industry’), Meta has warned that hired spies are secretly targeting journalists, human rights activists and political dissidents on behalf of corporations and governments to an extent not previously understood. “The global surveillance-for-hire industry targets people across the internet to collect intelligence, manipulate them into revealing information and compromise their devices and accounts,” the report states. The industry “provides intrusive software tools and surveillance services indiscriminately to any customer — regardless of who they target or the human rights abuses they might enable,” the report explained. A separate and related report (‘Pegasus vs. Predator: Dissident’s Doubly-Infected iPhone Reveals Cytrox Mercenary Spyware’) by Canadian research group, The Citizen Lab, describes a case study in which a phone used by an exiled Egyptian politician, Ayman Nour, was infected with two separate pieces of spyware, operated by government clients of two separate surveillance companies cited in the Meta report. 

House Republicans Probe Raimondo’s Financial Ties to China House Republicans are asking for a briefing from Secretary of Commerce Gina Raimondo on her family’s financial ties to China after a Washington Free Beacon report on her husband’s work for a tech company funded by the Chinese Communist Party. In a letter (December 17, 2021) Republican members said they had “significant concerns” about Chinese investment in PathAI, an artificial intelligence company that employs Raimondo’s husband in a senior role. The company is funded by Danhua Capital, a Beijing-backed firm that invests in tech companies as part of the Chinese government’s attempted “penetration of Silicon Valley”. “As the secretary of commerce, an agency central to America’s competition with China, particularly when it comes to artificial intelligence, this revelation is deeply concerning and raises significant questions about obvious conflicts of interest and our strategic interests to lead on AI,” the letter from Reps. Cathy McMorris Rodgers (R., Wash.), Morgan Griffith (R., Va.), and Gus Bilirakis (R., Fla.) states. The members ask Raimondo in the letter to answer several questions on PathAI, including whether she was aware of Chinese investment in PathAI and if she disclosed that knowledge to the Biden administration during the confirmation process. They additionally call on Raimondo to lay out whether her financial interest in PathAI has played a role in decisions regarding China, including how her agency has pushed back on efforts by others in the agency to block Chinese tech companies from partnering with American companies. The Commerce Department has argued that taking a tough-on-China approach would hurt U.S. companies, according to the Wall Street Journal. “Notably, and of particular concern given the revelation of your husband’s employer’s apparent ties to the Chinese Communist Party, the Commerce Department has reportedly been stalling efforts to blacklist certain Chinese technology companies and investments,” the letter states. Raimondo’s ethics agreement to serve in the Biden administration bars her from participating in any matter that could have a “direct and predictable effect on the financial interests of PathAI.” Raimondo’s financial disclosure forms show she would greatly benefit from the company’s success. In addition to an annual salary, Moffit (according to PathAI’s website, Andy Moffit is the Chief People Officer at PathAI, where he’s responsible for all people operations (talent acquisition, leadership development, professional development and performance management), employee experience, diversity, equity and inclusion and culture) was given a significant number of ownership shares in the company as well as stock options. The value of the nearly 200,000 shares is not ascertainable, according to the disclosure form.
According to the Washington Free Beacon Raimondo is not the only Biden administration official with family ties to the Chinese Communist Party, which complicates a planned diplomatic boycott of the upcoming Winter Olympics hosted by China. Republican senators recently called for climate czar John Kerry to resign or be fired by Biden after the Washington Free Beacon reported that Kerry and his wealthy heiress wife have at least a $1 million stake in a Chinese firm that funds China’s artificial intelligence sector—including a company blacklisted in America because it aids China in its human rights abuses against the Uyghurs. Please note, the MBFC (Media Bias/Fact Check) rates the Washington Free Beacon Right Biased based on story selection that favors the right and Mixed for factual reporting due to misleading and false claims.

What Is Cyber Command’s Role in Combating Ransomware? The recent spate of ransomware attacks in the United States, including against critical infrastructure in the case of the Colonial Pipeline attack, raises questions about U.S. Cyber Command’s role in responding to this type of malicious behavior. The crux of the issue is how to define an appropriate mission—if any at all—for employing military authorities, capabilities and resources against ransomware gangs, which are typically criminal organizations rather than nation-state adversaries. It’s an issue that will only take on increased relevance, and one for which many key questions remain unanswered. Commentators and experts have offered different perspectives on this issue. For instance, the Institute for Security and Technology’s recently published Ransomware Task Force report, which has helped to inform the Biden administration’s approach to ransomware, has little to say about the military. The report mentions Cyber Command only once, in the context of listing the stakeholders that would be part of a Joint Ransomware Task Force, and it only briefly refers to the potential for military responses to ransomware. But other experts have weighed in more comprehensively. Jason Healey, for example, recently warned against giving the military far-reaching powers to address cybercrime, concerned about the potentially damaging effects of military involvement in cybercrime prevention on civil-military relations. Other authors came down on the other side; Peter Pascucci and Kurt Sanger argued that Healey’s approach would tie the president’s hands, noting that it’s often difficult for federal law enforcement to take immediate action to counter transnational cybercrime. Both of these perspectives offer important insights as the U.S. navigates the complexities associated with the convergence of criminal and national security behavior in cyberspace. And despite disagreeing on core issues, the two sides generally concur that there is some potential role for the military in this space.
But it’s not easy to demarcate where that role might lie. A central challenge is that the definition of roles, responsibilities, and—importantly—allocation of resources and capabilities across the federal government does not perfectly map onto threat actor behavior and motivation. Ransomware is most commonly associated with criminal organizations operating for profit—an area where law enforcement has a clear prerogative and role (one exception is cybercrime that directly impacts the military or defense industrial base). But, as Jenny Jun argues, states will likely begin to leverage ransomware for strategic purposes, given the potential coercive power of this capability—an area where the military traditionally takes the lead. And ransomware increasingly falls into the nebulous nexus where criminal and national security behavior overlap. This was the case with the Colonial Pipeline attack, which was perpetrated by Russian criminals but had the potential for national security effects given the targeting of critical infrastructure.

A sign is seen as Exxon station is out of gas after a cyberattack crippled the biggest fuel pipeline in the country, run by Colonial Pipeline, in Washington, U.S., May 15, 2021. REUTERS/Yuri Gripas/File Photo

In the intersection of cybercrime and national security, criminal organizations that have ambiguous relationships with governments carry out ransomware for a mix of financial gain and strategic motivations at varying levels of control and direction by the government. For example, the Biden administration’s recent statement attributing a range of malicious cyber activities to China specifically called out proxy actors linked to China’s Ministry of State Security who moonlight in cybercrime for personal profit. It is precisely in this intersection of crime and national security that the role of military cyber capabilities is most uncertain and vague.
Therefore, a compelling case is to be made for employing Cyber Command to disrupt ransomware operations for activities that have significant national security consequences or are linked to broader strategic campaigns carried out by nation-state adversaries but that emanate from outside of U.S. borders. Moreover, it is apparent that Cyber Command currently has authority to engage cybercriminals in some circumstances, seemingly beyond “hunt forward” and partnering operations. This was demonstrated by its reported fall 2020 campaign against the Trickbot botnet run by Russian criminals. Moreover, in June 2021, Deputy Assistant Secretary of Defense for Cyber Policy Mieke Eoyang testified in front of the Senate Armed Services Subcommittee on Cybersecurity, affirming the military’s role in countering ransomware attacks. That said, critical questions remain unanswered. Below, we outline core considerations policymakers should take into account. More in this Lawfare article, authored by an Assistant Professor in the Army Cyber Institute (she is also a Research Scholar in the Saltzman Institute of War and Peace Studies at Columbia University) together with the Executive Director of the Cyber Project at Harvard Kennedy School’s Belfer Center.

U.S. Diplomatic Representation at the Beijing Winter Olympics On December 6, 2021, the U.S. Government announced it would not send an official or diplomatic delegation to the Olympic and Paralympic Winter Games in Beijing due to human rights concerns. Unlike an Olympic boycott, this action does not prevent U.S. athletes, government support staff, or private-sector sponsors from traveling to Beijing or participating in the event. The decision will only apply to officials who would have represented the U.S. Government in a diplomatic or official capacity at the Games, most notably at the Opening and Closing Ceremonies. In the recent past, this representation included delegations headed by First Lady Dr. Jill Biden at the Olympic Summer Games in Japan in 2021 and Vice President Mike Pence at the Olympic Winter Games in South Korea in 2018. The decision allows the U.S. Government to signify the importance of the issue at hand without penalizing athletes or private-sector sponsors. The White House announcement notably excepted U.S. diplomatic personnel who will provide security and consular services to U.S. athletes.

Mounting concern over environmental cost of fake snow for Olympics. Pictured: the Yanqing mountains: there is no snow on the mountains where much of the 2022 Beijing Winter Olympics will take place. The IOC awarded Beijing the right to host the 2022 Winter Olympics and will become the first city to host both the summer and winter editions of the Games. Despite a reliance on fake snow, the Chinese city beat the only other candidate Almaty, Kazakhstan 44-40 in a ballot among IOC members in Kuala Lumpur, Malaysia. Picture taken from the 137-page evaluation of the two bids.

The decision to forgo sending a diplomatic delegation comes at a time when international attention has focused on human rights abuses in Xinjiang province, a commitment bolstered by recent U.S. sanctions against PRC officials. In August, the State Department issued an advisory to the U.S.  private sector against engaging in business with foreign entities participating in genocide in Xinjiang. Most recently, the U.S. House of Representatives near unanimously passed legislation to ban imports from China’s Xinjiang region over forced labor concerns. Several like-minded partners have joined the U.S. in deciding against sending official delegations to the Games. Australia, Canada, Kosovo, Lithuania, and the UK have all expressed concerns over PRC human rights violations.
The PRC responded swiftly to news of the decision. Arguing that it was not in the spirit of the Olympics, PRC officials stated that the U.S. would “pay a price” for disrupting the Games. There has been no information on any potential response; and state-sponsored media have downplayed the decision as a political move with no bearing on the event. The decision applies strictly to the U.S. Government and does not speak to the decisions of other countries, civil society, or the private sector, each of which will make their own decisions on the matter. It only declines to send an official U.S. delegation to the Games. Like athletes and government support staff, U.S. private-sector sponsors are still able to support the event, including use of the event in advertising. At this time, there is no indication that the decision will affect routine travel to China. Sponsors and other Olympic accredited stakeholders traveling to Beijing and entering the closed loop management system have already been credentialed by the Beijing Organizing Committee for the Olympic Games (BOCOG), which should allow them to enter the country. However, the PRC could potentially retaliate against organizations that speak out on human rights issues.  

This huge Chinese company is selling video surveillance systems to Iran Chinese company Tiandy is selling its surveillance technology to Iran’s Revolutionary Guard, police, and military, according to a surveillance research group. Tiandy is one of the world’s largest video surveillance companies, selling cameras and AI-enabled software, including facial recognition technology that it claims can detect someone’s race. Tiandy has signed a five-year contract in Iran, where it plans to have eight local staff members. While the exact package of surveillance capabilities Tiandy will sell to Iran is unclear, IPVM found Tiandy cameras in use by the Iranian firm Sairan—a “state-owned military electronics provider”—and at an undisclosed military base. Crucially, the report revealed that Tiandy’s networked video recorders are in use by the Iranian military and powered by chips produced by US manufacturer Intel, raising questions of whether the Intel has violated US sanctions on Iran. (Intel says it’s investigating.) The new report (“Tiandy’s Iran Business, Sells to Revolutionary Guard And Military”) is among the few pieces of hard evidence for something experts have long suspected: that Iran is trying to build a system of digital control over its citizens, following China’s model and using Chinese tools. Read MIT Technology Review’s full story here.

Source: IPVM

Borrowing mouths to speak on Xinjiang In a new report by ASPI’s International Cyber Policy Centre ‘Borrowing mouths to speak on Xinjiang’ the authors explore how the Chinese Communist Party (CCP) uses foreign social media influencers to shape and push messages domestically and internationally about Xinjiang that are aligned with its own preferred narratives. The report examines key instances in which Chinese state entities have supported influencers in the creation of social media content in Xinjiang or amplified influencer content that supports pro-CCP narratives. That content broadly seeks to debunk western media reporting and academic research, refute statements by foreign governments and counter allegations of widespread human rights abuses in Xinjiang.The authors argue that the addition of online foreign social media influencers into orchestrated tours that have traditionally been made up of party-state media, amenable diplomats, and friendly foreign journalists reflects a willingness among Chinese officials to innovate its external communication strategy. ‘Likewise, the amplification of influencer content about Xinjiang on social media by party-state media and diplomatic accounts is used as part of campaigns to distract from and confuse allegations of human rights abuses in Xinjiang, while reframing the discussion of issues around which the CCP is particularly sensitive’ the authors write.ASPI analysed hundreds of YouTube videos depicting trips to Xinjiang made by foreign influencers. Just as many tours of Xinjiang are largely directed by party-controlled institutions and government bodies, our research suggests that some of the locations shown in the foreign influencer videos are also chosen by state entities. When the locations were not chosen by the Chinese state, our analysis found that detention centres were sometimes accidentally filmed. Our analysis of one video, filmed by a vlogger from Singapore, found that he filmed seven separate detention facilities in a 15-minute YouTube video showing his aerial descent into Urumqi International Airport.The research also examines how the CCP’s use of foreign influencers presents a new challenge to global social media platforms, and in particular their efforts to identify and label state-affiliated accounts. The report offers several key takeaways, including:

  • The use of foreign influencers creates a degree of plausible deniability for the CCP’s international facing propaganda—a strategy adopted in the knowledge that foreign voices are more likely than official CCP spokespeople to penetrate and relate to target overseas populations.
  • This activity is happening at the same time as the ability of foreign governments to conduct legitimate online public diplomacy within China—such as posting on Weibo—is being curtailed and at times censored. In combination, this creates a potent one-way vehicle for the extraterritorial projection of the CCP’s political power.
  • The type of manipulation of the information environment described in this report can be harder to detect and can circumvent efforts by social media companies to identify and categorise the online activity of government and government-funded entities.
  • Social media platforms should better craft and implement policies to identify accounts with state links, or content that has been directly facilitated by states, and these policies should apply globally.

Documents link Huawei to China’s surveillance programs Documents from Huawei Technologies suggest that the Chinese tech giant played a broader role in tracking China’s populace than the company previously acknowledged. A review by the Washington Post of more than 100 Huawei PowerPoint slides, many marked “confidential” though they were at one point posted to a public-facing website, “show Huawei pitching how its technologies can help government authorities identify individuals by voice, monitor political individuals of interest, manage ideological reeducation and labor schedules for prisoners, and help retailers track shoppers using facial recognition. ‘Huawei has no knowledge of the projects mentioned in the Washington Post report,’ the company said in a statement’.

DEA Enforcement Action Reveals Criminal Drug Networks Are Harnessing Social Media and Smartphone Applications to Flood the United States with Deadly Fentanyl, which is Driving the National Overdose Epidemic As U.S. overdose deaths reach a devastating new height, claiming a new victim every five minutes, the Drug Enforcement Administration has revealed a direct link between fentanyl-related overdose deaths and criminal drug networks in Mexico. These groups are harnessing social media platforms to bring drugs laced with fentanyl and fake prescription pills into American homes with one click on a smartphone. In a Washington, D.C., press conference, DEA Administrator Anne Milgram announced the results of a public safety surge that lasted from September 29, 2021, through December 14, 2021. The surge targeted criminal drug networks that are harnessing the anonymity and accessibility of social media apps to push deadly drugs into American communities.
DEA officials warn that criminal drug networks in Mexico are mass-producing deadly fentanyl and fentanyl-laced, fake prescription pills, using chemicals sourced largely from China.
These fake prescription pills are designed to appear nearly identical to legitimate prescriptions—such as Oxycontin®, Percocet®, Vicodin®, Adderall®, Xanax®, and other medicines—and have been found in every state in the country. In September, the DEA issued its first Public Safety Alert in six years to warn the public about the alarming increase in the availability and lethality of fake prescription pills in the United States. These fake prescription pills often contain deadly doses of fentanyl. DEA has determined that four out of ten DEA-tested fentanyl-laced, fake prescription pills contain at least two milligrams of fentanyl—an amount that is considered to be a lethal dose. Today’s announced public safety surge demonstrates that the United States is facing unprecedented levels of fentanyl in our communities. This year alone, DEA has seized enough fentanyl to provide a lethal dose to every American. Much of this fentanyl is in the form of fake prescription pills. In 2021, DEA has seized a staggering 20.4 million fake prescription pills. During the recent public safety surge, DEA and law enforcement partners seized more than 1,500 pounds of fentanyl and over eight million fake prescription pills. The seizures were directly linked to at least 46 overdoses and 39 overdose deaths. At least 76 of the cases involved drug traffickers using social media applications, including Snapchat, Facebook, Facebook Messenger, Instagram, TikTok, and YouTube. 32 cases have direct ties to the major Mexican drug networks that are mass-producing and distributing fentanyl. The December 16, 2021, Press Release from the DEA is here.

China’s Military Rise and the Implications for European Security It is increasingly difficult to have a dispassionate understanding of Chinese military power. For many, China is already an ideologically incompatible and unstoppable juggernaut; for others, it is unlikely to ever entirely match Western military capabilities. Also, China’s ability to project power within the South China Sea, East China Sea, and Taiwan Strait has been the focus of most analyses. As a result, we lack a comprehensive assessment of the overall development of China’s military capabilities and what these will mean outside of the Western Pacific, especially for European states. By developing a typology based on historical examples of other rising powers, this report moves beyond the hype and the tendency to reflexively view China as either intrinsically benign or nefarious. This process yields a two-part framework, delineating motivations and manifestations, for assessing the extent of China’s rise. This includes the current state of China’s military power, an analysis of how it arrived at current capabilities, and the trajectory through 2035. The ultimate objective of this approach is the development of an evidence- based foundation for thinking about the potential consequences of China’s military rise and European and Dutch policy options to address it. The main finding of this HCSS report is that China exhibits almost all of the factors that characteristically drive great power expansion outside of the region. It is following a typical rising great power trajectory in almost all respects, although it is still on an upward path, and is implementing a long-term strategy to be able to project power extra-regionally, which it is expected to be increasingly able to between now and 2035. The Hague Centre for Security Studies (HCSS) was established in 2007 as an independent think tank.

Strategy and Pitfalls of EU Economic Sanctions The pandemic has motivated states to move away from liberal trade policy and engage in advanced contracts or introduce legislation that prioritizes the domestic market. It also made companies realise that they do not have a full grasp of their production chain – leaving many in sudden supply shortages, when a seemingly irrelevant market introduced a lockdown affecting the industrial output. The recent acceleration in political involvement in economic practices and rising awareness of long value chains is, however, part of a broader trend – only inflated by the pandemic and populism.
In this short op-ed for HCSS, the author, a post-doctoral researcher at the University of Warsaw, analyzes the Strategy and Pitfalls of the EU Economic Sanctions, ahead of the debate on the EU Anti-Coercion Instrument.

Investigation finds World Bank leaders pushed staffers to boost rankings for China and Saudi Arabia in high-profile reports The World Bank says it will stop publishing its annual Doing Business economic report after an independent investigation found bank leaders placed “undue pressure” on staffers to alter data to inflate the rankings for China and Saudi Arabia in 2018 and 2020 editions of the report, according to CNNBusiness. The bank commissioned the law firm WilmerHale to conduct the probe. Investigators found then-CEO Kristalina Georgia pressured the Doing Business team in 2017 to “change the report’s methodology” or “make specific changes” to data points to boost China’s ranking in the 2018 edition. This came after Chinese government officials repeatedly expressed concerns to her and then-World Bank President Jim Yong Kim over the country’s ranking, according to the 16-page investigation released by WilmerHale. 

The World Bank (Washington, DC) / Source: Wikipedia

At the time, Georgieva was in the middle of negotiations over a capital increase campaign in which China “was expected to play a key role,” the investigation found. Georgieva was “directly involved” in improving China’s ranking, according to the independent investigation, which said that during one meeting, the then-CEO “chastised the Bank’s then-Country Director for mismanaging the Bank’s relationship with China and failing to appreciate the importance of the Doing Business report to the country.” 
In October 2017, the investigation found that aides to Kim also directed the survey team to simulate how China’s final score might change if data from Taiwan and Hong Kong were incorporated into the country’s existing data. The WilmerHale report says that the Doing Business team leaders “believed that the concern was coming from President Kim directly.” Georgieva, who is now the managing director of the International Monetary Fund (IMF), said in a statement that she disagrees “fundamentally with the findings and interpretations of the Investigation of Data Irregularities as it relates to my role in the World Bank’s Doing Business report of 2018,” and that she has briefed the IMF’s Executive Board on this matter. Kim has not yet responded to a CNN email seeking comment. 
During a press briefing Friday, the Chinese Foreign Ministry Spokesperson Zhao Lijian said, “Ms. Georgieva has issued a statement on the IMF’s official website. I would refer you to relevant authorities for further information. We have also noted that the World Bank recently issued a statement on suspending the Doing Business report. The Chinese government attaches great importance to the efforts of Doing Business of improving the business environment, which is evident to all. We hope that the World Bank will take facts as the basis, rules as the criterion, follow the professional, objective, fair and transparent principles, to conduct a thorough investigation into relevant issues in strict accordance with the internal review procedures, so as to better safeguard the professionalism and credibility of the Doing Business report and the credibility of the World Bank itself and its member countries’ reputations.” More in this CNNBusiness article.

Containing Crisis: Strategic Concepts for Coercive Economic Statecraft on China The United States and its allies are increasingly forced to respond to coercive economic statecraft —i.e., restrictions on trade, investment, and financial transactions intended to impose economic costs on a target in pursuit of strategic objectives—employed by China.  At the same time, the United States lacks a broader strategy for the effective use of economic tools to manage and respond to scenarios of geopolitical tension. A new CNAS report sets a new strategic framework for U.S. coercive economic statecraft toward Beijing. To gain new insights into U.S.-China economic escalation dynamics, CNAS conducted two unique tabletop exercises. The first scenario presented a crisis involving significant aggression from China against Taiwan, while the second presented a crisis surrounding a potential Chinese acquisition of dual-use technology from a fictitious European company.  Insights from the scenario exercises include:

  1. China may be willing to deploy the widest range of coercive economic tools in response to a geopolitical conflict.
  2. While both China and the United States may be willing to accept negative economic impacts to pursue geopolitical objectives, both also demonstrate a preference to broadly retain access to the other’s market, which may constrain the use of the most extreme forms of economic coercion.
  3. Countries other than the United States may be more reticent to take coercive economic actions against China due to fears of possible negative economic and political consequences.
  4. The United States may be advantaged by its alliances.
  5. Persuasive rather than coercive tactics may best improve the United States’ negotiating position when it seeks to use economic statecraft to manage geopolitical tensions

Based on these insights, the authors propose a new framework of using coercive economic measures based on the strategies of joint pressure and bound engagement. United States use the strategy of joint pressure — coordinating its responses with partner countries — to maximize pressure on China, strengthen the ability of the United States to impose costs, and minimize China’s ability to retaliate. The authors also recommend a strategy of bound engagement, by which it engages in economic escalation in a manner bound by constraints embodied in domestic and international rules and norms.

Intelligence Almanac: 2020 Index Report / ИСКУССТВЕННЫЙ ИНТЕЛЛЕКТ АЛЬМАНАХ Индекс 2020 года This translated report by a Russian AI think tank (the National Technology Initiative -NTI- Competence Center for Artificial Intelligence at the Moscow Institute of Physics and Technology -MIPT-), provides an overview of Russia’s AI landscape as of the end of 2020. The authors argue that the Russian AI industry is lagging relative to other countries, and recommend a three- to five-fold increase in Russian AI research funding. The Russian source text is available online.

An unprecedented RSF investigation: The Great Leap Backwards of Journalism in China Two years after China’s Pursuit of a New World Media Order, Reporters Without Borders (RSF) publishes The Great Leap Backwards of Journalism in China, a report revealing the extent of the regime’s campaign of repression against the right to information. Published a year before the Chinese Communist Party’s 20th National Congress, which will take place at the end of December 2022, The Great Leap Backwards of Journalism in China is a damning 82-page document that demonstrates the acceleration of China’s violations against its own international commitments to freedom of opinion and expression. The report, released on 7 December 2021, reveals the unprecedented campaign of repression led by the Chinese regime in recent years against journalism and the right to information worldwide. Specifically, the report examines the regime’s tools of repression against journalists and the deterioration of press freedom in Hong Kong, which was once a model of press freedom but now has an increasing number of journalists arrested in the name of national security. Allegiance to Xi Jinping now a requirement for China’s journalists. The report noted that Chinese journalists are required to complete a minimum of 90 hours of training every year on “Xi Jinping Thought” and that at least 127 Chinese and foreign reporters are currently detained by the authorities. The report details Beijing’s strategy to control access to information within and beyond its borders before presenting appeals and recommendations to Chinese authorities, governments, institutions, journalists and media outlets. In a previous report, published in 2019 and entitled China’s Pursuit of a New World Media Order, RSF demonstrated how Beijing tries to put an end to the role of journalism and instead make it a tool at the service of state propaganda. The People’s Republic of China ranks 177th out of 180 in the 2021 RSF World Press Freedom Index, only two spots above North Korea. The special administrative region of Hong Kong, once a bastion of press freedom, has slipped from 18th place, upon the index’s creation in 2002, to 80th place in 2021.

Huawei, 5G and Security: Technological Limitations and Political Responses How did Chinese 5G providers, such as Huawei, become a security concern in the USA and Europe? Were the security concerns related to 5G and Chinese suppliers based upon technological features of the systems, or were they a product of geopolitical rivalry? How did European approaches to 5G distinguish themselves from those of the USA? This NUPI article, the authors address these questions using an interdisciplinary approach via the framework of securitization theory. The authors argue that the technological features of 5G made securitization more likely compared to 4G, and that screening and control of software was unlikely to defuse securitization concerns. They also show how Europe chose its own path for the securitization of 5G. In short, the October 2021 academic article argues that the American macrosecuritization of China largely failed in Europe, whereas the niche securitization of 5G was more successful. The Norwegian Institute of International Affairs [NUPI] is a leading centre for research on international issues in areas of particular relevance to Norwegian foreign policy.

Taiwan Government Shutters China Center at Premier University Taiwan’s Ministry of Education has ordered National Tsing Hua University (NTHU) to close its Cross-Strait Tsinghua Research Institute (清華海峽研究院) immediately and send its mainland Chinese staff home. The institute was founded in Xiamen, Fujian in 2015 by NTHU, Tsinghua University in Beijing, and the Xiamen City Government to attract Taiwanese talent to China. Then-NTHU vice president Wu Cheng-wen attended the institute’s establishment ceremony in 2016, and in 2019 NTHU president Hocheng Hong and former NTHU president Chen Lih-juann met with representatives of China’s Tsinghua University. Democratic Progressive Party Legislator Fan Yun said that NTHU officials lied about their involvement in cross-strait exchange programs that took student groups to China to meet with officials from Beijing’s Taiwan Affairs Office. 

Taipei / Source: The Skyscraper Center

Speech by SIS Chief Richard Moore: Human Intelligence in the Digital Age Richard Moore, Chief of the UK Secret Intelligence Service (MI6), has made his first public speech since taking up his role in October 2020. He talked about the seismic changes he sees in the world, specifically in the espionage environment. He discussed China, Russia and Iran, three of the “Big Four” priorities for the intelligence world. He also explained what the UK is doing to address the fourth priority – the amorphous, shape-shifting character of international terrorism. As part of wider government strategy outlined in the Integrated Review, MI6 is adapting to meet the new threats and challenges that the accelerating pace of technological change now poses. With the shifts in the security landscape and revolutionary advances in technology, the business of espionage has become considerably more challenging. MI6 has traditionally relied primarily on its own capabilities to develop world class technologies. But, as Richard Moore tells the International Institute for Strategic Studies, mastering human intelligence in the digital age is a national security imperative, and it cannot be done alone. That includes being more open and partnering with the private sector to find new technologies to allow continued mastery of human intelligence in the digital age. Critically, the workforce of MI6 needs to be as diverse as the population it serves. Richard Moore says in his speech this means the organisation must be more open and able to continue to attract the very best of British talent. See the speech, and read the speech transcript here

Exclusive: Meet ‘Director K’, the MI5 spy responsible for keeping Britain safe from China and Russia Security service’s head of hostile states counterintelligence reveals true scale of the threat facing the nation in unprecedented interview with The Telegraph. MI5’s head of hostile states counterintelligence has called for an overhaul of te Official Secrets Act complaining it is a “staggering” 100 years out of date. In an exclusive interview the senior intelligence officer said current laws were suitable “if we catch somebody with a hand-drawn map intending to send it to an enemy”, but not to combat the most diverse series of threats ever faced by the UK. The officer – who can be identified in public only by her title, Director K – said new laws were needed to “disrupt what is increasingly damaging activity” waged against the UK by hostile states, including Russia and China. She said that just two people had been successfully prosecuted under the Act in the past decade, proof that it needed urgent changes.
Director K told The Telegraph that Britain was under threat from “malign interference” that ranged from the theft of valuable intellectual property, such as the Oxford Covid vaccine, to “crass assassination plots” – a reference to Vladimir Putin’s attempt to kill a Russian double agent using Novichok nerve agent in Salisbury. In the interview – the first ever given by an MI5 officer at her level of seniority – Director K urged the British public to play its part in combating the threat, by making sure computer systems were secure from cyber attack and that vital UK companies do not sell stakes to foreign powers. She added: “We need academia and industry to understand what the threats are and not to be naive about them.” The Official Secrets Act, which dates back to 1911, was introduced in response to the threat from international espionage. It was replaced in 1989, although parts of the original act remain in force.  Following consultation, the Home Office is considering updating the law, although campaigners have warned it will punish whistleblowers and investigative journalists. But Director K said: “We need new legislation. We are in a position now where we are relying on powers that are over 100 years old.” She said MI5 had “been laying out the threat”, but it was now for Parliament to “decide what the right balance is” to ensure Britain retained its “openness” while giving the intelligence services “the tools we need to stop our adversaries from exploiting our openness against us”. Director K went on: “There will be some specific measures in there that will allow us to create modern legislation that we need to deal with the range of threats we have been describing. “Some of them are really basic, so that at the moment it is not illegal to be a foreign spy in the UK. Which is staggering. “If we catch somebody with a hand-drawn map intending to send it to an enemy, which we don’t really define, then we have the legislation. We have only used it twice [successfully] in the last 10 years because of that.” New laws, she said, would mean MI5 “not having to find really creative ways every time to disrupt what is increasingly damaging activity”. In the interview, Director K said that espionage was no longer the “stuff as being spy on spy, old school movies and novels territory”, but “impacts every area of society, potentially every individual in the UK”.
Russia posed an “acute” threat to the UK but China was “chronic”, she said, likening Putin’s Russia to an “unpredictable storm” while China’s threat was long term, akin to the risk of climate change. She issued a warning to strategic companies not to sell out to Chinese firms, adding: “It could look very attractive to a small, pioneering start-up to be attractive to Chinese investment but we are seeing all too often that IP [intellectual property] being stolen and the benefits do not accrue to the company, and ultimately to our society, our economy.” The lengthy, full interview, published on the 3rd of December, 2021, is here

Thames House, the headquarters of MI5. Photo: Buildington

Additional information: 

MI5 / In April 1914, the Secret Service Bureau is absorbed into the War Office for the duration of the war. It becomes part of section 5 of the Directorate of Military Operations and is given the name MO5(g). In September 1916 MO5(g) is moved across to the newly established Directorate of Military Intelligence within the War Office. It becomes section 5 of the Directorate of Military Intelligence – hence MI5. In 1929 MI5 is renamed as the Defence Security Service, and in 1931 the Defence Security Service becomes the Security Service, the name by which it is still known today. However, “MI5” is still widely used as a short alternative to their official name.
MI6 / From 1909 and through the war the Service had a variety of names including the ‘Foreign Intelligence Service’, the ‘Secret Service’, ‘MI1(c)’, the ‘Special Intelligence Service’ and even ‘C’s organisation’. But, around 1920, the title the Secret Intelligence Service (SIS) was adopted. This is the official title the Service has continued to use ever since. The origins of the use of ‘MI6’ are to be found at the start of the Second World War when this abbreviation was adopted as a flag of convenience for SIS. It was used extensively throughout the war, especially if an organisational link needed to be made with MI5 (the Security Service). Although ‘MI6’ officially fell into disuse years ago, many writers and journalists continue to use it to describe SIS.

Supply Chain Weaknesses Are a Threat to National Security Those of us in the United States are learning how closely national security relies on supply chains that run through Asia––China in particular—as the pandemic continues to expose weaknesses in global supply lines. Factory shutdowns and shipping disruptions far away and at home can seriously impact important American industries like the defense, technology, energy, transportation, public health, and biological sectors. A panel of congresspeople and business executives recently gathered at the 2021 Aspen Security Forum to explore the global supply chain and its recent issues. The conversation led to several key insights about the global supply chain challenge as panelists discussed why supply chain disruptions can have longer-term national security implications. They also debated whether the United States could build a more resilient supply chain by onshoring key industries and revising its export-control policy framework to improve funding streams and American market competitiveness. Watch the full recording of “Building a More Resilient Global Supply Chain” here

Microchips: Small and Demanded The interplay of a pandemic, extreme weather events and geopolitical power dynamics have exposed the fragile networks underpinning the semiconductor industry. Because microchips are almost indispensable in daily life, the current shortage situation raises questions about supply chain security. The December 2021 article, written by a researcher in the Swiss and Euro-Atlantic Security Team at the Center for Security Studies (CSS) at ETH Zürich, is number 295 in the series “CSS Analyses in Security Policy”. The Center for Security Studies at ETH Zurich is a center of competence for Swiss and international security policy. It offers security policy expertise in research, teaching and consultancy.

The Diminishing Path to Growth: Can Xi Jinping Avoid Crisis during China’s Economic Transition The hopes that China’s integration into the global market would transform it into a responsible stakeholder have foundered on the reality of China’s increasingly mercantilist economic policies; its aggressive expansion of political power; the resurgent dominance of state-owned enterprises; and an economy driven by debt and real estate. These practices could be leading China down a path to financial catastrophe, a Hudson Senior Fellow argues in a new policy memo

Key Takeaways:

Xi Jinping’s Politically-Driven Economic Model / Xi Jinping’s vision of reinventing and imposing a state-directed, CCP-dominated model [could be observed at] China’s March 2021 Party Congress, where he outlined plans to double per capita income in China by 2035. His overall strategy emphasizes several elements: increasing China’s economic self-sufficiency while making the world more dependent on its economy; enhancing China’s economy and military in ways that exploit the vulnerabilities of other countries; and increasing China’s world leadership in high-technology industries while amassing leverage over global resource flows such as minerals and energy supplies. Domestically the project privileges the requirements of CCP top-down direction as well as bottom-up micromanagement, in part by requiring all state-owned banks and private enterprises to have CCP members on their management committees.
The Security Risks of China’s Economic Slowdown / Growth has immense political salience in the PRC—it justifies the authoritarian system of governance—and a significant slowdown or recession could lead to political instability. Given Chinese nationalist rhetoric and revanchist ambitions toward Taiwan, political instability could in turn motivate risky military activities that escalate into confrontations with democratic, market-oriented countries. From the perspective of the United States, a slowdown could exacerbate the already serious trade and economic tensions, especially if nationalist forces in China sought to cast the US as the scapegoat for its internal problems.
Xi’s Crackdown on Business Leaders / China’s elite circles, high-level officials, and business tycoons remain a source of opposition to Xi; the evidence is the number of individuals publicly targeted, disappeared, jailed, or worse. During the Xi tenure some 432 “tigers” or high-level officials or politicians have felt the sting of Xi’s anti-corruption campaigns or purges, as have some 4 million lower-grade cadres. [As part of Xi’s new politico-economic program,] authorities have put in place punishing new regulations for—or have banned outright—leading innovative companies Alibaba, Didi, and Tencent and the private tutoring and ridesharing businesses. Hundreds of firms have been fined more than $3 billion, apps have been purged, and a “regulatory onslaught” has been unleashed. The result of this effort is reduced innovation and risk-taking along with a climate of fear among some of China’s best-performing digital technology companies.

The Supply-Chain Mess According to a Project Syndicate article, written by Professor of Economics at MIT, recent bottlenecks and price surges have underscored the risks that come with sprawling global supply chains supposedly built around the principle of economic efficiency. But beyond these glaring issues, supply chains impose additional social costs that warrant policymakers’ attention. Global supply chains used to be the last thing policymakers worried about. The topic was largely the concern of academics, who studied the possible efficiency gains and potential risks associated with this aspect of globalization. Although Japan’s Fukushima nuclear disaster in 2011 had demonstrated how supply-chain disruptions could impact the global economy, few anticipated how central the problem could become.

A New Chinese National Security Bureaucracy Emerges An intriguing aspect of General Secretary Xi Jinping’s political consolidation was the establishment of a Central National Security Commission (CNSC; 中央国家安全委员会Zhongyang guojia anquan weiyuanhui) at the end of 2013. The CNSC seemingly empowered Xi, who was put in charge of the new body, and through a permanent staff structure, perhaps set the stage for more effective strategic planning and crisis response. Over the last few years, subordinate National Security Commissions (NSCs) have been installed at all tiers of the party structure down to the county level. The CNSC thus sits atop a new organizational hierarchy that strengthens Xi’s ability to set the agenda and improves the party’s ability to coordinate national security affairs. While the system’s political utility for Xi is clear, its role in improving crisis response at the local level could be constrained by several factors. A Proliferation of NSCs. Xi’s invocation of “party committees at all levels” raised the question of how lower tiers of the party hierarchy would fit into the “national security system.” Answers came in early 2019 when subordinate NSCs began to appear throughout the party structure—provinces, prefectures, municipalities, city districts, and counties now all have NSCs within their party committees, forming a vertical system culminating in the CNSC. You can read the full article in Jamestown’s China Brief, Volume: 21 Issue: 23, here.

China and Africa’s digital infrastructure Trucks, trains, and planes have long shaped African markets, but the new infrastructure connecting the continent is digital. By 2025, some 65 percent of Africa’s expected 614 million mobile connections will be smartphones—and it’s time for the United States to take notice. That’s because China is already tapping into those networks by investing in telecom infrastructure and media assets, among other commercial ventures. Today, the real great-power competition is in the digital realm rather than the physical—and the emerging field offers Washington a major strategic opportunity. There’s more in Atlantic Council’s article “Africa’s digital infrastructure is the next playing field for great-power competition”

Why are eastern European countries cosying up to Taiwan? When Taiwan opened a “representative office” in Vilnius, Lithuania’s capital, on November 18th, one of its first guests was an elder statesman who was born when the island was still under Japanese imperial rule. Vytautas Landsbergis knows about throwing off the shackles of foreign oppression: in 1990, as one of the founders of Lithuania’s independence movement, he led the country’s breakaway from the Soviet Union. Mr Landsbergis’s grandson, Gabrielius Landsbergis, is now Lithuania’s foreign minister. The new office is the first that Taiwanese diplomats have opened in Europe in 18 years. It is, in effect, an embassy, like Taiwan’s other 28 offices in Europe. Unlike the others, however, it is allowed by its host country to use the name of Taiwan instead of Taipei, which is the name of the island’s capital. As China sees it, this smacks of recognition by Lithuania that Taiwan is a separate country. Itabhors any such notion. After Lithuania announced that it would host the representative office using the name Taiwan, China stopped approving export permits for Lithuanian producers (although existing permits have not been cancelled), and downgraded its diplomatic relations with the country, recalling its ambassador from Vilnius and ordering Lithuania’s to leave Beijing.
Other central and eastern European countries are cosying up to Taiwan too. In addition to Lithuania, the Czech Republic, Poland and Slovakia donated covid-19 vaccines to the island—the only EU countries to do so. One Taiwanese NGO coined the term #DumplingAlliance to celebrate the countries’ shared values and love of meat-filled dough (the billions eaten in China each year notwithstanding). On December 2nd representatives from Estonia, Latvia and Lithuania (among other countries) gathered in Taipei for the Open Parliament Forum, a summit designed to strengthen the island’s relationships with the democratic world. Why are these countries so keen to build links with Taiwan?
History is one reason. The governments in many eastern European countries can trace their roots back to the anti-Soviet movements of the late 1980s and 1990s. Estonia, Latvia, Lithuania and Slovakia are all led by centrist or centre-right coalitions that are increasingly hawkish on China. Many see similarities between the Soviet Union, which once controlled them, and today’s oppressive China. But their concerns are not just historic. In the Czech Republic, for example, public opinion began to sour towards China in 2017 when it was accused by journalists and politicians of trying to interfere in Czech politics by dangling the promise of massive investments. In 2018 the Czech intelligence service said Chinese espionage was a greater threat to the country’s security than Russian interference. Countries that border Belarus, such as Latvia and Lithuania, worry about China’s keenness to collaborate with Belarusian armed forces. The article in The Economist can be found here.

New CNAS Report Urges Policymakers to Start Preparing for 6G Technology Now The next generation of wireless telecommunications technologies, 6G, promises to supercharge data transmissions—projected to be up to 100 times faster than the peak speed of 5G. With deployments of this new technology expected within the next decade, a new CNAS report argues that the United States and other tech-leading democracies must heed lessons from the tenuous 5G experience and begin preparing for what comes next in the growing strategic competition with China. The authors discuss the lessons learned from Washington’s incoherent approach to 5G, the future of 6G technology and its implications—and why the United States must craft a robust 6G strategy sooner than later.   

The report recommends actions the administration and Congress should take to secure future networks and promote American competitiveness in 6G, including:

  • Crafting a 6G strategy. The United States needs a strategic road map that lays out a vision for American leadership in 6G and the desired international and domestic telecommunications landscape of 2030 and beyond.
  • Establishing a U.S. 6G Spectrum Working Group. This group should include representatives from government entities including the Office of Science and Technology Policy, Federal Communications Commission, National Institute of Standards and Technology, and the Department of Defense, among others, along with stakeholders from private industry.
  • Designating the Department of Commerce as a U.S. intelligence community (IC) member. The Department of Commerce is a critical player in technology competition for both promoting and protecting innovation.
  • Leading the creation of a Multilateral Digital Development Bank. In partnership with export credit and export finance entities in allied countries, the United States should lead in establishing a new organization with the mission of promoting secure and fair digital infrastructure development around the world, with a special emphasis on closing the digital divide in less affluent countries.

How and by whom telecommunications infrastructure is deployed—and the resilience and security of that infrastructure—is, at its core, a matter of vital economic and national security.

Hackers are turning to this simple technique to install their malware on PCs According to a new ZDNet article, nation state-backed hacking groups are exploiting a simple but effective new technique to power phishing campaigns for spreading malware and stealing information that’s of interest to their governments. Advanced persistent threat (APT) groups are using rich text format (RTF) template injections.  While the use of RTF text file attachments in phishing emails isn’t new, the technique being used by hackers is easier to deploy and more effective because it’s harder for antivirus software to detect – and many organizations won’t block RTF files by default because they’re part of everyday business operations. The technique is RTF template injection. By altering an RTF file’s document-formatting properties, it’s possible for attackers to weaponise an RTF file to retrieve remote content from a URL controlled by the attackers, enabling them to secretly retrieve a malware payload that gets installed on the victim’s machine.
Attackers can use RTF template injections to open documents in Microsoft Word, which will use the malicious URL to retrieve the payload while also using Word to display the decoy document. This approach might require luring users into enabling editing or enabling content to begin the process of downloading the payload, but with the right form of social engineering, especially off the back of a convincing lure, a victim can be tricked into allowing this process to take place. It isn’t a complex technique, but because it is simple and reliable to use, it has become popular with several nation-state hacking operations, which can deploy RTF attacks instead of other, more complex attacks, but still get the same results. 

ABCD 2021 Highlights: Next NATO Strategic Concept, New Threats, Russia’s High Appetite for Risk, Emphasis on Collective Defence The Annual Baltic Conference on Defence (ABCD) 2021 focused on the new Strategic Concept that NATO will develop in time for its next summit in 2022.The conference discussed the influence of Russia and China on our security environment and how NATO should position itself politically and militarily in relation to these two countries, including in its deterrence and defence posture in the Baltic Sea region. It also discussed how the Alliance should develop more broadly in the next 10 years and reflected on the relationship between the US and Europe.The conference featured a long list of speakers, including Alar Karis, President of Estonia, Nikolaos Panagiotopoulos, Minister of National Defence of the Hellenic Republic, James Heappey, Minister for the Armed Forces of the United Kingdom, Margiris Abukevičius, Vice-minister of National Defence of Lithuania, Patrick Turner, NATO Assistant Secretary General for Defence Policy and Planning, Lieutenant General Sławomir Wojciechowski, Commander Multinational Corps Northeast and Guillaume Ollagnier, Head of the Department for Europe, North America and Multilateral Affairs at the Ministry for the Armed Forces of France.

Compared to 2010 NATO faces new threats. Its strengths have forced adversaries to go below the threshold of armed conflict. Adaptation and modernisation efforts must be accelerated, and the Alliance should amend its political decision-making process: the North Atlantic Council cannot afford months of deliberations and NATO should trade quantity for responsiveness. Burden sharing also means being in the South China Sea. NATO also has a potential role in ensuring sea lines of communication between the Eastern Mediterranean and the Pacific Ocean. Even though they may seem ineffective today, arms control efforts are necessary in case Russia should change its current approach.
It is a misperception that Russia is a declining power. On the contrary, Russia is not going away and has a high degree of appetite for risk. Indeed, Russia’s elite consists of imperialists who are of the opinion that it is the West that is declining. There were different views as to whether China is a challenge or a threat. Some view China not as a rising power but as a present threat that uses hybrid and cyber tools very actively. NATO’s new Strategic Concept will need to reflect the shift in the strategic landscape. Deterrence and defence will be less bound by geography because of recent developments, e.g., cyber, space and hypersonic weapons. But much of NATO’s adaptation will be threat-agnostic, e.g., the need for more resilience.
NATO’s three core tasks are likely to remain in the new strategic concept although the emphasis will be on collective defence and not on large out-of-area operations. Speakers expressed different views regarding NATO’s approach vis-à-vis China due to the fact that it is harder to define China than Russia. Discussions about duplication and competition between NATO and the EU are unhelpful since capable national armed forces are the very basis of our security.
Speakers expressed opposite views on NATO’s adaptation depending on whether their focus was on what already has been accomplished (glass half full) or on what remains to be done (glass half empty). Since 2014, the European Allies and Canada have increased their defence spending by 260 billion USD, the Alliance’s nuclear deterrence has been strengthened and a new family of defence plans has been developed. Still, NATO lacks unity of command and national developments are not always harmonized, so more resources and bigger numbers will not automatically improve the situation. The conference was organised by the International Centre for Defence and Security together with the Estonian Ministry of Defence, and in cooperation with the Konrad Adenauer Stiftung. It was supported by MBDA, EuroSpike, Nammo, BAE Systems and Milworks. The event was attended by more than 180 participants, including representatives from NATO, Allies and partners, as well as defence and security experts.

Trump did not get a CIA briefing on Jan. 6 or for the rest of his presidency After a holiday break where he didn’t receive a classified intelligence briefing, President Donald Trump was supposed to get one on Jan. 6, 2021—the day of the violent attack on the U.S. Capitol. It didn’t happen. And then he didn’t get one for the rest of his presidency—and hasn’t received one since. That unusual stretch where the sitting president didn’t receive a regular classified briefing is recounted in the latest version of a book published and regularly revised by the Central Intelligence Agency, which describes how spies update presidents on national security matters.

Organized Crime and Corruption Across Borders – Exploring the Belt and Road Initiative Book description: Published by Routledge on the 1st of April, 2021, this book explores China’s Belt and Road Initiative and the criminogenic potential for economic, financial, and socio-cultural cooperation across countries, where some are known for weak law enforcement and high levels of corruption. It examines whether these flows of capital are increasing the amount of organized crime in the newly linked regions and how law enforcement agencies are responding. Bringing together experts across the Global South and Europe, this book considers transnational organized crime and corruption across One Belt One Road (OBOR). It examines crime and corruption in China and its international United Front tactic; analyzes various forms of transnational organized crime such as trafficking of illegal drugs, looted antiquities, and wildlife and counterfeit products; and presents studies on corruption and organized crime in selected OBOR countries including Russia, Kazakhstan, Lithuania, Czech Republic, Poland, and Bangladesh. This book makes a significant contribution to the development of southern criminology and will also be of interest to those engaged with transnational organized crime, political economy, international relations, and Asian and Chinese studies.

EU launches its own Belt and Road: Global Gateway The European Commission and the High Representative for Foreign Affairs and Security Policy launched the Global Gateway, the new European Strategy to boost smart, clean and secure links in digital, energy and transport and strengthen health, education and research systems across the world on December 1, 2021. It stands for sustainable and trusted connections that work for people and the planet, to tackle the most pressing global challenges, from climate change and protecting the environment, to improving health security and boosting competitiveness and global supply chains. Global Gateway aims to mobilise up to 300 billion in investments between 2021 and 2027 to underpin a lasting global recovery, taking into account our partners needs and EU’s own interests.

President of the European Commission, Ursula von der Leyen, said: “COVID-19 has shown how interconnected the world we live in is. As part of our global recovery, we want to redesign how we connect the world to build forward better. The European model is about investing in both hard and soft infrastructure, in sustainable investments in digital, climate and energy, transport, health, education and research, as well as in an enabling environment guaranteeing a level playing field. We will support smart investments in quality infrastructure, respecting the highest social and environmental standards, in line with the EU’s democratic values and international norms and standards. The Global Gateway Strategy is a template for how Europe can build more resilient connections with the world.”

High Representative/Vice-President, Josep Borrell, said: “Connections across key sectors help to build shared communities of interest and reinforce the resilience of our supply chains. A stronger Europe in the world means a resolute engagement with our partners, firmly grounded in our core principles. With the Global Gateway Strategy we are reaffirming our vision of boosting a network of connections, which must be based on internationally accepted standards, rules and regulations in order to provide a level-playing field.”

The EU has a long track record as a trusted partner to deliver sustainable and high quality projects, taking into account the needs of our partner countries and ensure lasting benefits for local communities, as well as the strategic interests of the European Union. Global Gateway is about increasing investments promoting democratic values and high standards, good governance and transparency, equal partnerships, green and clean, secure infrastructures and that catalyse private sector investment.

Human rights violations off the rack: Dutch and US brands allegedly rely on forced labor The European Center for Constitutional Rights (ECCHR) with the support of Prakken d’Oliveira Human Rights Lawyers submitted a criminal complaint against several Dutch and US textile and fashion brands who have their European headquarters in the Netherlands. They argue that Patagonia, Nike, C&A and State of Art may have been directly or indirectly complicit in the forced labor of members of the Uyghur population in China’s Xinjiang province. They ask the Dutch Public Prosecutor to investigate the corporations’ alleged complicity in human rights violations that could amount to crimes against humanity. “The choice to not only focus on national criminal law regarding labour exploitation, but to broaden the complaint to crimes against humanity, underlines the scale of the crimes that are committed in Xinjian and aligns with statements from politicians and NGOs that have qualified the treatment of Uyghurs in Xinjiang as genocide and crimes against humanity,” says a Human Rights Lawyer at Prakken d’Oliveira. Alarming reports about torture, re-education camps, and forced labor in the Xinjiang region in China have increased in frequency since 2017. According to Amnesty International, the Chinese government systematically persecutes the Muslim Uyghur minority in Xinjiang. Tens of thousands are allegedly forced to harvest cotton and manufacture clothing – which are also sold on the European market. 
Research reports, as well as publicly available supply chain information disclosed by the investigated brands, explicitly state that the companies have suppliers with production facilities in Xinjiang. More information in this ECCHR December 2, 2021, press release. The complaint in the Netherlands is part of a series of criminal complaints in Europe against Western brands regarding their alleged involvement in Xinjiang. In September 2021, ECCHR submitted a similar complaint in Germany and in April 2021.

China’s cyber vision: How the Cyberspace Administration of China is building a new consensus on global internet governance This ASPI report provides a primer on the roots of the Cyberspace Administration of China (CAC) within China’s policy system, and sheds light on the Chinese Communist Party’s (CCP) intentions to use cyberspace as a tool for shaping discourse domestically and internationally. The report details the position of the Cyberspace Administration of China in China’s propaganda system. Considering its origins in the former Party Office of External Propaganda, the authors argue that ‘countries that lack comprehensive cyber regulations should err on the side of caution when engaging with the CCP on ideas for establishing an international cyber co-governance strategy.’ By assessing the CCP’s strategy of becoming a ‘cyber superpower’, its principle of ‘internet sovereignty’, and its concept of ‘community of common destiny for cyberspace’, this report seeks to address how the CCP is working to build a consensus on the future of who will set the rules, norms and values of the internet. The report also examines the World Internet Conference – a ‘platform through which the CCP promotes its ideas on internet sovereignty and global governance’ – and its links to the CAC.

Punishing Journalists PRC Province’s Latest Mass Surveillance Project, Won by Neusoft Powered By Huawei The system will classify individuals into three tiers of a “traffic-light” based on perceived danger, and those labeled as key concerns will be surveilled. According to an IPVM article, PRC province Henan awarded a surveillance project that specifies tracking foreign journalists, foreign students, and migrant women, as well as tracking individuals by ethnicity, including Uyghurs. On September 16, 2021, PRC publicly traded company Neusoft won the project, that specifies using Huawei cloud software. The surveillance project, which is unlike anything IPVM has previously encountered, targets journalists in a deliberate and calculated manner. Specifically, the system is designed to tag journalists for “处置” (in Chinese, this phrase is typically used in the context of dealing with or punishing individuals) based on PRC authorities’ opinion of the risk they pose to the state.  The PRC has a history of detaining and punishing journalists, but this material illustrates the first known instance of the PRC building custom security technology to streamline state suppression of the press. It is not known whether the system is currently being used. IPVM reported this story with Reuters.

Understanding the Pro-China Propaganda and Disinformation Tool Set in Xinjiang In early October, the Twitter account of a vice president at an international private bank based in Monaco tweeted several times about life in Xinjiang, China. She shared videos of the white birch forests that beautify the region and spoke of her love of Xinjiang-style fried pork noodles. The account also posted a video of the Xinjiang cotton harvest, saying, “Mechanization helps the cotton industry improve quality and efficiency, and increase farmers’ income #Xinjiang.” This banker had not recently returned from a trip to Xinjiang. She was not tweeting praise for Xinjiang culture and economy out of genuine affection or self-interest. She was not even doing the tweeting. Hackers had stolen her account some weeks before to join a chorus of other Twitter accounts discussing Xinjiang’s cuisine and cotton. This banker’s Twitter account had become the smallest cog in a vast, state-backed, defensive-disinformation campaign. In the past several years, inauthentic social media accounts attributed to China have been identified as operating as part of several disinformation campaigns. China’s trolls first made headlines when they worked to undermine Hong Kong democracy protests. Since then, actors linked to the Chinese government have expanded the use of similar accounts. The cybersecurity firm FireEye and Google’s threat analysis group have identified an ongoing Chinese information operation involving social media. They have identified elements of this campaign in various languages across 30 different social media platforms and 40 different websites and found it targeted a range of issues, including attempts to undermine the dissident Chinese billionaire Guo Wengui. More recently, researchers from Oxford University’s Programme on Democracy and Technology revealed China-linked accounts that spread an absurd story that the coronavirus originated with Maine lobster shipped to Wuhan.
The authors of this article (published by the Lawfare Institute in cooperation with Brookings), are an associate professor in the department of Communication at Clemson University and lead researcher in the Clemson University Media Forensics Hub (he studies state sponsored disinformation on social media, focusing on the work of the Russian Internet Research Agency), and  an associate professor in the John E. Walker Department of Economics and a lead researcher at the Clemson University Media Forensics Hub (he has a PhD from MIT in economics and studies media, politics, and the economics of organizations). Their research at the Clemson University Media Forensics Hub has been tracking an extensive pro-China propaganda and disinformation operation, extending the work done by FireEye, Google and Oxford. Understanding the full strategy, tactics and motivation behind current and future Chinese disinformation campaigns requires an understanding of the full Chinese tool set.

Benchmarking critical technologies – Building an evidence base for an informed critical technologies strategy Technology policy formulation has recently gained a renewed importance for governments in the era of strategic competition, but contextual understanding and expertise in deciding where to focus efforts are lacking. As a result, decision-makers might not understand their own national strengths and weaknesses. It’s difficult to judge whether a country’s R&D outputs, no matter how advanced, and its development of production capacity, no matter how significant, align with the country’s intended strategic objectives or can be used effectively to achieve them. The ability to measure the relative strengths and weaknesses of a country by weighing specific strategic objectives against technical achievements is of paramount importance for countries. This is especially true as nations seek to resolve supply-chain resilience problems underscored by the Covid-19 pandemic. China’s rejection of the Quad’s vision of a free and open Indo-Pacific, willingness to use economic coercion and the resulting strategic competition, call further attention to multiple technology sectors’ heavy reliance on a single source. A solution must be found that can exploit synergy across multiple technology sectors among collaborating countries while ensuring supply-chain resilience.
What’s the solution? Governments’ ability to ensure that strategic objectives pertaining to critical technologies are both well articulated and achievable, and researchers’ and industry’s ability to collaborate in meeting those objectives, would be greatly enabled by the development of an objective and repeatable methodology for measuring technical achievements against clearly defined strategic goals for the critical technology sector. The most pressing challenge should be a relatively straightforward one to resolve: standardize metadata about national objectives and R&D efforts to enable business analysis. The Quad Critical and Emerging Technology Working Group is an important step towards building collaboration in the research, development and production of critical technologies among like-minded governments. While in nascent stages, the group is gathering momentum and working towards addressing the September 2021 objective to monitor trends in critical and emerging technologies for cooperation, with an initial focus on biotechnology. The authors of the ASPI report look to develop an objective and repeatable methodology for measuring technical achievements against clearly defined strategic goals for the critical technology sector, and recommend as follows:

  • Conduct detailed analysis to understand current and emerging gaps in critical and emerging technologies, starting with biotechnology, among like-minded countries.

  • Develop a partnership between like-minded countries with advanced technological capabilities to deliver a secure technology supply chain for critical tech. This should include a commitment to a set of core principles for technology development and delivery, including ‘baking in’ democratic principles to the technology and agreeing to share any civilian advances on market terms and refrain from coercion.

  • Establish a Quad or Quad Plus critical technologies fund to which participating states pledge investment funds that are then disbursed to address current and emerging critical technologies gaps.

Peng Shuai and China’s mistress problem A high-flying Chinese businessman once told me his secret to happiness: ‘Before a man is 35, women are tools; after 35, women are toys.’ It worked for him. He married an educated woman from a good family who helped him climb the career ladder; but once established in his career, he began seeking more exciting female company. I’ve been thinking about that man since the story of the Chinese tennis player Peng Shuai broke. Peng detailed a three-year affair she had with the retired vice premier Zhang Gaoli, 40 years her senior. During the good times, they would ‘talk for hours, play chess, play tennis no end… our personalities fitted so well’. But when he got bored, he ‘disappeared’ and ‘tossed me aside’, she wrote on Weibo. Chinese social media was treated to an insider view of the salacious lifestyles communist officials still lead. This was no ordinary affair. Peng says it started when Zhang forced her to have sex after they played tennis — ‘that afternoon I cried and didn’t agree at first’ — but she stayed for dinner, and Zhang kept up the pressure. ‘Yes, we had sex. Emotions are complicated, hard to put into words. From that day on, I decided to open my heart [to him].’ A far cry from your average ambitious mistress, Peng seems to be someone who was abused, groomed and abandoned. She was at pains to say she didn’t take a penny from Zhang. 

The #MeToo scandal hit China’s celebrity world earlier this year with the arrest of the actor Kris Wu, a Chinese R. Kelly. Beijing leapt on the bandwagon when pop stars were the ones being accused. What would the Chinese Communist party do once the scrutiny turned on one of its own?
Censor, of course. It wasn’t long before Peng’s post, account and all references to the statement were scrubbed clean from social media. For a time even the word ‘tennis’ was censored as a search term. Then came radio silence from Peng — until last week. Presumably in response to growing international pressure (the Women’s Tennis Association has threatened to cancel all China events, and tennis stars from Serena Williams to Novak Djokovic rallied around the hashtag #WhereIsPengShuai), a series of ‘proof of life’ videos, photos and emails of Peng in public have surfaced. But these have all come from state media sources, such as the Global Times, leading to questions about how scripted they are. One video even starts with a director off-screen cueing Peng’s coach to start talking. In the coming weeks, state media outlets are likely to continue disseminating these staged appearances. It allows the Chinese government to present interest in Peng’s story as ‘western media hysteria’. But while no one is quite sure where Peng is, she has revealed a rot at the highest level of the party, a dangerous thing to do in Xi’s China. It’s a story as old as sin. In China’s imperial past, men were entitled to have a wife and as many (legally inferior) concubines as they could afford. Emperors would have hundreds, and even now a mistress is referred to as a ‘concubine’; a wife is an ‘empress’. Polygamy was officially abolished in 1949 with the communist takeover, but the mindset didn’t change much. Read the full story in the article in the November 27, 2021 issue of The Spectator. Overall, Media Bias/Fact Check (MBFC) rates The Spectator UK Right-Center biased based on story selection and editorial positions that moderately favor the right. They also rate them Mostly Factual in reporting, rather than High, due to misleading articles and a few failed fact checks regarding climate change. Their review was last updated on April 20th, 2021.

Bosnian Serb leader: Putin and China will help if west imposes sanctions According to a November 29, 2021 article in The Guardian, Milorad Dodik has dismissed the threat of western sanctions and has hinted that China and Russia would come to his assistance. Dodik said that he would not be deterred and that sanctions and cuts to E.U. funding would only force him to take up offers of investment from China and that he expected to see Russia’s leader “pretty soon.” Dodik also insisted his plans need not lead to the end of Bosnia-Herzegovina.

Milorad Dodik and Vladimir Putin at the Kremlin in 2016. ‘He just says, “What is it I can help with?”,’ Dodik said of Putin. Photograph: Alexei Nikolsky/Sputnik/Kremlin/EPA

The Chinese Dream A Visiting Professor in the Department of War Studies, King’s College London and a Professor of Strategic Theory at King’s College London argue the UK is not taking seriously the threat China poses to national security, stability and prosperity.The Central Committee of the Chinese Communist Party (CCP), the Party’s highest decision-making body, met for the sixth plenum of its current cycle earlier this month. Although little remarked upon in the West, the plenum passed an historic resolution, only the third such in its hundred year history. The resolution attributes China’s resurgence, power, and wealth to actions taken by Xi Jinping and the CCP. The resolution paves the way for the next party congress in 2022 to confirm Xi Jinping as the Party’s General Secretary and leader of the country ‘forever’. The Central Committee’s decision represents a significant concentration of power in the leader of this one party state. The UK government and the mainstream media’s failure to recognize the implications of this latest stage in China’s development as a totalitarian despotism is disquieting. The CCP, and its dictatorial leader, represent a serious threat to a United Kingdom struggling to recover from the social and economic devastation wrought by Covid-19 and successive lockdowns. Unlike other threats to national security that emerge from outside or within the UK, China directly challenges both the UK’s internal security and its interest in securing a rule-governed, international post-pandemic order. The UK thus needs a far more coherent defence and foreign policy posture to address the threat from China.
In foreign policy terms, the challenge China poses to the UK starts in Taiwan and moves South. The UK’s commitment to the Indo-Pacific and the negotiation of AUKUS is a promissory note that has to take account of the potential for conflict both in the South China Sea and over the status of Taiwan. Since 1949, China has considered Taiwan to be a rebellious province. It is increasingly considered ripe for forcible reunification with the mainland. The UK has traditionally been an open society and, prior to its baleful period of EU membership, committed to free trade with the world. However, a revitalized UK foreign policy must now confront what the Chinese Communist Party intends, by the centenary of its foundation in 2049, to be a world system that functions on its terms. This is a world order that will not be moving towards liberalism. As Xi Jinping made clear in his speech to the twelfth Party Congress in 2013: ‘To accomplish the Chinese Dream we have to take a Chinese path. This is the path of socialism with Chinese characteristics. This is not a path that opens up by itself.’ In order to retard the Chinese Dream, the UK will need to balance its growing commercial interests in the Indo-Pacific with deterring Chinese adventurism. It is in its post Brexit shift to the Indo-Pacific where the vital importance of the UK’s special relationship with the US will need careful calibration to ensure neither increased dependency on an unreliable US President, nor kowtowing to China. 
In this context, the UK needs to attend carefully to what other like-minded democracies are saying and doing. Significantly, Australia declared that the prospect of high intensity conflict is now less remote than it was, in its most recent strategic defense review, but also noted that more ‘grey zone’ incidents are already occurring. The Japanese also recognize the growing threat from China. For the first time, Japan has removed Taiwan from its map of China and has dedicated separate chapters of its latest defense review to Taiwan and the communist-ruled mainland. 

                                                         TAIPEI (Taiwan News)

The review notes the growing CCP threat to the island and states that, ‘it is necessary that we pay close attention to the situation … more than ever before.’ The tone and relative precision of Britain’s allies in the Asia-Pacific stands in marked contrast to the contradictory and languid prose of the UK’s most recent Integrated Review which vaguely proposes to ‘do more to adapt to China’s growing impact on our lives’. Tellingly, the Australian, Japanese and US responses to China’s regional adventurism offer a more pragmatic guide and a better insight into dealing with China’s global ambitions. We should therefore recognize, as Australia, Japan and the US already do, that the unveiling of Communist China’s hostility to the free World has been a key geo-political development in the post-Covid world. Their essay on CIEO’s website is here.

China accuses the EU of threatening global trade China accuses the EU of threatening global trade, according to an article in the Financial Times. The Chinese ambassador to the EU said the European Commission’s drive to sharpen its trade toolkit was seen by some businesses as heralding “more inward-looking and unilateral measures” and the creation of “new trade barriers”. The Financial Times of November 15, 2021 (subscription needed)

A New Chinese National Security Bureaucracy Emerges An intriguing aspect of General Secretary Xi Jinping’s political consolidation was the establishment of a Central National Security Commission (CNSC; 中央国家安全委员会, Zhongyang guojia anquan weiyuanhui ) at the end of 2013. The CNSC seemingly empowered Xi, who was put in charge of the new body, and through a permanent staff structure, perhaps set the stage for more effective strategic planning and crisis response. Over the last few years, subordinate National Security Commissions (NSCs) have been installed at all tiers of the party structure down to the county level. The CNSC thus sits atop a new organizational hierarchy that strengthens Xi’s ability to set the agenda and improves the party’s ability to coordinate national security affairs. While the system’s political utility for Xi is clear, its role in improving crisis response at the local level could be constrained by several factors.
The CNSC fits into a larger construct known as the “national security system” (国家安全体系, Guojia anquan tixi) that has been developed during the Xi era to protect the party from domestic and foreign threats. The ideational core of the system is the “holistic national security concept” (总体国家安全观, zongti guojia anquan guan) that Xi outlined at the first CNSC meeting in April 2014 . The concept’s key characteristic is that the party cannot think of security in narrow, traditional terms. Rather, the concept must be defined more broadly to encompass diverse areas such as cybersecurity, biosecurity, energy security, and counterterrorism, many of which involve interactions between domestic security and the outside world—Xi mentioned 11 areas in total. Other changes complemented the implementation of this emerging security system, including reforms to the People’s Armed Police (PAP), new laws on espionage, NGOs, and cybersecurity [2], and a formal “national security strategy” (国家安全战略, Guojia anquan zhanlüe). In November 2021, the Politburo deliberated the second such “strategy,” which will cover 2021-2015; an earlier document was approved in 2015. Read the full article in Jamestown’s China Brief of November 23, 2021.

Fears over Mandarin shortage in Whitehall ‘China Spy Blitz’ and ‘UK spooks hiring Mandarin speakers in cyber war’, according to the Sun on November 23, 2021. Spy bosses, the paper reports, are embarking on a recruitment drive, directed at people who speak the language or have grown up within a multilingual family, with MI5, MI6 and GCHQ all increasingly wary about a moment of reckoning with the Communist superpower. Yet while the secret services have woken up to the threat posed by Beijing, others within government appear to still be fast asleep. Newly obtained figures reveal that the number of fluent Mandarin speakers within the Foreign Office (FCDO) has dropped by nearly 10 per cent since 2016. A Freedom of Information request by Mr Steerpike showed that 41 British diplomats hold the ‘gold standard’ certification in Mandarin, known as C1, down from 45 over the past five years. Such figures refer only to the number who have passed the C1 exam and do not reflect the number of total staff who speak some level of Mandarin within the department. C1 exams are valid for five years, with diplomats then expected to re-qualify.
Since the summer of 2016 – when David Cameron was heralding a new UK-China ‘golden era’ – relations between the two countries have deteriorated rapidly over Beijing’s atrocities in Xinjiang, the subjugation of Hong Kong and the handling of the Covid pandemic. Yet despite the government admitting in its landmark defense paper in March that China is the ‘biggest state-based threat’ to the UK’s economic security and presents a ‘systemic challenge’ to Britain, there are cross-party concerns within Parliament that the Foreign Office is not moving quickly enough to improve Chinese language skills within the UK’s diplomatic corps. Read the full article in The Spectator of November 23, 2021.

In the Russian Arctic, China treads on thinning ice Although China now plays an increasingly important role in the Arctic, the restrictive nature of Arctic regional governance will continue to make Beijing’s fortunes in the region conditional on the support of the Arctic littoral states. China’s main Arctic partner, Russia, may soon revert to its traditional stance of trying to limit Beijing’s influence in the Arctic, due to growing tensions with the United States, concerns over China’s increasingly independent Arctic diplomacy, and disappointment over a lack of concrete Chinese investment. In order to reach its goal of becoming a ‘polar great power’ China will need to lessen its dependence on Russian support and expand its economic and political ties with other Arctic states. This may present Arctic states with an opportunity to set limits on China’s regional influence, but the benefits of any such limitation must be measured against the importance of giving China a stake in the fight against climate change.
In the traditionally calm waters of the Arctic, China’s ‘Arctic Policy White Paper’ made much of a splash when it was first released in 2018. The paper showed, as was argued at the time by politicians and pundits, that Beijing would seek to establish itself as a new Arctic power, and in the process deprive the eight Arctic states of their control over the region’s abundant natural resources. But while it is true that China today plays an increasingly important role in Arctic affairs, especially so in its role as a major investor into Arctic economies, many of the concerns around China’s growing influence in the region have turned out to have been largely overblown. More in this LSE China Dialogue, and in this Carnegie publicationfunded by the Russia Strategic Initiative U.S. European Command, Stuttgart Germany.

Technical Stakeholder Consultation on Proposed Electronic Communications Security Measures (ECSMs) Hostile states will be ‘greatest risk’ to 5G network – Irish government report. The report did not make specific references to countries that pose a threat to Ireland’s telecoms sector but did refer to hacking groups such as APT 10, which is run by the Chinese Ministry of State Security.

Towards a Data-Centric Great Game: New Challenges for Small States in Contemporary Power Politics The goal of every nation’s security and defense policy is to maximize its ability to act in all security scenarios. This is underscored in the Finnish Government’s Defence Report 2021. Yet, as leading states develop and deploy a growing number of offset data-driven technologies to maintain asymmetric advantages over their competitors, the task is arguably increasingly challenging and less understood in practice – especially by smaller states. The U.S. Department of Defense’s 2020 Data Strategy rightly recognizes that in today’s world, data is the “primary and permanent asset” with which global influence, security and prosperity are ensured. It is clear that a data-centric approach is the core element in the ongoing geopolitical competition as “an essential and integral part of the [national security] mission itself”. The key to a data-centric approach is the alchemy of turning data from a passive element into a more dynamic, smarter, and more refined entity. The move to a data-centric approach, where data is the key resource and enabler of desired outcomes, is not a simple technical upgrade. Rather, it is a profound transformation of organizational culture whereby trusted, dynamic collaboration between siloed entities is a fundamental necessity in order to understand and plan for the types of data and data formats that exist and that are needed in an organization.
Naturally, the move to data-centricity involves technological activities as well. Yet instead of involving infrastructure-wide and massively expensive big bang upgrades, a more subtle and accessible mixture of existing legacy systems, new technologies, and cross-platform data flows can be utilized to create defensive and offensive capabilities for interstate competition, for example. Instead of being out of reach for smaller actors, this type of multimodal approach enables a new way of looking at data and understanding it not only in terms of something to be secured, but in terms of catalyzing it for proactive capabilities and deterrence. Data-driven technology is evolving exponentially and, accordingly, we are witnessing accelerating competition on the world stage, where the stage itself and the norms bound to it are simultaneously transforming.
For example, the stage is increasingly inhabited by actors who are not constrained by wishful public statements to forego abusing (digital, financial, informational, and other) interdependencies. Moreover, to add insult to injury, these interdependencies are too often governed by rules which are animated by drivers that do not fit existing understandings of defence, security or resilience. As a result of these structural transformations, the nature of distributional capabilities is changing as the US and China engage in intensifying strategic competition in all domains, and as other traditional and emerging actors try to stay in the game or mitigate the implications of the overall radical shift. Yet the rapid evolution of data-driven technologies is propelled by US market-based and Chinese state-centric companies, whose influence and power grow as they develop new markets, technologies, and standards, which govern these technologies and – through them – the new human activities that these technologies enable. This is a de facto form of power and disaggregated governance. It erodes and challenges the traditional rules-based international order in which standard-setting has typically, with delay, been conducted via international organizations, where major states have held sway. The complexities and potential trajectories for offset options defy even the most informed strategic planners, and create friction, delay, surprise, dependency and vulnerability for all states. For example, the dynamics of convergence and divergence coexist. Contemporary data flows contribute to the convergence of traditionally clear boundaries of the domestic and foreign, virtual and real, and peace and war. This multiplies the aspects of operational opportunity, enabling full-spectrum and multi-domain operations. Further, technological evolution enables (expensive) platforms that merge multiple capabilities with interdomain implications such as the 5th generation fighter aircraft platforms. At the same time, it enables the creation of (cheap) single-purpose platforms such as microdrones. Both developments are enabled by the convergence of data. 
This FIIA Briefing Paper is intended as a timely input into the emerging discussion on how the rapid evolution of technology creates previously unhighlighted consequences, which limit a nation’s ability to act in all security scenarios. FIIA, the Finnish Institute of International Affairs, is a research institute whose mission is to produce high quality, topical information on international relations and the EU. The Institute also publishes a journal, Ulkopolitiikka (Finnish Journal of Foreign Affairs), and maintains a specialized library.

Hard target espionage in the information era: new challenges for the second oldest profession Reliable and well positioned human sources are essential for the US and its allies in an era of declining relations and rising tensions with China and Russia. The recruitment and handling of spies is essential if the US and its allies are to cool relations carefully, enact sound policy and curb the relentless intelligence operations of their adversaries. However, despite the superficially more open borders of China and Russia, technological advances have made the threat of street surveillance to the recruitment and handling of agents today as acute as it was in Cold War “denied area” states. This paper assesses the degree of street surveillance in contemporary Russia and China – including the impact of biometrics and online data history on the defensibility of cover and the severity of advanced CCTV networks – and the solutions intelligence agencies might adopt to address these problems. Despite the possibilities cyberspace offers espionage – for instance, by reducing the need for face to face meetings between intelligence officers and agents – the paper establishes the limitations of technological answers and argues that Western intelligence officers are entering a new era of Moscow and Beijing Rules in which they are more essential than ever and yet need to operate with absolute caution.
In 2018, the Trump administration declared Russia and China to be the main security concerns of the United States, not terrorism. This move was hardly unanticipated. As former Defence Secretary James Mattis claimed, declining relations and rising tensions with these ‘revisionist powers’ have increasingly challenged US hegemony. But as military and intelligence resources are steered accordingly towards Beijing and Moscow, Humint, meaning in this case espionage – the recruitment and handling of spies – must play a primary role. The most important secrets, including the aims and intentions of President Xi and President Putin, are likely contained either in the minds of a select few or in heavily guarded vaults. Simply put, if the US and its allies are going to cool relations, enact sound policy, and curb the relentless intelligence operations of their adversaries, they are going to need reliable and well positioned human sources.
Yet in order to recruit and handle these human sources (better known as agents or spies), today’s intelligence officers must compete with the rising threat of street surveillance, a threat that has parallels with the Cold War. Street surveillance, meaning the physical observation of intelligence officers, is the Achilles Heel of espionage, allowing contacts, movements, and tradecraft to be mapped out. To avoid their watchers, intelligence officers run countersurveillance techniques, which in turn pushes up the amount of resources that counterintelligence must invest to keep a single person under observation. Rampant street surveillance was a hallmark of the Cold War’s ‘denied area’ states: restricted borders limited the intake of potentially suspicious foreigners into the Soviet Union, while massive KGB resources put the few who arrived under intensive observation. Everyone from students to tourists were watched to some degree, and those most likely to be intelligence officers – especially diplomats – were barely able to escape the KGB’s pervasive glare. Surveillance was so endemic, that the West developed a series of guidelines, known as Moscow Rules, to help intelligence officers navigate Soviet turf – most notably rule 1 ‘Murphy is right’, which might have been better expressed as assume nothing but the worst. But at their heart, Moscow Rules reflect a period of intense struggle, where every agent was hard won.
The laxing of Russian and Chinese borders in the post-Cold War world brought about greater opportunities for Western intelligence officers. Tourists and businessmen could travel to their major cities with relative ease, with a larger footprint of international travellers putting new strains on surveillance while offering more wiggle room for foreign operatives. However, today the advantages offered by these more open societies must be weighed against emerging technological threats. In recent years, technological developments have created new challenges to intelligence officers’ cover (the fake identities they use to enter and socialize in foreign environments), potentially allowing surveillance to function with unprecedented speed and efficiency. As argued by the former head of SIS, Alex Younger, today’s intelligence officers face an ‘existential threat’ brought about by the information age. These technological challenges have already been documented to some extent by scholars and former practitioners, including former CIA case officer David Gioe and former deputy head of SIS, Nigel Inkster, but have not received sustained examination in the context of specific hard targets. This paper thus attempts to examine the state of street surveillance in contemporary Russia and China, alongside the solutions that intelligence agencies might adopt to address the problems it presents. It aims to show that the West faces a new and fraught era of Moscow/Beijing Rules with no easy resolution and dire implications for the value of espionage. 

China and the Ministry of State Security. The state of affairs in China has drawn considerably less media attention, but it is clear that Beijing also puts surveillance at the forefront of its security. Traditionally, counterintelligence fell under the Ministry of Public Security (MPS), but following the economic reforms of Den Xiaoping in 1979, many of the MPS’s powers were absorbed by the Ministry of State Security (MSS), established in 1983. With the separation, MSS not only took the lead on foreign intelligence gathering (which it also absorbed from the Investigation Department), it also took the helm of counterintelligence missions including street surveillance and technical eavesdropping. The MPS is still responsible for policing and public order, but the MSS absorbed all offensive and defensive aspects of intelligence under one roof. In recent years, owing in part to China’s large and growing international community, the budgets of MPS and MSS have grown considerably. By 2010, China’s internal security budget already outstripped its immense military modernization budget by several billion, rising to 111 USD billion in 2012. While the portion of that funding spent on counterintelligence is unclear, it emphasizes China’s voracious appetite for security.
Even by the end of the Cold War, concerns about foreign espionage were high on the agenda. According to one leaked MSS document from the 1990’s, China perceived foreign diplomats as ‘open spies’, and placed numerous international journalists and business travellers under surveillance. By the 1990s, Chinese policymakers exhibited ‘what might be described in Western terms as a paranoiac fear of foreign influence’, and that fear has not abated amongst Chinese policymakers. In 2011, Major General Jin Yinan, speaking at what he wrongly believed to be a private conference, discussed several cases in which officials were found to be spying for foreign powers. One such case included Kang Rixin, a member of the CCP’s Central Committee, and head of China’s National Nuclear Corporation. Kang was publicly jailed for bribe-taking, but, in fact, was imprisoned for life after spying for an undisclosed foreign intelligence agency. Knowing that spies such as Kang were active in the CCP’s highest ranks made policymakers ‘extremely nervous’, but those fears were put on a legal footing in 2014, when Beijing replaced its 1993 National Security Law with a new Counterespionage Law, which grants greater powers for acting against foreign intelligence officers and ‘Chinese collaborators’. As analyst Scot Tanner told The New York Times, the law ‘sends a message that the party is concerned about – and may intend to more closely monitor – the relationships between many of its citizens and the international community with which China is increasingly intertwined’. Since 2014, street surveillance against intelligence officers and diplomats in Beijing has grown in intensity and aggression. As one American official noted, Chinese surveillance teams ‘were as fundamentally aggressive in their activity [as the Russians] … They always knew what we were doing and where we were’. Although the official described Chinese surveillance as more ‘subtle’ than their Russian counterparts, some incidents show a more dangerous trend. US officials told Newsweek that entrapment, through the rampant deployment of prostitutes, is a common tool of Chinese security services, which became a critical issue during the 2008 construction of the US embassy in Beijing: ‘[we] were constantly having to send people home for fraternization … That was a very big problem, keeping construction crews on site, because the Chinese clearly were trying to target them, but we kept a pretty careful handle on all of that’. US diplomats in China have reported constant and intense surveillance, alongside more intimidating tactics such as their apartments being broken into and ‘tossed’ (overtly searched). In 2016, an official from the US consulate in Chengdu was kidnapped, interrogated, and forced to confess to acts of treachery by plain-clothes security officers. The American, who was suspected of being a CIA officer, was eventually released and evacuated from the country, but the case is considered an ‘extreme illustration’ of the state of surveillance in Beijing.
Moreover, akin to Russia, travel restrictions ensure that if intelligence officers want to meet highly valued Chinese sources they will probably have to do so in hostile conditions. Currently, both serving and ex-Politburo members are not allowed to travel abroad without permission, including China’s former presidents. As argued by specialist on Chinese leadership, Bo Zhiyue, ‘[these] people have a lot of secrets … if there is a way to block that person [from leaving], they will do so’. Consequently, like their colleagues in Moscow Station, foreign intelligence officers in China will need to pursue most of their quarry in Beijing, where they are far more vulnerable to the MSS’s increasingly intensive and aggressive surveillance resources. The Research Article by a fixed-term lecturer in the Politics and Contemporary History Faculty at the University of Salford was published here on the 7th of July, 2021.

Chinese covert purchase Italian drone maker Alpi Aviation In 2018, two Chinese state-controlled companies bought an Italian manufacturer of drones, Alpi Aviation, via an offshore company. The Italian and European authorities had no knowledge of the move, revealing how Beijing is skirting weak investment screening in Europe to acquire sensitive technology. According to an article in Geopolitica, Italy was the first European state to endorse China’s Belt and Road Initiative in 2019, when President Xi Jinping visited the country on a three-day trip. The country was under the leadership of the first government of former Prime minister Giuseppe Conte, supported by the Five Star movement and the Lega led by Matteo Salvini. Two years and two governments later, Italy’s financial crime police (Guardia di Finanza, GdF) charged six managers of a private firm, Alpi Aviation s.r.l. headquartered in Friuli-Venezia Giulia, for violations of military-exports and the “golden-power” legislation.The firm, which produces drones, light and ultralight aviation aircrafts, is now in Chinese hands despite repeated warnings from U.S. diplomatic sources. Italy has become aware – and wary – of the covert manner through which China has acquired defense and high-technology firms, directly impacting national security. 
According to recent investigations, in 2018 two Chinese state-owned companies took over control of the firm without formal disclosure to the relevant Italian authorities. Alpi Aviation is a leader in the production of military drones, aircraft and spacecraft, and supplies the Italian ministry of Defence as well as Leonardo S.p.a., the leading Italian aerospace company partly owned by the ministry of Economy with a 30% share. Among others, Alpi Aviation produces the Strix UAV, which was used by the Italian Air Force in Afghanistan. It weighs 10 kg, has a 3-meter wingspan, and can relay video and infrared imagery in real time. It takes 8 minutes to set it up, and then it is launched by catapult and is equipped with a parachute for landing. The charges filed against Alpi Aviation are fundamentally two: breach of the law that governs the export of arms and the so-called “golden-power” legislation, which was introduced in march 2012 to protect Italy’s strategic companies in the defence, energy and telecommunications sectors. Alpi Aviation had previously been investigated by the GdF for the alleged violation of the international embargo on Iran through the sales of military drones via a Japan-based company. More in this article.

Hikvision and Dahua Surveillance Cameras: Global Locations Report According their updated report, Top10VPN identified 6.3 million surveillance camera networks outside China that use hardware from controversial Chinese firms Hikvision and Dahua, with significantly more in Vietnam and the U.S. than anywhere else. The key findings are:

  1. 6.3 million Hikvision and Dahua surveillance camera networks detected outside China worldwide (Hikvision: 4.8 million networks and Dahua: 1.5 million networks)
  2. 191 countries outside China where Hikvision or Dahua camera networks are present
  3. 148 countries have more than 100 such IP camera networks
  4. Vietnam and the U.S. account for 25% of all such Hikvision and Dahua networks detected outside China. Each has more than double the number found in Mexico, the UK and Brazil, the countries with the next highest total networks.
  5. Ho Chi Minh City – city with most Hikvision and Dahua networks detected, followed by Hanoi, Bangkok, London and Montevideo.

Laundering Cotton: How Xinjiang Cotton is Obscured in International Supply Chains More than 100 global retail brands could be at risk of using cotton that is produced by Uyghur forced labour according to new research by Sheffield Hallam University’s Helena Kennedy Centre for International Justice. By analysing supply chain connections identified through shipping records, the research suggest cotton from the Uyghur Region bypasses supply standards to end up around the world. The findings suggest dozens of well-known international brands are at risk of using cotton that is produced or processed by forced labour in the Xinjiang Province in China.  The report found that more than 100 well-known retailers are at risk of using cotton produced through forced labour. ‘It leaves many leading brands with nowhere to hide’. Researchers used publicly accessible customs data to investigate five leading textile companies to identify some of the routes by which Xinjiang cotton may be reaching international consumers. 

Photograph: AFP

The report identifies 53 contract garment suppliers—in Indonesia, Sri Lanka, Bangladesh, Vietnam, India, Pakistan, Kenya, Ethiopia, China, and Mexico—that reportedly purchase fabric and yarn from five leading Chinese manufacturers that, according to the authors, use Uyghur Region cotton. The suppliers use the fabric and yarn in the clothes they make for leading apparel brands, with no indication to consumers of the cotton’s origin. The report concludes with recommendations that governments and corporations should put in place mandatory human rights and environmental due diligence legislation to ensure forced labour made goods do not reach consumers. 
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Outcomes of the Biden-Xi virtual summit An optimist would say that at least they met, a pessimist that at the most they met – and then only virtually, online. Little concrete came out of the meeting between Joe Biden, President of the United States, and Xi Jinping, General Secretary of the Chinese Communist Party (CCP). And neither side would have expected it. But after the years of President Donald Trump’s unpredictability and the poor start of the Anchorage meeting in March 2021 when Anthony Blinken, US Secretary of State, and Yang Jiechi, the CCP’s most senior foreign affairs official, traded diplomatic ‘un-niceties’, the tone, if not the content, of the meeting will have helped, as Xi called for, to pave the way for future exchanges ‘at all levels and in all areas’  between powers with increasingly divergent agendas. 
Commentators like to make much of the importance of personal relations in diplomacy. As vice-presidents of their respective countries, Biden and Xi had long meetings and chats. While it is true that a personal dislike can hinder understanding – even leaders are human – it is wrong to think in the context of the CCP that friendship exists or influences talks. Biden and Xi are not Margaret Thatcher and Ronald Reagan, two politicians of very similar views. It is unwise for top CCP leaders to have foreign friends and open themselves to accusations of not following completely the interests of the People’s Republic of China (PRC); moreover, the interposing of interpreters and decades between meetings dampens ardour. The American read-out of the meeting was short and factual. By contrast the Chinese was expansive. For the CCP, the meeting had two major aims. As usual for any negotiation at the start of a long-term relationship with a new opposite number, the CCP wanted to put down a set of principles. The aim is that if future US behaviour diverts from CCP desiderata, then the PRC can declare that the US is at fault for departing from agreed principles. The second aim was domestic: the CCP wishes to show its people that it is now the equal of the US, that its policies are correct, that the PRC is ‘great again’ (and therefore the party is to be cherished).
The Chinese press has made much of the ‘three principles and four priorities’ laid out by Xi at the meeting as ‘the right way for China and the United States to get along in the new era’. More in this Council on Geostrategy’s “long read“.

U.S.-China Commission Releases 2021 Annual Report to Congress The U.S.-China Economic and Security Review Commission released its 2021 Annual Report to Congress part of its mandate to investigate, assess, and report to Congress annually on “the national security implications of the economic relationship between the United States and the People’s Republic of China.” This year’s report addresses key findings and recommendations for congressional action based upon the Commission’s hearings, research, and review of the areas designated by Congress in its mandate. Report chapters and sections this year include:
– China’s Influence in Latin America and the Caribbean
– The Chinese Communist Party’s Ambitions and Challenges at Its Centennial
– The Chinese Communist Party’s Economic and Technological Ambitions
– The Chinese Government’s Evolving Control of the Nonstate Sector
– U.S.-China Financial Connectivity and Risks to U.S. National Security
– China’s Nuclear Forces: Moving beyond a Minimal Deterrent
– Chinese Military Capabilities and Decision-Making for a War over Taiwan
– Hong Kong’s Government Embraces Authoritarianism
– Issues related to security, politics, and foreign affairs

The Future of the Digital Order Nations that successfully harness the vast economic, political, and societal power of emerging information and communications technologies will shape the future of the global digital order. But this future is not set in stone. A closed, illiberal order is taking root in strategic regions around the world, as non-democratic governments exploit digital tools to grow both internal control and external influence. A comprehensive new CNAS report examines how China, Russia, and various Middle Eastern governments are cultivating this new digital order across three pillars: information control, surveillance, and technology governance. The report reveals four key trends with implications for the future:

  • Growing China-Russia alignment will generate dangerous digital synergies.
  • Countries around the world, particularly autocratic regimes and those flirting with illiberalism, will seek to regulate online communications platforms through social media, data localization laws, and instigating company self-censorship.
  • Illiberal regimes will seek out Chinese technology to help them control social movements and civil protests.
  • The practices of illiberal regimes will reduce the efficacy of U.S. mitigation practices. Russia and China’s efforts to promote an illiberal digital order complement one another and could accelerate innovation between the two nations.

The Future of the Digital Order draws on expertise and research from across CNAS’ Technology and National Security, Indo-Pacific Security, Middle Eastern Security, and Transatlantic Security programs. The U.S. must craft a policy response that considers these emerging patterns and incorporates more than its usual partners in Europe and the Indo-Pacific. Shoring up the existing coalition of democratic actors to counter these illiberal trends will likely not be sufficient. The authors offer recommendations that the United States can implement on three fronts: at home, while engaging with traditional U.S. democratic as well as nondemocratic partners, and when countering U.S. adversaries such as China, Russia, and Iran. “An open digital order is the only way to ensure the trust and integrity of technological ecosystems, inclusive growth and shared prosperity, and innovation imbued with universal rights,” the report warns. “Authoritarian uses of technology threaten the strength and resilience of democratic values and institutions.”

Major Power Rivalry and the Management of Global Threats In this new CFR report, a senior fellow at the Center for Security, Strategy, and Technology at the Brookings Institution, urges the United States to regard distrust—not cooperation—as the baseline condition for starting negotiations around shared global threats and challenges with other major powers, such as China and Russia. 

China’s burned-out tech workers are fighting back against long hours The draining 996 work schedule—named for the expectation that employees work 9 a.m. to 9 p.m., six days a week—has persisted in Chinese companies for years despite ongoing public outcry. Even Alibaba co-founder Jack Ma once called it a “huge blessing.” In early October this year, it seemed the tide might have been turning. After hopeful signs of increased government scrutiny in August, four aspiring tech workers initiated a social media project designed to expose the problem with the nation’s working culture. A publicly editable database of company practices, it soon went viral, revealing working conditions at many companies in the tech sector and helping bring 996 to the center of the public’s attention. It managed to garner 1 million views within its first week. 
But the project—first dubbed Worker Lives Matter and then Working Time—was gone almost as quickly as it appeared. The database and the GitHub repository page have been deleted, and online discussions about the work have been censored by Chinese social networking platforms. The short life of Working Time highlights how difficult it is to make progress against overtime practices that, while technically illegal in China, are still thriving. But some suspect it won’t be the last anonymous project to take on 996. “I believe there will be more and more attempts and initiatives like this,” says programmer Suji Yan, who has worked on another anti-996 project. With better approaches to avoiding censorship, he says, they could bring even more attention to the problem. More about this viral online project exposing the punishing 996 work schedule, and showing how hard it is to make progress against it, in this article (MIT Technology Review, subscription needed).

Do cyber spies dream of electric shadows? Alice sits at a bar with Bob, a travel consultant she has been seeing socially since she met him a few weeks ago in the lobby of the building where she works as a network administrator. Her company develops IT systems for the military. Bob isn’t actually a consultant but a foreign intelligence officer who has been influencing Alice to sell state secrets. He is facing away from the closed-circuit TV camera above the counter, but he’s oblivious to the fact that his movements have been tracked via facial recognition ever since he arrived in the country. Bob’s true identity was revealed in a ransacked personnel database and the microphone on his smartphone was hacked through a zero-day vulnerability to record Alice breaking the law. While this story is fictional, it highlights how pervasive surveillance, online personal data and new technologies such as trackable devices are making it harder for states to collect intelligence from human sources (commonly referred to as human intelligence, or HUMINT), which includes a range of activities whose core purpose is to recruit an individual to ‘spy’.
In this new era, espionage will pit tech against tech to avoid detection and create more plausibly deniable covers. Covert communications will likely become more sophisticated to avoid detection, but HUMINT collection agencies could further collaborate with their technical counterparts to take full advantage of other emerging technologies to protect their intelligence officers and agents on the ground. Cyberspace is changing spycraft, and national security agencies are being urged to adopt machine learning and open-source data to bolster their analytical capabilities. Human intelligence and networks of informants, however, will remain necessary for acquiring some secrets, assisting cyber operations by placing USB drives in air-gapped computers, for example, and providing insights into the thinking of decision-makers in target countries. To establish trust between officers and their informants, interpersonal and face-to-face meetings may be unavoidable while virtual reality and other digital technologies mature. In countries like Russia and China, some experts have argued that traditional HUMINT tradecraft has become obsolete due to the use of facial recognition, biometric scanning and internet-connected devices that leave ‘digital dust’ for counterintelligence officers to detect. This has followed a New York Times report claiming a top-secret CIA cable revealed that dozens of informants working for the US had been compromised or killed in these increasingly difficult operating environments.However, technological advances haven’t been fully utilized yet and present an opportunity for HUMINT collection agencies like the CIA, MI6 and the Australian Secret Intelligence Service to work with the NSA, GCHQ and Australian Signals Directorate to develop new HUMINT tradecraft. For example, new covert communication techniques could take advantage of anonymizing technologies that are already challenging counterintelligence in open democracies. More in the November 11, 2021 issue of The Strategist.

Sliding-door moments: ANZUS and the Blue Pacific  This new ASPI special report canvasses important lessons from the 70-year history of ANZUS in the Pacific Island region and how those lessons bear on Australia’s Pacific Step-up, New Zealand’s Pacific Reset and the United States’ Pacific Pledge. While most of the moments examined in the report centered on decisions that seemed inconsequential at the time, the same can’t be said of the current pivotal juncture in regional security. The risks of the current period of strategic flux are recognized as both high and escalating.

The World Is Fed Up With China’s Belligerence In Chinese-speaking communities beyond the reach of Beijing’s censorship regime, the song “Fragile” has been an unexpected hit. With more than 26 million views on YouTube since dropping in mid-October, the satirical love song to Chinese nationalism has topped the site’s charts for Taiwan and Hong Kong, its lyrics mocking Chinese Communist Party rhetoric about Taiwan while also taking aim at Xi Jinping and Chinese censors. In parts, the Mandarin Chinese duet portrays Taiwan as an object of unwanted overtures that simply wants to get along with a hypersensitive and aggressive Beijing. Its chorus goes full it’s-not-you-it’s-me: “Sorry I’m so strong-minded / The truth always upsets you / Maybe I shouldn’t be so blunt / I’m so sorry / I’ve angered you again.” The song, by the Malaysian rapper Namewee and the Australian singer Kimberley Chen, seems to have hit all the right notes for those tiring of a perpetually offended and angry China—and resulted in the scrubbing of the duo’s Chinese social-media accounts.

Ben Hickey

In Taiwan, where many pop stars stay out of the political realm to retain access to China’s lucrative market, the song has been greeted as a refreshing, and rare, send-up of its giant neighbor’s refutation of Taiwanese sovereignty. (Beijing claims that Taiwan is its territory, though the CCP has never controlled it, and Taiwanese overwhelmingly reject the idea of unification.) Yet it is also a sign of something more: Its lyrics and its context mirror the actions of democracies around the world that are growing tired of walking on eggshells to avoid angering a petulant Beijing. Rather than releasing a song, officials in Europe, Japan, and Australia are expanding long-ignored relationships with Taiwan. China’s foreign ministry has lambasted and threatened them all, but echoing the song’s ethos, they are no longer as worried as they once were about offending a fragile Beijing.
The phrase—a touchstone of news reports about the Chinese government’s countless and often shifting red lines—will be familiar to anyone who has read about China in the past several years. The context in which it is now used, however, is markedly different. Not long ago, the Chinese government was economical and targeted with its outrage, typically lashing out only over what even critics might regard as major issues from Beijing’s point of view, such as French President Nicolas Sarkozy’s meeting with the Dalai Lama in 2008 (the CCP regards him as a Tibetan separatist), or the liberal activist Liu Xiaobo’s being awarded the Nobel Peace Prize in 2010 (Liu advocated for issues that are anathema to the CCP, such as greater individual political freedoms).
“Now China just picks fights out of arrogance and bullying,” Jorge Guajardo, Mexico’s ambassador to China from 2007 to 2013, told me. When Beijing, immediately following Ottawa’s release of Huawei’s chief financial officer, Meng Wanzhou, held as part of an extradition case, released two Canadians it had detained and isolated for more than 1,000 days, it seemed a clear message to the world that hostage taking has been added to its diplomatic toolbox. Where the word Beijing once conjured the image of a confident, rising power, today it represents a frowning, finger-pointing, never-erring crank, its constant stream of vitriol diminishing the effectiveness of Chinese anger. One of the implications of this hyperinflation of hurt feelings has been the effective removal of the deterrent against democracies’ improving their unofficial relations with Taiwan. After all, if most moves are likely to anger Beijing, why hold back from any of them? The United States has led the way in expanding ties with Taiwan while grappling with an increasingly prickly China. This began under the Trump administration, and has continued under Joe Biden, who in his first year in office has twice said that the U.S. is committed to defending Taiwan from Chinese attack. (For the past four decades, the U.S. has had an unofficial policy of not publicly saying how it would respond to a China-Taiwan conflict, in the hope of not emboldening either side to start one.) This excerpt is from an article, written by a Taipei-based journalist, and published in The Atlantic.

Chinese economic statecraft: what to expect in the next five years? The start of economic reform under Prime Minister Zhu Rongji and President Deng Xaoping in the late1980s was widely seen as the turning point for the trajectory of Chinese economy. Key to the reform was the increased private ownership of the production of goods and services as well as the opening to trade and foreign direct investment. The reason for the push toward private ownership is not so much ideological – China remains a socialist country – but pragmatic. Private-owned enterprises’ (POEs) return on assets has remained stubbornly higher than that of state-owned enterprises (SOEs) – and not just centrally owned state enterprises but local state-owned companies, too. More importantly, state-owned companies having undergone partial private privatization, and the so-called mixed ownership companies also tend to have high returns on assets. In other words, China’s economic success cannot be understood without the dynamism of its private sector and its openness to the rest of the world. This chapter from ‘Storms Ahead (“the Future Geoeconomic world order’ on the expectations from the next five years of Chinese economic policy”) is written by a senior research fellow at Bruegel, and adjunct professor at Hong Kong University of Science and Technology, and published on 27 October 2021.

How to protect the Czech economy from foreign predators and malign influence In this paper, the EVC (the European Values Center for Security Policy, based in Prague, Czech Republic) identifies the People’s Republic of China’s (PRC) key objectives and tools of economic influence, and formulates a comprehensive set of potential countermeasures that can and should be adopted by the Czech Republic or be advocated for by the Czech Republic in the European Union.

Prague / Photograph: William Zhang

These measures stand to help protect businesses, research & development, and strategic technologies. The report could serve as a source of policy inspiration for any other democratic state, primarily within the EU. The PRC’s tools of economic influence and possible countermeasures presented in this paper were identified and formulated by the EVC primarily based on the findings of the interviews with 30 Czech and international stakeholders with expertise in business development, China’s foreign policy, and national security. EVC formulated a set of possible counter-measures that should be introduced or enforced in the Czech Republic at the EU level, in the area of:

  • protecting enterprises and technologies
  • responding to pressure trade policy
  • addressing economic vulnerability
  • preventing hidden and illegitimate financing
  • responding to corruption and human rights violations in economic relations
  •  strengthening knowledge and understanding of China’s economic influence
  • protecting universities and research institutes

Better Together: The Case for a Technology Alliance The Center for a New American Security (CNAS) has released a new video called “Better Together: The Case for a Technology Alliance.” The United States faces a challenge like no other in its history—a strategic competition with a rising China. Technology is at the center of this competition. America needs a national technology strategy to drive innovation, mitigate risk, and compete for security and prosperity. But America cannot compete alone. The U.S. approach to technology must involve partnering with like-minded countries. A new video explainer from CNAS explores how the United States and other tech-leading democracies should create a technology alliance to collaborate on big issues, such as groundbreaking research and development, securing supply chains, and defending technology norms rooted in democratic values. This latest release is the third in a series of videos on the need for a U.S. national technology strategyWatch the first and second videos in the series.

Serbia’s emergence as China’s new strategic hub The Balkan region has become a Chinese strategic hub that could finally connect the Port of Piraeus in Greece, which China acquired in 2016, with central European countries, and thus EU markets, says Giorgio Fruscione from the Italian Institute for International Political Studies. Therefore, China is fighting for influence in Serbia, in its effort to override Russia, Turkey and the Gulf countries, primarily the United Arab Emirates. Serbia remains dependent for energy on Russia, with which it also cooperates militarily. UAE has become Belgrade’s main partner in the Arab world over the past nine years, with growing partnership in the fields of aviation, urban construction, agriculture, and defense. On the other hand, Beijing has recently expanded cooperation with Belgrade in various fields. The total trade between Serbia and China has been steadily growing over the last decade. According to the Development Agency of Serbia’s data, China accounts for 8.9% of the total value of foreign direct investments.

In the center of Belgrade, Chinese President Xi Jinping’s face now peers out from a billboard with the words “Thank you brother Xi”, a message paid for by a pro-government tabloid. Photograph: Reuters/Djordje Kojadinovic

In 2016, after a visit by Chinese President Xi Jinping to Serbia, China’s Hesteel took over a troubled steel mill, previously owned by US Steel. In 2018, China’s Zijin Mining acquired the country’s only copper mining complex, burdened by debt. The Chinese company Linglong, the main sponsor of Serbia’s top soccer league, is building a nearly $1 billion tyre factory. In January 2021, Chinese company Power Construction Corporation, together with French firms Alstom and Egis, signed a memorandum with the Serbian government on the construction of the initial two lines of the Belgrade Metro. While the government is welcoming Chinese investors who take over old industrial sites, locals and activists say they are suffering the environmental consequences. In a recent report, the European Parliament expressed concern about the lack of transparency and environmental and social impact assessment of Chinese investments and loans in Serbia and across the Western Balkans. More in this article (this article originally appeared in EURACTIV Bulgaria)

China’s Mass Internment, Torture and Persecution of Muslims in Xinjiang Since 2017, the government of China has carried out massive and systematic abuses against Muslims living in the Xinjiang Uyghur Autonomous Region (Xinjiang). The human suffering has been immense. Huge numbers of men and women from predominantly Muslim ethnic groups have been arbitrarily detained and sent to internment camps or prison. The internment camp system is part of a larger campaign of subjugation and forced assimilation of ethnic minorities in Xinjiang. From late 2019 to mid 2021, Amnesty International has been investigating these abuses. On 10 June 2021 Amnesty published a report based on new first-hand testimonies gathered from former detainees of the internment camps and other people who were present in Xinjiang after 2017, as well as from an analysis of satellite imagery and data. The report provides the most comprehensive account ever of life inside the internment camps. The evidence Amnesty International has gathered provides a factual basis for the conclusion that the Chinese government has committed at least the following crimes against humanity: imprisonment, torture, and persecution. The government’s abuses are ongoing. Large numbers of people are still arbitrarily detained in Xinjiang. Moreover, the government has devoted tremendous resources to concealing the truth about its actions. It prevents millions of people living in Xinjiang from communicating freely about the situation and denies journalists and investigators meaningful access to the region. People living abroad are often unable to obtain information about family members in Xinjiang who are missing and presumed to be detained.
Note: Media Bias Fact Check rates Amnesty International left-center biased based on political advocacy that favors liberal policy. They also rate them High for factual reporting due to proper sourcing and a reasonable fact check record.

Counterintelligence Chief Warns of Threats to U.S. Emerging Tech The National Counterintelligence and Security Center, which leads U.S. counterintelligence efforts, is prioritizing the defense of five key technologies (AI, autonomous systems, semiconductors, quantum computing, and biotech) in the face of threats from China and Russia. According to a document released by the NCSC, the NCSC will increase its outreach to companies and researchers in these fields to help them guard against economic espionage. Mike Orlando, who took over as acting director of the NCSC earlier this year, said these state-backed campaigns have targeted “hundreds of billions of dollars’ worth” of U.S. Technology, through both illicit and licit means. While a number of espionage cases (including unsuccessful ones) have drawn attention to the former, Orlando warned that some forms of legal cooperation — including research partnerships, acquisitions and investments, and talent recruitment — also put U.S. research at risk. In addition to stepped-up outreach efforts, the NCSC has created a new position focused specifically on counterintelligence for emerging and disruptive technologies.

Shanghai Municipal “14th Five-Year” Plan for Building a Science and Technology Innovation Center with Global Influence This CSET document is an excerpted translation of Shanghai’s five-year plan for S&T development. This is one of many detailed provincial-level economic development plans likely to follow in the wake of China’s national 14th Five-Year Plan, which was released in March 2021. Shanghai’s plan identifies a raft of emerging technologies that the city government aims to boost, and proposes a major expansion and refinement of the city’s tech transfer apparatus. This lengthy translated excerpt covers the following sections of Shanghai’s plan: part I (overview), part III (basic research and innovation), part IV (key and core technologies), part VI (talent), and part X (innovation environment).

Hackers are stealing data today so quantum computers can crack it in a decade Hackers might pose an immediate threat, but US government officials are preparing for another, longer-term problem: attackers who are collecting sensitive, encrypted data now in the hope that they’ll be able to unlock it at some point in the future. This future threat comes from quantum computers, which work very differently from the classical computers we use today. Their complexity could allow them to break many of the encryption algorithms currently used to protect sensitive data such as personal, trade, and state secrets. Officials are trying to develop and deploy new encryption algorithms to protect secrets against this emerging threat. That includes the Department of Homeland Security, which recently released a road map for the transition towards what is known as post-quantum cryptography.

A cryostat at Google’s quantum computing lab near Santa Barbara, California designed to keep a quantum chip at temperatures close to absolute zero. Photograph: Jason Koxvold

Annual Report to Congress: Military and Security Developments Involving the People’s Republic of China On November 3, 2021, the Department of Defense released its annual report to Congress on military and security developments involving China. The report provides a baseline assessment of the department’s top pacing challenge and charts the maturation of the People’s Liberation Army and China’s evolving national power. The report concludes that China’s national strategy aims to “match or surpass U.S. global influence and power” and “revise the international order to be more advantageous to Beijing’s authoritarian system and national interests.” Notably, China’s nuclear arsenal is estimated to at least double within the decade, significantly outpacing the size the department projected in 2020. The report also highlighted the rapid growth of China’s ballistic missiles capabilities and its aggressive coercive actions against Taiwan and rival claimants in territorial disputes. 

One Belt, One Road (part of Chapter Four: The PLA’s Growing Global Presence) First announced in 2013, the PRC’s OBOR initiative is a signature foreign and economic policy advanced by Xi Jinping. Beijing uses OBOR to support its strategy of national rejuvenation by seeking to expand global transportation and trade linkages to support its development and deepen its economic integration with nations along its periphery and beyond. The PRC implements OBOR by financing, constructing, and developing transportation infrastructure, natural gas pipelines, hydropower projects, digital connectivity, and technology and industrial parks worldwide. PRC leaders have touted the economic benefits of OBOR and invited foreign partners to join, promising wealth and prosperity to those nations that participate. Since its creation, as many as 140 countries have signed OBOR cooperation documents, up from 125 countries from last year. OBOR-related spending is difficult to estimate because there is no comprehensive list of projects. However, public reporting indicates a steady decline in OBOR lending since its estimated peak in 2016-2017.
In support of its national strategy, the PRC pursues a range of goals through OBOR to include strengthening its territorial integrity, increasing its energy security, and expanding its international influence. Given that the Party views the PRC’s security and development interests as complementary, the PRC leverages OBOR to invest in projects along China’s western and southern periphery to improve stability and diminish threats along its borders. Similarly, OBOR projects associated with pipelines and port construction in Pakistan seek to decrease the PRC’s reliance on transporting energy resources through strategic choke points, such as the Strait of Malacca.
The PRC has continued to advance OBOR during the COVID-19 pandemic, while putting new emphasis on health as an area of engagement. The PRC conducted a virtual ministerial- level meeting in June with 25 other countries to discuss OBOR cooperation in a post–COVID- 19 environment. The PRC has framed much of its pandemic support as part of its Health Silk Road, and offered financing to countries for medical equipment and technology.
The PRC attempts to use the economic influence it accrues through OBOR to encourage participating countries to support Beijing’s priorities and objectives on a range of other matters. The PRC applies military, intelligence, diplomatic, and economic tools to counter perceived threats to OBOR’s long-term viability, although the party-state lacks the expertise necessary to assess comprehensive risks in most OBOR participating countries. China’s leaders have tried to counteract negative perceptions of OBOR to attract potential investors as well as reduce suspicions of Beijing’s intentions. In the wake of domestic and international criticism of OBOR, the PRC has attempted to appear more responsive to partner-country input, and open to wider participation. In April 2019, China hosted leaders from 37 countries and delegates from over 150 countries to the second Belt and Road Forum in Beijing. During the forum, PRC leaders attempted to respond to criticism and concerns over corruption, debt sustainability, environmental effects, and the CCP’s underlying goals associated with OBOR.
As the PRC’s overseas development and security interests expand under OBOR, the CCP has signaled that its overseas military footprint will expand accordingly to protect those interests, which the CCP recognizes may provoke pushback from other states. Some of OBOR’s planned economic corridors would transit regions prone to violence, separatism, armed conflict, and instability, putting OBOR-related projects and PRC citizens working overseas at risk. OBOR activities have also generated local and popular concern about corruption, labor, and environmental issues, contributing to the security challenges. The PRC’s defense and security outreach has sought to extend its ability to project military power to safeguard its overseas interests, including OBOR, by developing closer regional and bilateral counterterrorism cooperation, supporting host-nation security forces, and other means.

CFIUS Probing Tencent’s $1.27B Deal For UK Video Game Co. The Committee on Foreign Investment in the United States has opened an investigation into Tencent’s $1.27 billion acquisition of British video game maker Sumo Group, and the companies hope to receive CFIUS approval before the end of this year.

Source: Cooley

The ODNI Releases Declassified Updated Assessment on the Origins of the Coronavirus  The Office of the Director of National Intelligence (ODNI) released a report on October 29, 2021, updating the Intelligence Community’s previous judgments on the origins of the coronavirus. The Intelligence Community determines in the report that SARS-CoV-2, the virus that causes coronavirus, likely emerged through a “small-scale exposure” arising in Wuhan, China no later than November 2019. While the Intelligence Community remains divided on the exact origins of the coronavirus, they judge that the coronavirus was not developed as a biological weapon and that officials in China did not have foreknowledge of the coronavirus before the initial outbreak.
All intelligence agencies believe two hypotheses are possible: 1) “natural exposure to an infected animal” or 2) “a laboratory-associated incident.”
The agencies say they need more information to develop a more definitive explanation for the origins of the coronavirus. You can read the report here.
Responding to the intelligence report, the Chinese embassy in Washington said in a statement to Reuters news agency: “The US moves of relying on its intelligence apparatus instead of scientists to trace the origins of Covid-19 is a complete political farce. “We have been supporting science-based efforts on origins tracing, and will continue to stay actively engaged. That said, we firmly oppose attempts to politicise this issue.”

The 2021 Economic Scorecard: How China stacks up with the US and its allies Eight months ago, Rhodium and our GeoEconomics Center joined forces to answer a burning question: Is China’s economy becoming more or less like those of the United States and other open-market countries? Their first annual report to quantify how the Chinese economy stacks up against other top economies on market competition, investment openness, and more has been turning heads in Washington, Europe, and even inside China. 

China’s Sweeping Crackdowns On October 26, 2021, the Jamestown Foundation held a webinar event, “Assessing China’s Sweeping Crackdowns: Private Enterprise and Media.” Over the past year, the Chinese government has launched a series of widening crackdowns targeting huge swathes of the economy and society. Two groups that have been specifically targeted are entrepreneurs and private media. Under the rubric of “Common Prosperity”, a Mao-era slogan resuscitated by General Secretary Xi Jinping, China has launched a wealth redistribution drive that seeks to reduce yawning economic inequality through tax increases, fiscal transfers, and  pressure on private companies such as Alibaba and Tencent to fund state-affiliated poverty alleviation initiatives. In addition, many once powerful entrepreneurs, such as Ren Zhiqiang and Whitney Duan, have either been imprisoned on corruption charges, or have simply disappeared. The recent crackdown has also extended to journalistic and social media corporations. Earlier this month, the Chinese government announced new plans to bar private investment in domestic media. The ban could have a major impact on private media outlets such as Caixin and Guancha, and will further entrench the Communist Party’s dominance over China’s media environment. Watch the video.

Protecting Against National Security Threats to the Communications Supply Chain Through FCC Programs The Federal Communications Commission was created for many reasons, including for the purpose of national defense and promoting safety of life and property through the use of wire and radio communication. The Commission has taken a number of actions to protect the national security of the United States, or the security and safety of United States persons, and the integrity of communications networks or the communications supply chain. The Commission has also implemented the Secure and Trusted Communications Networks Act of 2019. Section 1.50002 of the Commission’s rules directs the Public Safety and Homeland Security Bureau to publish a list of communications equipment and services (Covered List) that are deemed to pose an unacceptable risk to the national security of the United States or the security and safety of United States persons, based exclusively on any of four sources for such a determination and that such equipment or services possess certain capabilities as enumerated in section 2(a) of the Secure and Trusted Communications Networks Act of 2019, Pub. L. No. 116-124, 133 Stat. 158 (2020) (codified as amended at 47 U.S.C. §§ 1601–1609).

Only a handful of companies are on the list. Given what we know about entities affiliated with the People’s Republic of China, others could be added. It’s not a list any company wants to be on (…).

Four New Reports on National Security Risks Posed by Climate Change On Oct. 21, 2021, the Biden administration released four reports analyzing the threat climate change poses to national security and its role in driving migration. Together, the reports reflect concerns over the potential for climate change to exacerbate political instability and offer opportunities to rival states, such as China. The new Office of the Director of National Intelligence’s National Intelligence Estimate on climate change found that the intelligence community sees three broad categories of risk: rising geopolitical tension as countries argue how to address climate change and how quickly; exacerbation of cross-border geopolitical flashpoints as states take steps to secure their interests; and intensifying physical effects of climate change increasing instability and internal conflict in developing countries. The report identified 11 countries and 2 regions at particular risk but said that no country would be spared from consequences related to climate change. The Department of Defense’s Climate Risk Assessment focused on the military challenges brought on by climate change, the Department of Homeland Security gave a “strategic framework” guiding the department’s policies to address climate change through five lines of effort, which includes plans for “empower individuals and communities to build climate resilience” and “build readiness to respond to increases in climate-driven emergencies”, and the White House detailed how climate change is fueling migration, marking the first time the U.S. government has officially recognized this linkage.

Powering Innovation: A Strategic Approach to America’s Advanced Battery Technology In a new report, Hudson experts examine the race for advanced batteries and the national security risks posed by China’s dominance of the global battery supply chain. The authors offer a four-part national strategy to establish an agile and innovative production base for these critical technologies.

                     PreScouter (via Solar Power World)

Excerpts from the new report (edited for length and clarity):

Energy Supply Chains Are a Major Vulnerability for the US Military / Over the past decade, policymakers have shifted their attention from the Middle East toward East Asia. Although the geopolitical environment has changed, the energy supply chain remains a major source of vulnerability for the U.S. military. Unfavorable geography in the Pacific means that resupplying U.S. forces during a conflict would be both complicated and dangerous. Department of Defense (DOD) officials sometimes refer to this challenge as the “tyranny of distance.” To solve these dilemmas, DOD strategists are developing operational concepts for completing missions in decentralized, more agile formations that can operate far from supply lines. The U.S. military’s shift toward distributed operations—coupled with operational and strategic demands for stealthier vehicles, survivable unmanned systems, electromagnetic warfare-enabled information dominance, and additional satellites—mean that DOD must prioritize continued development and access to advanced batteries.
China’s Weaponization of the World’s Critical Mineral SupplyThe United States controls only a tiny fraction of the advanced battery supply chain. China dominates much of the mining and processing of critical minerals as well as cell manufacturing and battery assembly. These bottlenecks grant Beijing significant strategic leverage: given the Chinese Communist Party’s (CCP) penchant for economic coercion, it is not difficult to imagine how China could weaponize the battery supply chain against the United States. The case of rare earths is just one example of the CCP’s exercise of economic coercion to achieve its strategic goals. In 2019, Beijing issued veiled threats that it may cut off rare earths supplies to the United States if the Trump administration continued to clamp down on Chinese high technology. These threats have grown even more acute under the Biden administration: in spring 2021, Beijing threatened again to cut off rare earths imports to the United States. China’s consolidation of the advanced battery supply chain grants the CCP ample leverage should it continue this strategy.

Four Steps to Secure America’s Energy Supply Chain According to the Hudson Institute, U.S. policymakers should adopt a four-part strategy to create a secure, domestic-oriented supply chain for advanced batteries:

First, the United States should use available policy tools to make investments in mining, processing, and battery production, as well as battery recycling.
Second, policymakers should deploy tools that drive innovation in substitutes for Chinese-controlled critical minerals, next-generation battery technologies, and manufacturing techniques for lithium-ion batteries in order to leapfrog Chinese suppliers.
Third, the Pentagon should undertake a full review of its battery supply chain with an eye toward using DOD-specific policy tools that strengthen the industrial base for military batteries.
Fourth, the U.S. government should invest in workforce development and talent programs across the supply chain.

‘We are so divided now’: how China controls thought and speech beyond its borders The arrest of a Tibetan New York city cop on spying charges plays into the community’s long-held suspicions that the People’s Republic is watching them, according to a new article in The Guardian. It was a pleasant, breezy day in late September 2020 when the FBI showed up outside the home of a man named Baimadajie Angwang. Angwang, who lived in Long Island with his wife and two-year-old daughter, was a community liaison officer with the New York police department, where his role was to build relations with the neighborhood in the 111th precinct in Queens. He had arrived in the US in 2005, a 17-year-old asylum-seeker from a Tibetan enclave in China. He joined the marines in 2009 and served one tour in Afghanistan. And then, in 2019, he showed up at the Tibetan Community Center in Queens. He wanted to be part of the community, Angwang told people. He was there to help Tibetan immigrant youth. He was also, according to the charges against him, in regular contact with two members of the Chinese consulate. “Let them know,” he had told a consular official in November 2018, “that you have recruited someone in the police department.” Certainly, if he was a spy, as charged, he wasn’t a very good one. According to the documents that outline the charges against him, he contacted consular officials on his personal mobile phone, placing calls while FBI officials were listening in. In the recordings released to the court, Angwang flatters and brags. “I’m thinking, the whole world is promoting diversity,” he tells a man referred to as PRC OFFICIAL-2, suggesting they approach minority groups in the Tibetan community to recruit informants. Angwang tries to convince the official to get him a visa to go back and visit China. Other informants will want them, he says. They will think the PRC doesn’t appreciate them. Especially, he says, the “100%-type” – the real believers. “It is hard to find people like us,” he complains. “So enthusiastic.” Enthusiasm aside, Angwang seemed to have little real intelligence to offer. The charges filed shortly before he was taken into custody testify to his relatively lowly status. He is facing allegations of wire fraud, making false statements and of acting as an unregistered foreign agent: a section of the US criminal code widely known as “espionage light”. Of the many questions raised by Angwang’s case, perhaps the most striking is why the Chinese consulate would have bothered talking to him at all.

The Mosaic Approach: a Multidimensional Strategy for Strengthening America’s Critical Minerals Supply Chain The United States faces a troubling scenario when it comes to the supply chain for critical minerals. Rapidly increasing demand, under-developed national resources, intense international competition, and years of neglect in this issue area place the U.S. at a distinct disadvantage vis-à-vis China in securing access to the metals and Rare Earth Elements that are vital for the energy transition and for geopolitical ambitions. The Wilson Center Supply Chain Initiative launched a paper that reflects the dialogue sustained by a high-level group of stakeholders in the summer of 2021 and argues that the United States must take a number of key steps to make the critical minerals supply chain more resilient.

Source: The United States Geological Survey (USGS)

Hostage diplomacy is back. It requires a forceful response As the release of Huawei’s Meng Wanzhou represents, hostage diplomacy is back, and it requires a forceful response, argues the author, a distinguished senior fellow in foreign and defense policy studies at the American Enterprise Institute (AEI). Right now, the Department of State warns Americans not to travel to Iran due to the risk of kidnapping and arbitrary arrest and to reconsider travel to China due to arbitrary enforcement of local laws. But those warnings are clearly insufficient. If China, Iran, and others view American citizens as pawns to be taken in exchange for policy or political concessions or for human exchanges, it’s time to deny them that option. Read more in AEI’s Op-Ed of October 5, 2021.

Beijing Changes Its Approach to Economic Expansion in Central Asia China has quietly but dramatically changed its economic approach to the countries of Central Asia—a shift with enormous consequences not only for the region but for Beijing’s relationship with Moscow. Until recently, China had provided loans to the countries of the region to build railway routes across Central Asia as part of its Belt and Road Initiative. These routes linked China with Europe, bypassing the Russian Federation. Now, it has largely ended such projects and, instead, is investing heavily in manufacturing firms in Central Asia. On the one hand, this suggests that China may now plan to use Russian routes more heavily, at least in the short term, something Moscow will certainly welcome. But on the other hand, it means that the Central Asian countries are likely to become both more economically independent of Russia and more closely integrated into China’s growing economic empire, an outcome that will further diminish Moscow’s influence in the region and could even reduce the willingness of Central Asians to move to Russia as migrant workers. Neither of these effects is likely to please the Kremlin. This shift appears to be less the result of any new Chinese calculation than of Beijing’s recognition that its earlier approach had intensified protests and anti-Beijing attitudes among Central Asian populations—however popular it may have been with some Central Asian elites. More in this EDM publication (Volume: 18 Issue: 164)

China’s Rapid Economic and Cultural Expansion in Georgia Troubles Some in Tbilisi At a time when the efforts of Russia, Turkey and Iran to expand their influence in the South Caucasus have received attention internationally, the ongoing moves by China to solidify its role in Georgia have slid under the radar. Nonetheless, Georgia promises to give Beijing an important bridge to Europe as well as the means to increase its geopolitical influence in the Caucasus more generally. Indeed, Beijing’s quiet approach in Georgia may gradually undermine this pivotal South Caucasus state’s relationship with the West. Furthermore, Chinese activities there may eventually spill over to building up Beijing’s role in resolving the Karabakh conflict and aid in the reopening of long-blocked transportation routes across the region. Yet as China moves to increase its influence economically, culturally and politically, ever more Georgians are concerned about Beijing’s muscular approach. And some of them fear that this development could threaten both Tbilisi’s pursuit of membership in key Western institutions and jeopardize its ability to act independently on the international scene. These worries are now strong enough to constitute yet another factor in the political crisis Georgia currently finds itself in: one side is convinced China is providing a level of assistance that no other outside power is prepared to give, while the other argues that precisely because of its assistance, Beijing now represents a threat Tbilisi cannot afford to ignore, however profitable the relationship has been up to now. China began pursuing a special relationship with Georgia in 1993, offering investments, trade and educational exchanges.

The Chinese Hualing Group has transformed a district in the north of the city, building a new town. Photograph: George Gouge

The Chinese effort first peaked in 2018 with the establishment of a free trade zone between the two countries and the opening of two Confucius Institutes in Tbilisi. These were accompanied by plans, put on hold by the COVID-19 pandemic, to offer Chinese as a foreign language in some Georgian schools as well as scholarships for Georgian students to study in Chinese universities, a program that has gone ahead despite the coronavirus. More in the October 7, 2021 issue of Jamestown’s Eurasia Daily Monitor (volume 18, issue 153).

Microsoft’s annual Digital Defense Report Introduction: “2021 brought powerful reminders that to protect the future we must understand the threats of the present. This requires that we continually share data and insights in new ways. Certain types of attacks have escalated as cybercriminals change tactics, leveraging current events to take advantage of vulnerable targets and advance their activity through new channels. Change brings opportunity—for both attackers and defenders—and this report will focus on the threats that are most novel and relevant to the community as we look to the months ahead. Looking at the threat landscape, along with data and signals from cross-company teams, five top- level areas emerged as most critical to bring into the sharpest focus in this report: the state of cybercrime; nation state threats; supplier ecosystems, Internet of Things (IoT), and operational technology (OT) security; the hybrid workforce; and disinformation. To provide the greatest benefit, we also extract our recommendations and actionable learnings, and present them throughout the report and in our concluding chapter”.

The new CIA China Mission Center (CMC) The Central Intelligence Agency announced the formation of a new China Mission Center on Thursday, underscoring the Biden administration’s focus on Beijing as a top foreign policy priority and a formidable global competitor to the United States. In a statement that referred to the Chinese government as a “key rival,” the CIA said the mission center was the result of a series of strategic reviews launched by Director William Burns in the spring that concentrated on “China, technology, people, and partnerships,” among other areas. The mission center is intended to “address the global challenge posed by the People’s Republic of China that cuts across all of the Agency’s mission areas,” the CIA said, with Burns adding that it “will further strengthen our collective work on the most important geopolitical threat we face in the 21st century, an increasingly adversarial Chinese government.” Read the full article from POLITICO.
The China Mission Center is part of agency wide pivot towards China, with Burns citing an “increasingly adversarial Chinese government” in his announcement. The China Mission Center will bring together case officers who recruit spies, intelligence analysts, technology experts and other specialists in a single unit. The spy agency will also recruit and train more Mandarin speakers and deploy China specialists around the world, reflecting the global nature of U.S.-China competition, a senior Central Intelligence Agency official said,” according to the Wall Street Journal (subscription needed).
In an October 7, 2021 press release from the agency, CIA Director William J. Burns announced adjustments to CIA’s organizational structure and approach to best position it to address current and future national security challenges.  These changes resulted from the strategic reviews Director Burns launched this past spring that focused on areas including China, technology, people, and partnerships. Director Burns announced the formation of a China Mission Center (CMC) to address the global challenge posed by the People’s Republic of China that cuts across all of the Agency’s mission areas.  Emphasizing that the threat is from the Chinese government, not its people, Director Burns explained that the new mission center will bring a whole-of-Agency response and unify the exceptional work CIA is already doing against this key rival.  “CMC will further strengthen our collective work on the most important geopolitical threat we face in the 21st century, an increasingly adversarial Chinese government,” Director Burns said.

Japan Increasingly Focused on Taiwan Security According to a recent commentary in Lawfare, Japan continues to take steps in response to the tense situation in the Taiwan Strait.

Gallo Images | Getty Images

Following its joint statement with the United States in April calling for “peace and stability across the Taiwan Strait” and “the peaceful resolution of cross-Strait issues,” Japan announced plans to station anti-aircraft and anti-ship missiles, as well as hundreds of troops, on Ishigaki Island, approximately 300 kilometers from Taiwan, by March 2023. This deployment would make Ishikagi the fourth missile-armed island in Japan’s southern Ryukyu island chain. As reported by Nikkei Asia, this announcement follows “unprecedented statements in recent months by [Japanese Defense Minister Nobuo Kishi] and other Japanese officials about the need to defend Taiwan in the event of a Chinese attack, and publicly linking Taiwan’s security to Japan’s own.” In June, for instance, Japanese Deputy Defense Minister Yasuhide Nakayama argued that the world needed to “wake up” to China’s pressure campaign against Taiwan and “protect Taiwan as a democratic country.” These announcements come as Japan plans to revise its Medium-Term Defense Program earlier than scheduled “as it looks to boost spending to counter China’s growing assertiveness in surrounding waters and prepare for contingencies in the Taiwan Strait.” In a further indication of deepening ties between Japan and Taiwan, on Aug. 27, the ruling parties of the two nations held their first bilateral security talks, which “are a substitute for ministerial talks since Japan and Taiwan do not have diplomatic relations.” These talks come shortly after China launched a live-fire assault drill in the vicinity of Taiwan “as a direct response to the recent collusion and provocations made by the US and the Taiwan secessionists.” According to a spokesperson for the People’s Liberation Army Eastern Theater Command, this drill included warships, anti-submarine aircrafts, and fighter jets “to test integrated operational capability” in territory southwest and southeast of Taiwan. Japan has also been working with the United States to conduct war games and joint military exercises preparing for a conflict between China and Taiwan, and a recent survey of Americans shows that for the first time more than half of Americans (52 percent) are in favor of using U.S. troops to defend Taiwan were China to invade.

Chinese State Capitalism: Diagnosis and Prognosis  How should China’s economy be described? Is it capitalist, socialist, command and control, or a mixture of all three? More than four decades after the post-Mao Zedong leadership launched their economic reforms, the precise nature of the country’s economy and the political orientation of the institutions that govern it remain subject to debate. The CSIS Trustee Chair in Chinese Business and Economics and the CSIS Freeman Chair in Chinese Studies convened some of the world’s leading experts on China’s political economy for a two-day workshop in March 2021, from which the essays in this volume emerged. The views expressed in these pages are far from unified, either in their diagnosis of what precisely China’s state capitalist system is or in their prognosis for how the United States and other market economies should respond. One area of consensus throughout this edited volume, however, is that the CCP wields expanding de facto and de jure power over nearly all areas of political and economic activity in China. It is this feature of China’s state capitalist system—the expansive and expanding role of the CCP—that poses the most significant challenges not only in how the workings and structure of China’s economy are understood, but also in how market economies can and should respond. This volume does not conclusively resolve this critical dilemma, but the authors hope that it can help further a much-needed discussion with careful and considered analysis. This report was made possible by the generous support of the Semiconductor Industry Association and general support to CSIS.

The Chipmakers Technical leadership in the semiconductor industry has been a cornerstone of U.S. military and economic power for decades, but continued competitiveness is not guaranteed. This CSET issue brief exploring the composition of the workforce bolstering U.S. leadership in the semiconductor industry concludes that immigration restrictions are directly at odds with U.S. efforts to secure its supply chains.

Harvard Beijing Academy’s Move to Taipei Starting next summer, the Harvard Beijing Academy study abroad program will move from the Beijing Language and Culture University to National Taiwan University. According to Harvard’s Program Director, the move to Taipei came in response to “a lack of friendliness from their Chinese host institution.” In recent years, Harvard has had difficulty getting classrooms and dorms, which forced the program to split students into two different dorms or to find a hotel to keep students together. “Given the conditions they provided, we really couldn’t run the program with the quality that we are hoping to deliver to our students,” the Program Director said. In past years, on July 4th students and faculty would gather to eat pizza and sing the national anthem. But, in 2019, the university cancelled the gathering. “We were told that our students were not allowed to sing, to celebrate,” the Program Director said. More in The Harvard Crimson.

Succeeding Xi Jinping Does Xi Jinping’s China face a looming succession crisis? Some analysts argue that it does because Xi’s elimination of the term limit on his leadership position and the concentration of power therein would precipitate such a crisis. Others are more skeptical, pointing out that the political significance of Xi’s moves is exaggerated. The ultimate benchmark of any succession crisis is whether the military gets involved. Consequently, examining the possible role of the People’s Liberation Army in China’s leadership succession may help us to understand whether a crisis is looming. Since the Communist Party came to power in 1949, two critical instances stand out in China when the military became heavily involved in domestic politics, including in leadership successions. The People’s Liberation Army played a crucial role in the Cultural Revolution (1966 to 1976) under Mao Zedong. It also massively intervened to quell the popular rebellion in 1989 under Deng Xiaoping. Certain institutional conditions incentivized the involvement of the military in domestic politics in those instances. The first was the “symbiotic” relations between the Communist Party and the army. Top leaders such as Mao and Deng possessed extensive and entrenched personal networks or factions within the People’s Liberation Army, and they counted on them for support in political crises. The second condition was the civilian governance failures that caused severe political divisions among the ruling civilian elite. The ensuing political crises drove the top leaders to mobilize the military to intervene. China is not now facing a succession crisis because the military is unlikely to intervene in deciding who replaces Xi whenever he leaves office. More effective civilian governance in China since Deng has disincentivized the military from intervening in elite politics. Moreover, senior party leaders no longer enjoy the deep personal networks within the People’s Liberation Army that would allow them to use the army for their own domestic political purposes. Xi’s successor will likely come from the ranks of the Politburo Standing Committee Members, and will be approved by the Chinese Communist Party Central Committee through voting. Simply put, it will be a big deal when Xi leaves office, but it won’t be a crisis. More in this War on the Rocks article.

Getting Smart About Smart Cities This CNAS policy brief examines some of the systemic vulnerabilities that facilitate misuse of smart city technology by governments and provides snapshots of cities across the Indo-Pacific that have managed these vulnerabilities to successfully implement smart technology within the precepts of a liberal digital order. It then offers guiding principles for policymakers in Washington to further facilitate the growth of responsible smart city development in the Indo-Pacific. More smart cities are coming, and those that are already here will continue to grow more technologically advanced. What that means for the state of Indo-Pacific digital governance in five, 10, and 50 years depends on the foundation laid by policymakers today while the concept of smart cities is still new.

China Pathfinder China Pathfinder is a new initiative from the Atlantic Council’s GeoEconomics Center and Rhodium Group that seeks to measure China’s system relative to advanced market economies. The goal is to shed light on whether China’s economic system is converging with, or diverging from, leading open market economies. In their inaugural report they examine six elements of the market economy model: financial system development; market competition; modern innovation system; trade openness; direct investment openness; and portfolio investment openness. With the launch of this annual scorecard, and subsequent quarterly updates, China Pathfinder aims to put recent developments like the crackdown on private technology companies, Beijing’s “dual circulation” strategy, and the debate over “common prosperity” into a broader framework to help policymakers and businesses assess China’s economic trajectory.

Justice Department IG Releases Audit of FISA Procedures On Sept. 30, 2021, the Department of Justice’s inspector general released an internal audit of the FBI’s procedures around the Foreign Intelligence Surveillance Act (FISA) application process. The FBI’s “Woods Procedures” are one element of the FISA application process in which FBI personnel must “document support for all factual assertions contained in [the applications].” Of an initial sample of 29 FISA applications, the audit found more than 400 instances of non-compliance with Woods Procedures. An additional review of more than 7,000 FISA applications authorized between January 2015 and March 2020 found at least 179 instances in which the required Woods file was missing in whole or in part. The report contains 10 recommendations to the FBI and National Security Division of the Justice Department to better execute the Woods Procedures and ensure accurate submissions of FISA applications. You can read the audit here. See also “The FBI’s FISA Mess”, an article written by the executive editor of Lawfare (and deputy general counsel of the Lawfare Institute), together with the editor in chief of Lawfare (and a Senior Fellow in Governance Studies at the Brookings Institution). 

CSET Legislation Tracker The CSET Legislation Tracker serves as a resource to identify and monitor federal legislation related to emerging technology and national security. In addition to widely covered bills, members of Congress have introduced proposals to secure the U.S. research enterprise, bolster domestic semiconductor production capacity, promote technology alliances with like-minded partners and improve STEM workforce development. This tracker catalogues legislation on topics within CSET’s key areas of inquiry and relevant to U.S. science and technology leadership. Each piece of legislation is represented as a card. Each card includes the bill’s title, sponsor, number of cosponsors and committee of jurisdiction. The panel on the right displays the CSET research topic within which the bill falls and the bill’s current status. At the top of the tracker, users will find pinned cards highlighting specific bills that we deem significant based on widespread media coverage or notable movement through the legislative process.

The Security Implications of Chinese Infrastructure Investment in Europe Even before the Belt and Road Initiative (BRI) provided additional clarity about China’s strategic intent, Europe had experienced major influxes of Chinese finance, used to snap up everything from fading brands to large-scale infrastructure assets. The EU and many European states have already expedited their plans to strengthen or launch investment-screening processes. Yet Europe is still in the early stages of determining the right balance of security, openness, and economic resilience when it comes to China’s economic presence. Many investment-screening mechanisms are new or untested. Debates over how far strategic infrastructure should be viewed through a military security prism continue apace in NATO. China’s “dual circulation” plans for its domestic economy, which signal a more radical approach to self-sufficiency for itself and dependency for others, are still in their embryonic phase, as is European thinking about how to adjust policy in light of it. Through the analysis of three emblematic case studies, this GMF report takes stock of the situation and highlights commonalities in Beijing’s approach to infrastructure investment in Europe.
The first case is Germany and its neighbors. Germany remains the economic locus for much of the wider region, and is the dominant actor for the European economy as a whole, which gives outsized weight to national and sub-national choices in the country about how to deal with Chinese economic actors (see also this German report from the “Stiftung Wissenschaft und Politik”). While specific industrial sectors continue to deepen their commercial ties, concern from important sections of industry about the systemic impact of Chinese economic and political practices has arguably had the single greatest impact on the changing nature of the European debate on China.

A freight train leaves for Duisburg from Weihai port in Rongcheng, China. Duisburg is host to the world’s largest inland port, with 80% of trains from China now making it their first European stop. Photograph: VCG/Getty Images

The second case is Italy and the wider Mediterranean region. Southern Europe was the locus of the biggest wave of Chinese investments in sensitive sectors during the eurozone crisis. Many saw Italy’s willingness to sign up to the BRI in 2019 as simply a repeat of the Greek and Portuguese experience earlier. Yet, the picture has proved vastly more complex. Membership of BRI, far from resulting in a deepening of Sino-Italian relations saw a diplomatic backlash produced by the BRI memorandum of understanding and the end of the populist coalition government, formed by the Five Star Movement and the League, that signed it.
The third chapter moves to the Nordic countries. The crux of the recent story there too is the change in approach from some of Europe’s most open and technologically advanced states, which have shifted from seeing China through the prism of globalization’s benefits to revisiting the permeability of their systems in light of the risks that it poses.
The coming phase of Chinese infrastructure investment in Europe will not resemble the previous ones. Beijing is well aware of the changed political climate in many countries, of the heightened sensitivities around these investments, of the greater attention from the United States, and of the new scrutiny mechanisms that are in place.
Nonetheless, European analysis and responses to China has often been characterized by a “rearview mirror” approach. In drawing lessons from the case studies, the main question to address is how to ensure that the substance of the security concerns relating to Chinese investment is addressed rather than just the specific forms it has taken in the past. The German Marshall Fund of the United States (GMF), founded in 1972 and based in Washington, DC, is a non-partisan American public policy think tank and grantmaking institution dedicated to promoting cooperation and understanding between North America and Europe. The “Stiftung Wissenschaft und Politik” (the German Institute for International and Security Affairs) advises the German government and parliament on questions of foreign and security policy. They are one of Europe’s largest foreign policy think-tanks, conducting independent, practice-driven research.

The Neglected Agency at the Center of Biden’s China Strategy U.S. Trade Representative Katherine Tai called out China’s “lack of adherence to global trading norms” and vowed that the United States would respond by developing trade policies that protect U.S. markets against unfair economic practices and benefit American workers. The speech is one of the clearest examples thus far of the Biden administration’s intent to compete with China by countering its anti-competitive economic methods, which have flouted free-market rules, distorted the global market and involved wholesale theft of American technology and know-how. Tai made it clear that economic tools like tariffs and export controls are central to the administration’s approach. Yet the government agency most critical to these efforts still lacks the resources and authorities it needs to accomplish its mission. The authors (a senior fellow and director of the technology and national security program at the Center for a New American Security (CNAS) and a research associate with the CNAS technology and national security program) are talking about the Department of Commerce. As America’s national security becomes intertwined with its economic strength and technological leadership, Commerce has an increasingly central role in protecting U.S. technology advantages, addressing supply chain vulnerabilities and ensuring long-term economic competitiveness. The Commerce Department’s role and responsibilities have grown in size and complexity, while its capabilities and resources have not. This shift reflects the nature of the competition with China (and one of the reasons the analogy to a “new Cold War” is flawed): Economic security and advantages in non-military technology have outsize importance compared to traditional military strength. That’s still crucial, of course, but much of the day-to-day contest happens in the arena of commerce. Just as other departments, like Treasury and Homeland Security, have been revamped and restructured as their relevance to national security grew, the Biden administration needs to reform the Commerce Department’s resources, structure and authorities if its China strategy is to succeed. Read the full article from POLITICO.

As China stumbles, the West must ask: what if its rise is not inevitable Today, China’s Evergrande – the world’s most indebted property developer with $300bn of liabilities – is on the verge of a default as Beijing tightens rules on leverage and the country’s long real estate boom tilts towards bust. As the China expert George Magnus wrote on, the firm’s unravelling could send a shock through the financial system of a country that has “never experienced a meaningful decline in property prices”. The crackdown on technology giants such as Alibaba and Tencent, also part of Xi’s war on excess, has wiped more than $1trn combined off tech firms’ stock prices and spooked investors. China’s marriage of market economics and political Leninism appears to be faltering. Rolling power cuts in recent weeks have prompted coal production to be ramped up, demonstrating the awesome scale of the challenge of decarbonizing the Chinese economy. Combined with new outbreaks of the Delta Covid variant leading to local lockdowns, the energy crisis is slowing the economy. Manufacturing activity contracted in September. Then there is that other long-term threat to Chinese prosperity: its rapidly ageing population. A census published in May showed China’s birth rate had dropped to 1.3 children per woman (compared with 1.6 in the US), while a new study by medical journal the Lancet projects that China’s population will halve by 2100. These challenges all suggest that China has not managed to reconcile prosperity and authoritarianism as smoothly as the bullish accounts of its ascent suggest. Unfashionably bearish books that have warned about China’s future – Magnus’s Red Flags and Carl Minzer’s End of an Era – are now looking strikingly prescient. More in the New Statesman article, published on October 6, 2021.

The Belt and Road Initiative and the Internationalization of China’s Scientific Power: The Case of Italy What are the elements and the impact of the inclusion of scientific cooperation within the 2019 Memorandum of Understanding (MoU) in support of the Belt and Road Initiative between Italy and China? Like many other developed countries, Italy has played a role in contributing to China’s growth as a science and technology (S&T) power. Most S&T bilateral collaborations are decade-long and predate the MoU, suggesting that the importance of the latter is largely symbolic. Nonetheless, the MoU of March 2019 has reinforced the process of centralization of S&T collaborations as well as a public debate that has grown to include matters regarding 5G technology and public procurement involving Chinese technology. This IAI paper is also part of the Istituto Affari Internazionali’s project “When Italy Embraces the BRI”.

The West has handed China the world on a platter Only Covid and the energy crisis have awoken our policymakers to the threats posed by Beijing’s belligerence, according to this article in The Telegraph.

One Belt One Voice: Chinese Media in Italy Chinese media are the voice of the Chinese Communist Party at home and abroad. It is no surprise therefore that collaborations between Chinese and foreign media have been attracting more international attention. One issue that has not been yet explored is the nature and implications of the inclusion of two important Italian media actors such as Rai (the state-run broadcasting company) and Ansa (Italy’s main press agency) in the Memorandum of Understanding signed by Italy in support of the Belt and Road Initiative in 2019. These deals fit in a broader picture of an Italian media environment that is being increasingly targeted by Chinese media. However, the impact that such an effort has had on the Italian public opinion has been very limited so far and the Italian media landscape keeps offering free and varied information. This IAI* paper is part of the Istituto Affari Internazionali’s project “When Italy Embraces the BRI”. The Istituto Affari Internazionali isprivate, independent non-profit think tank, founded in 1965, and based in Rome, Italy.

Escalation in the Taiwan Strait: What to Expect from Europe? Over the last few years, tensions in the Taiwan Strait have led to great concerns over Chinese territorial claims in the region. The potential for an escalation is high – with significant implications for Europe. At the same time, the Biden administration is pursuing a tough stance on China and expects Europe to join a transatlantic approach. Against this backdrop, Körber-Stiftung, in cooperation with the Chatham House Asia-Pacific Programme, brought together a high-level group of senior experts, politicians, and officials from France, Germany, Italy and the UK to address a fictional scenario of a political security crisis in the Taiwan Strait. The recently published Körber Policy Game scenario report summarises the results of these discussions and offers policy recommendations. Körber-Stiftung’s report is here.

How China took Western tech firms hostage In a recent scene straight out of a spy thriller, a powerful man, speaking under obvious duress, pleaded with the leaders of his country to comply with the demands of the organization that had him in its grip. Although it recalled the 1970s scenes of Italian Prime Minister Aldo Moro pleading from Red Brigade captivity and Hanns Martin Schleyer, the president of the German employer federation, after being kidnapped by the Baader-Meinhof Gang, in this case it was actually Börje Ekholm, the CEO of the Swedish firm Ericsson, and his captivity was not physical. Under pressure from Beijing over Ericsson’s home government’s banning of some Chinese telecoms technologies, he feared for the future of his business. His is not an unusual case. In today’s global trade competition, companies are becoming easy prey for hostile governments. Their home governments and citizens should back them up. Ekholm’s tale, which emerged in Swedish media over the holidays, was a painful one. Earlier, he had sent text messages to the country’s trade minister, Anna Hallberg, bewailing Sweden’s decision earlier in 2020 to ban Huawei and the smaller Chinese firm ZTE from its 5G telecommunications network. The ban hadn’t been Hallberg’s doing; the decision was made by an independent government agency, the Post and Telecom Authority. Ekholm, however, was looking to send a message through her to that bureau. “At the moment Sweden is a really bad country for Ericsson,” he told the minister, implying that Stockholm had let his firm—synonymous with Sweden in much the same way as Ikea, Saab, and the now Chinese-owned Volvo are—down. Unfortunately, Ekholm forgot about Sweden’s transparency laws, which mean all communication sent to the government is public. Journalists found his text messages and published them, to widespread outrage that Ekholm would do Huawei’s bidding.
Indeed, why on earth would the CEO of Ericsson, one of Huawei’s two top competitors, beg his government to reverse a decision that clearly favors his firm? Although his texts made news, Ekholm had even said much the same in newspaper interviews (including one with the Financial Times): Sweden should reverse its Huawei ban. The reason, of course, is that Ericsson sells products in China, too. In 2019, for example, China’s top three telecommunications operators—China Mobile, China Unicom, and China Telecom—signed agreements with Ericsson to use its tech. The same year, the Swedish firm opened a smart factory in China, where part of its manufacturing takes place, and much of Ericsson’s sales growth that year came from Chinese markets. More in AEI’s article.

Unclassified Summary of Assessment on COVID-19 Origins During a closed-door intelligence briefing, Republican lawmakers sought to expose what they believe is bias against the Wuhan lab leak theory among experts consulted by President Biden’s administration in its investigation* into the origins of Covid-19, sources have said. Frustrations boiled over at the briefing, according to sources. *On August 27, 2021, the Office of the Director of National Intelligence released an unclassified summary of the Intelligence Community assessment on COVID-19 origins. According to the summary, China’s cooperation most likely would be needed to reach a conclusive assessment of the origins of COVID-19. Beijing, however, continues to hinder the global investigation, resist sharing information and blame other countries, including the United States. These actions reflect, in part, China’s government’s own uncertainty about where an investigation could lead as well as its frustration the international community is using the issue to exert political pressure on China.

Banking on the Belt and Road: Insights from a new global dataset of 13,427 Chinese development projects China has provided record amounts of international development finance and established itself as a financier of first resort for many low- and middle-income countries (LMICs) over the last two decades; however, its grant-giving and lending activities remain shrouded in secrecy. Thirty-five percent of infrastructure projects financed through China’s Belt and Road Initiative (BRI) struggle with corruption, labor violations, environmental pollution, and public opposition, according to a Policy Report by AidData. The report introduces a uniquely comprehensive and granular dataset of international development finance from China. It captures 13,427 projects worth $843 billion across 165 countries in every major world region over an 18-year period. AidData is a research lab at William & Mary’s Global Research Institute.

Winning the Geo-Tech Battle and Building the Quad Alliance in the Indo-Pacific Under Xi Jinping, the People’s Republic of China (PRC) has established as its paramount geopolitical objective the replacement of the free and open, rules-based order in Asia with an alternative world order, one that is to be dominated by the interests and values of the Chinese Communist Party (CCP). This decision presents a danger to the entire world, not just to any one state or group of states. For, as US Secretary of State Antony Blinken said at the March 2021 US-PRC meeting in Alaska, the alternative to a rules-based order “is a world in which might makes right and winners take all, and that would be a far more violent and unstable world for all of us.” In furtherance of its objectives, the PRC is in the midst of a large military build-up, but there is much more. For today’s CCP, political power grows not only from the “barrel of the gun,” as Mao Zedong once put it, but also from cutting-edge technologies. Thus, while Beijing pours billions into artificial intelligence and surveillance tech to impose its new “digital totalitarianism” inside the PRC, from Hong Kong to Xinjiang, it is also using its growing technological prowess to press its larger geopolitical agenda in the Indo-Pacific and beyond. It is weaponizing technology and connectivity, along with trade, finance, and other policy instruments to try to rule the key technologies and industries of the future, as well as to improve its strategic positioning and acquire political power over other countries—for instance, through its bid to dominate other nations’ most sensitive data networks, or via the export of its suite of “social stability” technologies, i.e., the “techno-tyrant’s toolkit.”
In all this, the CCP’s intent is to entrench its power and Leninist norms and practices to the extent it can do so beyond the PRC’s borders, and to make other nations, or at the least their ruling elites, beholden to it. 
So in addition to the PRC’s militarily destabilizing activities in the West Pacific and incursions into India’s Himalayas, there is also a “geo-technological front.” If Xi’s CCP succeeds at enmeshing other countries in its expanding “PRC sphere of technological influence,” it could unlock and be able to exploit decisive military, economic, diplomatic, and ideological advantages. The PRC’s many-faceted assault on international order requires a similarly comprehensive and sustained response. Many democratic nations, therefore, have been acting to reimagine and deepen cooperation with one another, including in the geo-tech arena. However, the CCP is aware that the world’s democracies are of many minds about how to respond to it, and the party has always relied on poor coordination among the democracies to advance its aims. Far greater coordinated planning and action—an “alliance of democracies,” as President Biden has called for—will be needed to safeguard and promote democratic leadership over the key technologies and industries of tomorrow, and the ends to which they will be put. In the meantime, the main locus of PRC’s strategic gambits is in Asia, and there, a powerful grouping of Indo-Pacific democracies has emerged to balance against and counter the PRC’s bid for primacy.  This Hudson policy memo examines seven areas of cooperation between members of the Quad alliance that would strengthen a technological environment anchored by democratic values:

  1. Foster a robust democracy-led tech ecosystem in the Indo-Pacific
  2. Create commercially competitive alternatives to PRC 5G
  3. Establish a Quad free and secure digital trade agreement
  4. Coordinate policies to restrict PRC economic involvement in geo-tech and manufacturing competition
  5. Address PRC freeriding and the illegitimate use of innovation on the “global democratic commons”
  6. Establish a Quad innovation fund
  7. Focus on environmental technology

U.S. President Joe Biden hosts a Quad Leaders Summit along with Indian Prime Minister Narendra Modi, Australian Prime Minister Scott Morrison and Japanese Prime Minister Suga Yoshihide in the East Room of the White House on September 24, 2021 in Washington, DC. Sarahbeth Maney / Getty Images

China’s foreign policy at the centennial of the Communist Party: Prestige above all  Communist Party of China (CPC) is celebrating its 100th anniversary. In recent years, China’s foreign policy led by the CPC has been marked by the scrapping of the “one country, two systems” principle in Hong Kong society and the rise of the Chinese representatives abroad who have adopted an aggressive style of presenting their views. This “prestige-driven” foreign policy has proved harmful to the country’s external relations. Currently, China considers the US the biggest obstacle when it comes to boosting its prestige. The latest FIIA Briefing Paper analyses the CPC’s historical narrative and its impact on China’s current foreign policy priorities. According to the author, the fate of the Soviet Union and its leading Party has loomed over the heads of the CPC leaders for almost three decades. The author claims that there might be an easing in Chinese politics once the Party has successfully organized the centennial celebrations and the 20th National Congress in 2022.

CFIUS, Team Telecom and China In the past few years, two federal government interagency committees—the Committee on Foreign Investment in the United States (CFIUS) and Team Telecom—have begun to play an important role in the government’s effort to counter potential threats from Chinese companies’ involvement in the United States. Both committees review certain foreign companies’ American investments. CFIUS has jurisdiction over a broad swathe of foreign investment in the U.S., and Team Telecom’s jurisdiction covers certain licenses for foreign telecommunications companies to operate. Both committees have become more assertive—often retroactively ordering divestiture or revocation against Chinese companies, sometimes years after an investment was completed or a license granted. And notably, both committees seem to be broadly maintaining a similar posture under President Biden as under President Trump. This post reviews both committees’ origins and activities. The Committee on Foreign Investment in the United States is an interagency committee, headed by the Treasury secretary, tasked with reviewing foreign in-bound investments for national security risks. If CFIUS deems a foreign investment a national security threat, it can force the investor to pursue measures to mitigate the risks or recommend that the president prohibit the transaction or order divestiture of a past investment. CFIUS orders or presidential orders on CFIUS’s recommendation are subject only to limited judicial review and the government does not have to produce extensive justifications for its national security recommendations or divestment orders. CFIUS never publicizes its reviews and publishes few details about its internal deliberations or reasoning for specific cases. CFIUS, historically, intervened rarely and focused primarily on investments critical to national security. CFIUS’s few public actions, along with media reports on CFIUS activity over the past five years, yields several trends that are particular to CFIUS, beyond those trends shared with Team Telecom and enumerated above. CFIUS has been particularly aggressive toward in-bound Chinese investment in the semiconductor industry (a long-standing concern) and to investments giving Chinese firms access to Americans’ personal data (a new concern). Moreover, while CFIUS under the Biden administration seems on track to continue Trump-era CFIUS’s aggressive focus on China and technology, Biden’s emerging effort to multilateralize foreign investment screening via intelligence sharing partnerships with allies and coordinated reviews suggests a potential break with Trump. More in this Lawfare article.

China’s hunt for dissidents has gone global For years, China has purported to be a new type of great power: one that rises peacefully and respects the rights of other states rather than chasing the foreign domination of empires past. “China will never seek hegemony, expansion or a sphere of influence,” President Xi Jinping said in April. Yet many of Beijing’s policies have a distinctly imperial feel. A case in point is a wide-ranging effort to give Chinese law enforcement global reach, and thereby hound the regime’s enemies wherever they may go. The programs in question are known as Operation Fox Hunt and Operation Skynet. As ProPublica has reported, their stated purpose is to track down white-collar criminals who have sought refuge abroad. Yet in many cases, the real targets are dissidents or political foes of Xi. Networks of Chinese agents have fanned out across countries around the world, usually without the knowledge of local authorities, to surveil and apprehend wanted individuals, according to the U.S. Justice Department and press reports. They often rely on heavy doses of coercion, reportedly using family members who still live in China — and are thus at the mercy of the Chinese Communist Party — as leverage to bring those individuals home. Chinese officials say that these programs have nabbed more than 8,000 fugitives since 2014. And China’s “fox hunters” are not simply stalking their prey in small, underdeveloped countries with weak law-enforcement capabilities. One unsuccessful operation, involving 19 agents and local accomplices, targeted a Chinese citizen living outside of New York City, according to U.S. authorities. It was not, apparently, an isolated incident. Director Christopher Wray of the Federal Bureau of Investigation has said that “hundreds of the Fox Hunt victims that they target live right here in the United States, and many are American citizens or green card holders.” More in AEI’s recent op-ed.

The UK and China: Next Steps 18 months on from the creation of the China Research Group (CRG), this paper takes stock of three key questions 1) What has changed in the past 18 months? 2) What issues are likely to define our future relationship with China? and 3) What should the UK do now? It looks ahead to the next year, identifying six broad directions in which the CRG believes that the UK should seek to develop stronger domestic policies and international alliances:

  1. Develop and publish a UK-China strategy which sets out a clear framework for engagement, and adapt existing government structures to reflect China’s status as the ‘most significant geopolitical factor’ of the coming decade
  2. Invest in improving the UK’s understanding of China – its people, culture, language, and history to build a better foundation for a sustainable long-term relationship
  3. Improve oversight mechanisms for foreign interference in government, critical national infrastructure, and higher education
  4. Take steps to reconcile our domestic and international resilience strategies and re-evaluate supply chain dependence and Chinese involvement in critical and digital infrastructure
  5. Emphasize our commitment to human rights and the people of Hong Kong enshrined in the Joint Declaration
  6. Work with allies to coordinate action and policies, strengthen democratic alliances and reduce strategic dependence

Al-Shabaab and Chinese Trade Practices in Mozambique  In 2020, eight Mozambican public officials and one Chinese national named Zhao were arrested for illegally harvesting and exporting timber from Cabo Delgado — Mozambique’s northernmost province — to China. According to local reports, five of the Mozambicans are awaiting trial while Zhao and three Mozambicans have been released, and the seized wood was returned to Zhao personally. Chinese manufacturing firms’ appetite for commodities drives people like Zhao to seek their fortunes in vulnerable communities around the world. Frequently, local elites find it in their interest to enable these firms’ engagement in illegal business practices. During a fieldwork visit to the region in July, for instance, local officials in Cabo Delgado’s district of Montepuez described how Chinese timber traders flouted local laws with impunity. This type of sentiment can be found not just across the rest of Mozambique, but across Africa and around the world.  Illegal Chinese business practices in Cabo Delgado are making the province less safe. Cabo Delgado is home to an Islamist insurgency known as al-Shabaab (or Ahlu-Sunnah Wa-Jama, not to be confused with the al-Shabaab in Somalia) that has killed at least 3,000 people since October 2017. The illegal timber trade is exacerbating the conflict because it provides a valuable source of income to the insurgency, and it fuels discontent in the surrounding areas that the insurgency can feed off – namely labor abuses, lost livelihoods from deforestation, and increased vulnerability to severe weather. Cabo Delgado is an acute and instructive example of the nexus among insecurity, corruption, and corporate malfeasance that may arise again unless Chinese officials take greater action. Illicit trade and corruption have long bedeviled Mozambique. Its timber reserves were first plundered during the Portuguese colonial period, but illegal trade in endangered species, narcotics, and gemstones has flourished since independence up to the present day. For decades, Cabo Delgado has acted as a hub for illicit trade between Asia and Africa. More in this War on the Rocks article.

Testimony of the National Cyber Director / U.S. Senate Committee on Homeland Security and Governmental Affairs During the Testimony on September 23, 2021, the National Cyber Director remarked that “cyberspace is attractive to our adversaries and frustrating to our allies because of how difficult it is for any one country or entity to have the benefit of a complete picture of actions and actors across the shared spaces of cyberspace. Cyberspace allows a global reach and efficiency of scale unrivaled in any other domain, meaning that our geopolitical competitors can have global reach and strategic effect and criminals and extremists can have wield an unprecedented level of impact and coercion. Malign actors big and small often believe they can evade consequence for acts and crimes that in most other realms would provoke swift and severe responses.”

Global Organized Crime Index 2021 The Global Organized Crime Index is the result of a two-year endeavor to evaluate levels of crime and resilience in all 193 UN member states. Through this data, it is hoped that the Index will help inform a truly global response to the pervasive threat of transnational organized crime. Organized crime is a scourge that afflicts countries in every corner of the globe, from tiny island states to large economic superpowers, and is an underlying driver of many major geopolitical challenges including conflict, political instability and forced migration. Because of its clandestine nature, however, often little is known about how organized crime operates in each country. To address this knowledge gap, the GI-TOC has developed the Global Organized Crime Index, a unique, data-driven analytical tool that evaluates 193 UN member states according to two metrics: according to their criminality on a score from 1 to 10 (lowest to highest organized crime levels), which in turn is based on their criminal markets score and criminal actors score; and according to their resilience to organized crime, from 1 to 10 (lowest to highest resilience levels). The results of the first edition of the Global Organized Crime Index, outlined in the flagship report and the interactive Index website, paint a worrying picture of the reach, scale and impact of organized crime in 2020. Perhaps the starkest finding of the Index is that the majority of people worldwide live in countries with high levels of organized crime. The Index also shines a light on the ubiquity of some of the most insidious forms of exploitation that are perpetrated by criminal actors the world over, including individuals and networks operating from within the state apparatus. The Index also illustrates the widespread shortcomings in global levels of resilience to organized crime, from weaknesses in criminal justice systems to rampant corruption and violent crackdowns on the freedom of the press and civil society. As a snapshot of 2020, the Index also highlights the adaptability of organized crime to the pandemic. In the face of lockdowns and travel restrictions, criminals not only retooled their regular business, but also exploited new opportunities presented by the global health crisis. Individuals, communities and businesses struggling to stay afloat also became increasingly vulnerable to organized criminal behavior, either as victims or as perpetrators, albeit more often than not due to the absence of any viable alternatives. Addressing the pervasiveness and entrenched nature of organized crime revealed by the Index will require a coordinated global response, but as yet this remains lacking. By providing a consolidated hub of data and baseline evidence of the phenomenon in countries across the world, the Index aims to be a catalyst for further debate on transnational organized crime. Ultimately, the Index strives to inform policymakers and regional bodies so they can prioritize interventions based on a multifaceted assessment of vulnerabilities and enhance national, regional and global cooperation in countering organized crime.

The Authoritarian Interference Tracker  The Authoritarian Interference Tracker* catalogues the Russian and Chinese governments’ activities to undermine democracy in more than 40 transatlantic countries since 2000 using five tools: information manipulation, cyber operations, malign finance, civil society subversion, and economic coercion. The Tracker shines a light on the tactics and trends that define the Russian and Chinese governments’ interference efforts, and highlights the interconnectivity between different parts of the asymmetric toolkit.  See below for definitions of these tools and an explanation of the methodology for including cases in the Tracker. Efforts by the Russian and Chinese governments to undermine democracy are not restricted to the transatlantic community. For example, China is particularly active in interfering in democracies in the Asia-Pacific region. Forthcoming iterations of the Tracker will expand to regions beyond North America and Europe, as well as add instances of authoritarian interference by other regimes that adopt similar tactics to undermine democracies. *The Alliance for Securing Democracy (ASD), a nonpartisan initiative housed at the German Marshall Fund of the United States, develops comprehensive strategies to deter, defend against, and raise the costs on autocratic efforts to undermine and interfere in democratic institutions. ASD has staff in Washington, D.C., and Brussels, bringing together experts on disinformation, malign finance, emerging technologies, elections integrity, economic coercion, and cybersecurity, as well as Russia, China, and the Middle East, to collaborate across traditional stovepipes and develop cross-cutting frameworks. The Authoritarian Interference Tracker is one of the tools created by the ASD.

Overcoming the Tragedy of TPP  In common parlance today, the word “tragedy” is used to describe any ill fortune that befalls a person or group: a destructive earthquake, a fatal shooting, the death of a family member from disease. But to the ancient Greeks, tragedy involved an element of human error (“hamartia’), not just external circumstance. On this measure, the saga of the United States and the Trans-Pacific Partnership (TPP) would have given Sophocles enough material for an epic to rival Oedipus Rex. From the start, TPP was marked by tragic irony—with China always in a supporting role. The George W. Bush administration notified Congress of its intent to negotiate a high-standard trade agreement with Asia-Pacific partners on September 22, 2008—one week into a global financial crisis that would severely undermine U.S. economic leadership and embolden Beijing. While quick to embrace TPP and successful in concluding an agreement among the parties, President Barack Obama fatally delayed pushing for trade promotion authority from Congress in 2014—choosing instead to name the chairman of the relevant Senate committee, Max Baucus, as his ambassador to China. And in one of his first, catastrophic acts as president, Donald Trump withdrew the United States from the unratified TPP—not understanding that it was one of the most powerful tools he had to compete with his nemesis, China. And now the People’s Republic of China has applied to join TPP’s successor agreement, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Tragic irony, indeed. More in this CSIS Commentary.

China’s hunt for dissidents has gone global For years, China has purported to be a new type of great power: one that rises peacefully and respects the rights of other states rather than chasing the foreign domination of empires past. “China will never seek hegemony, expansion or a sphere of influence,” President Xi Jinping said in April. Yet many of Beijing’s policies have a distinctly imperial feel. A case in point is a wide-ranging effort to give Chinese law enforcement global reach, and thereby hound the regime’s enemies wherever they may go. The programs in question are known as Operation Fox Hunt and Operation Skynet. As ProPublica has reported, their stated purpose is to track down white-collar criminals who have sought refuge abroad. Yet in many cases, the real targets are dissidents or political foes of Xi. Networks of Chinese agents have fanned out across countries around the world, usually without the knowledge of local authorities, to surveil and apprehend wanted individuals, according to the U.S. Justice Department and press reports. They often rely on heavy doses of coercion, reportedly using family members who still live in China — and are thus at the mercy of the Chinese Communist Party — as leverage to bring those individuals home. Chinese officials say that these programs have nabbed more than 8,000 fugitives since 2014. And China’s “fox hunters” are not simply stalking their prey in small, underdeveloped countries with weak law-enforcement capabilities. One unsuccessful operation, involving 19 agents and local accomplices, targeted a Chinese citizen living outside of New York City, according to U.S. authorities. It was not, apparently, an isolated incident. Director Christopher Wray of the Federal Bureau of Investigation has said that “hundreds of the Fox Hunt victims that they target live right here in the United States, and many are American citizens or green card holders.” More in AEI’s recent op-ed.

National Artificial Intelligence Strategy (UK) The U.K. government on Wednesday released its 10-year plan to make the country a global “artificial intelligence superpower”, seeking to rival the likes of the U.S. and China. The so-called “National Artificial Intelligence Strategy” is designed to boost the use of AI among the nation’s businesses, attract international investment into British AI companies and develop the next generation of homegrown tech talent. 

Deepening Not Departure: Xi Jinping’s Governance of China’s State-owned Economy To what extent has governance of China’s state-owned economy changed under Xi Jinping? Against the background of momentous shifts in the political arena since 2012, some observe a decisive departure in Xi’s approach to managing state-owned enterprises (SOEs): towards tight centralized control by the Chinese Communist Party and away from gradual marketization. Analyzing the main aims and methods of SOE governance over the last two decades, we find that SOE policy under Xi exhibits a deepening of pre-existing trends rather than a departure. First, the essential vision of SOE functions articulated under Xi is strikingly consistent with that of his predecessors. Second, his administration’s approach to governing SOEs is not novel; it relies on established mechanisms of bureaucratic design, the cadre management system, Party organizations and campaigns. While Xi has amplified Party-centered tools of command and control, this appears to be an incremental rather than a radical shift in approach. More in The China Quarterly, published online by Cambridge University Press on September 23, 2021.

“Guidelines for Building a Powerful Country with Intellectual Property Rights (2021-2035)” On September 22, 2021, the Central Committee of the Communist Party of China and the State Council issued the “Guidelines for Building a Powerful Country with Intellectual Property Rights (2021-2035)”. The Guidelines set numerical development goals for intellectual property as well as other goals such as “deep participation in global intellectual property governance.” By 2025, remarkable achievements shall have been made in the building of a powerful intellectual property nation, the protection of intellectual property shall be more stringent, social satisfaction shall have reached and remained at a relatively high level, the market value of intellectual property shall have been further highlighted, brand competitiveness shall have been significantly improved, the added value of patent-intensive industries shall have accounted for 13% of GDP, the added value of copyright industries shall have accounted for 7.5% of GDP, the total annual import and export amount of intellectual property use fees shall have reached 350 billion yuan, and the number of high-value invention patents per 10,000 people will reach 12. Note that the Guidelines do not define what are patent-intensive or copyright-intensive industries are, nor what are “high-value patents.” Numerical goals for 2035 were not released. More information can be found in Volume XI, Number 267 of the National Law Review. 

Taiwan submits bid to join CPTPP trade pact Taiwan announced Thursday that it has submitted an application to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the cabinet said late Wednesday, in a move expected to trigger opposition from China. Taiwanese authorities have submitted the application to New Zealand, which acts as the depositary for the Pacific rim trade pact, and sought the support of all existing members. Details on the application will be announced Thursday. The move comes less than a week after China last Thursday applied for membership in the CPTPP, which sets rules for tariff-free trade and investment and data flows. The timing suggests a rush by Taipei in response to Beijing’s bid. In order to join the CPTPP, Taiwan will need approval from all 11 of its existing members, which include Japan and Australia. The island already has bilateral free trade agreement with New Zealand and Singapore, another CPTPP member. Securing membership in the CPTPP has been a goal for Taiwanese President Tsai Ing-wen, who has not sought to join the Regional Comprehensive Economic Partnership, a China-led regional trade pact that also includes Southeast Asia, Japan, South Korea, Australia and New Zealand. Taiwan’s bid is likely to be followed by diplomatic wrangling as Taipei and Beijing each seek to influence existing CPTPP members. More in this recent NikkeiAsia article.

Scoop: U.S. government buying risky Chinese drones Federal law enforcement agencies are purchasing surveillance drones from a Chinese company the Pentagon has deemed a potential national security threat, Axios has learned. Efforts to purge military and law enforcement agencies of potentially compromised Chinese technology have stalled amid bureaucratic red tape, and experts worry the federal government is needlessly exposing itself to snooping by malicious foreign actors. The U.S. Secret Service is the latest to purchase surveillance drones from the Shenzhen-based company DJI, which dominates the commercial drone market in the U.S. and abroad. The Secret Service bought eight DJI drones on July 26, according to procurement records. That was three days after the Defense Department released a statement saying DJI products “pose potential threats to national security.” The FBI bought 19 DJI drones a few days earlier, records show. DJI makes an array of consumer products that are tremendously popular, including the Phantom and Mavic drone series, as well as the Osmo image-stabilization handle. While the products are used for personal and commercial purposes, they also require the user to download proprietary DJI software, and to fly using mapping databases that have the potential to be monitored remotely. Security concerns surrounding these products are longstanding, but DJI insists all such concerns are unfounded and based on misunderstanding or misrepresentation of its technology. 

Assessment of cybersecurity of mobile devices supporting 5G technology sold in Lithuania / Analysis of products made by Huawei, Xiaomi and OnePlus To ensure the use of secure software and hardware in the country, Lithuania’s National Cyber Security Centre (NCSC) under the Ministry of National Defense carried out a cyber security assessment of mobile devices supporting 5G technology sold in Lithuania by Chinese manufacturers. This analysis presents the results of the assessment of smartphones manufactured by Huawei, Xiaomi and OnePlus. Huawei, Xiaomi and OnePlus are Chinese IT and consumer electronics manufacturers with an international presence and a strong presence in the European market. In 2020, these manufacturers introduced to the Lithuanian market smartphones supporting fifth-generation (5G) mobile technology. The security assessment was carried out for widely available Huawei P40 5G, Xiaomi Mi 10T 5G and OnePlus 8T 5G mobile devices. Despite these brands being well-known, in the 2017-2021 period the corporations faced security challenges for the equipment being developed; according to the CVE database (Common Vulnerabilities and Exposures), 9 vulnerabilities related to the risk of personal data leaking were identified for Xiaomi’s production (8 of these vulnerabilities could be realized by remote means), 144 vulnerabilities were identified for Huawei’s products during this period (28 vulnerabilities were identified in 2020; 23 in the first half of 2021), most of which were related to disruption of device functionality, and one vulnerability was identified in 2020 allowing an attacker to use third-party software to send SMS text from a mobile device when the mobile device was locked. Various sources assess that these manufacturers have a leading position in the mobile device market, and their wide assortment of products, their development of new technologies and their noticeable growth in Lithuania undoubtedly make them an appropriate object for cyber security research.

The US and China Are Decoupling, and Other Countries Are Following Several major countries are investing more than ever in technology and supply chain independence. And yet the global technology industry will continue to be codependent for the foreseeable future, as many barriers to self-reliance will take years to break down. These two opposing dynamics have forced technology executives into a high-wire balancing act: How can they step toward the decoupled era while simultaneously keeping the other foot stable in today’s codependent reality? And how long will they be required to maintain this balancing act? The US and China pushed the world in this direction, according to Bain, and the decoupling of their economies and technology ecosystems has been gaining momentum for several years. Consider this: Technology-related foreign direct investment between the two countries dropped by 96% from 2016 to 2020. Now, the US and China are upping their bids for technology and supply chain independence with massive domestic investments. In June, the US Senate approved the $250 billion US Innovation and Competition Act, which would provide $52 billion for domestic semiconductor research and manufacturing, a 30% funding boost for the National Science Foundation, and $29 billion to fund a new applied sciences directorate. Meanwhile, China’s annual spending on R&D climbed to more than $350 billion in 2020, and the country is spending $1.4 trillion over the next few years in infrastructure technologies such as artificial intelligence (AI), semiconductors, and 5G networks. The two nations’ recent moves signal that decoupling will be a defining feature of the technology landscape for years to come, even with one of its most prominent contributors—former US President Donald Trump—no longer in office.  More in Bain’s 2021 Technology Report.

The Art of Cyberwarfare: Chinese APTs attack Russia Much has been made about the emerging relationship between China and Russia, two countries that the National Defense Strategy recognizes as near-peer competitors to the United States. They’re already collaborating on research, both are run by autocratic regimes, and neither has much affinity for the United States. But the marriage may not be as steady as Russia, especially, would like others to believe. A new report out of Russia accuses the Chinese government of hacking Russian state targets. 

Full Membership in the Shanghai Cooperation Organization (SCO): A Win-Win Game? Iran’s bid to become a full member of the Shanghai Cooperation Organization (SCO) dates to one year after it received observer status in 2005. All along, however, the most important legal obstacle to its accession has been a series of United Nations Security Council resolutions that identify the Islamic Republic of Iran as a threat to world peace and security. Nevertheless, Iran’s regional neighbors recognized that the country could be an important element of the so-called “North-South” multimodal transit corridor that will more closely connect eastern and western Eurasia, and which can become a leading symbol of cooperation among all the members of the SCO. Iranian participation in both would, thus, ease, if not wholly overcome, the years of extensive effort by Western countries, led by the United States, to isolate the Islamic Republic using various means of economic, political and security pressure. More in this Publication (Eurasia Daily Monitor Volume: 18 Issue: 143).

A Limited Partnership – Russia-China Relations in the Mediterranean In the last several years, Russia and China have increased their presence and influence in the Mediterranean, creating opportunities for growing cooperation at odds with U.S. interests and objectives in the region. A new CNAS report explores how the United States and its allies should approach the two distinct challenges of Russia-China cooperation in the Mediterranean: Russia a security one and China an economic one. 

Crucial Collaboration: The Case for Closer Australia-UK Defense and Security Ties in Light of a Rising China China’s rise is perhaps the single most significant geopolitical question of the next decade – indeed, the next century. The sheer scale of its economy and military, combined with an increasingly authoritarian regime under Xi Jinping, means that the Indo-Pacific lies at the heart of the China challenge. Growing militarization and Chinese aggression are destabilizing the region, whilst Beijing’s willingness to use economic coercion in an attempt to bend governments to its will has highlighted the need for trade diversification. This paper argues that the now is the time to broaden and deepen the Australia-UK relationship as the post-Brexit UK tilts to the Indo Pacific. It outlines ways to collaborate on defense, intelligence and security and to tackle grey-zone interference, through both working together and with other like-minded partners. On the economic front, CIS* Policy Paper 42 notes that the recently-agreed Australia-UK Free Trade Agreement should herald a new trend towards export diversification to counter China’s trade coercion. Both nations should also collaborate on setting international standards for emerging digital technologies that embed liberal norms, whilst working to deliver on the promises of the G7 B3W framework as a compelling alternative to the Belt and Road in the South Pacific. *The Centre for Independent Studies is Australia’s indispensable voice providing independent research and policy solutions enabling the pursuit of happiness, and the opportunity to live a prosperous life with less government interference.

Advancing U.S. Goals in the U.S.-EU Trade and Technology Council As the Biden administration works with its EU counterparts through the new U.S.-EU Trade and Technology Council (TTC), it should hold firm in defending the superior U.S. innovation system. To that end, U.S. negotiators must first clarify their positions on at least four strategic questions, according to this ITIF new report (the Information Technology and Innovation Foundation is an independent, nonprofit, nonpartisan research and educational institute). Key takeaways:

  • The EU’s precautionary approach to digital technologies is antithetical to U.S. economic and national security interests because it limits innovation and growth, which the United States urgently needs.
  • It is critical for U.S. negotiators to vigorously defend U.S. economic interests in the TTC. They should not gloss over real differences in privacy rules, AI regulation, antitrust regulation, digital taxation, content moderation, and others.
  • When it comes to areas of regulation that affect cross-border trade, the United States and EU should work together more closely to ensure their respective approaches are interoperable.
  • It would be ideal if the EU were to unequivocally join the United States to limit Chinese innovation mercantilism and digital authoritarianism, but if the EU takes even limited measures toward that goal, it would be a success.
  • Both sides need to commit to a successful relationship. But U.S. negotiators should not define success as emulating the EU or increasing cooperation for its own sake; they should increase cooperation while advancing key U.S. national interests.

‘Just Get Me a Box’: Inside the Brutal Realities of Supply Chain Hell It’s mid-August, and her phone won’t stop pinging. Her faucets, sinks, and toilets are waylaid near Shanghai, snagged in Vancouver, and buried under a pile of shipping containers in a rail yard outside Chicago. As U.S. transportation manager for Gerber Plumbing Fixtures LLC, a unit of Taiwan’s Globe Union Industrial Corp., that’s based in Woodridge, Ill., she is trying to overcome the biggest shock wave to unsettle global trade since the dawn of container shipping almost seven decades ago. The pandemic has thrown the vital but usually humdrum world of logistics into a tailspin, spurring shortages of everything: masks and vaccine vials, semiconductors, plastic polymers, bicycles, and even baseball bobbleheads. For the logistics manager it’s complicated, the shipment of about 10,000 20-foot containers of bathroom equipment she brings into the U.S. each year from China and Mexico, but it has also revealed a bigger, structural challenge. The system underpinning globalization—production on one side of the planet, connected to consumers on the other by trucks, ships, planes, cranes, and forklifts—is too rigid to absorb today’s rolling tremors from Covid-19, or to recover quickly from the jolts to consumer demand or the labor force. It’s avoided a complete collapse only through a combination of human ingenuity, painfully long hours, and, as Thomas describes a recent success, strategy, mixed with a stroke of luck. More in the Bloomberg Businessweek article of September 16, 2021.

China’s New Direction: Challenges and Opportunities for US Policy This new report from the Task Force on U.S.-China Policy, a group of China specialists from around the U.S., convened by Asia Society’s Center on U.S.-China Relations, is divided into eight sections. Each includes a thumbnail analysis of the evolving trends inside China, and recommendations for how the Biden Administration might incorporate such understandings into the next phase of its China strategy. Below are some of the most significant insights identified by Task Force members:

POLITICS China’s effective control of the pandemic and nationalistic rallying of popular opinion against Western powers’ blaming of China for its outbreak have strengthened Xi’s position in the Party and his popularity among the public. We can expect rules and norms to be finessed to extend Xi’s tenure for a third term at the 20th Party Congress next year. Xi’s dictatorial system creates pressures for officials to show loyalty and distorts information feedback loops, two kinds of policymaking dynamics that lead to domestic and international overreaching.
SOCIETY The CCP has tightened supervision over universities, curtailed press freedom and placed civil society groups under strict control. Still, there is great dynamism and diversity in China’s economic and social life. That said, Chinese people rarely make explicit political demands, and their support for the Chinese Communist Party appears to have grown in recent years alongside targeted retribution by the Party against certain groups.
HUMAN RIGHTS The CCP has intensified its crackdown not just on opposition and dissent, but also on perceived disloyalty, disaffection, policy disagreements and ideological nonconformity. Repression and social control have reached their highest levels in the post-Tiananmen period, especially in China’s peripheral regions such as Xinjiang and Tibet. In Hong Kong, Beijing has crushed autonomous political activity, academic and journalistic freedoms. All this reflects a surprising sense of siege on the part of the Chinese government, despite the popular support it receives inside China.
ECONOMY China is using large-scale state intervention to increase national economic power and technological independence. The state is mobilizing significant financial support for favored sectors and companies, distorting capital allocation and corroding fair competition and market-determined outcomes in China and the rest of the world. Still, China is expected to remain open to foreign investment and financial institutions so long as that serves the government’s goals.
TECHNOLOGY China’s technology drive is massive in scale, led by the state but also enabled by an increasingly state-influenced private sector. Chinese policymakers have doubled down on their commitment to become technologically independent, especially in strategically essential sectors like semiconductors. In fact, Beijing has done more to “decouple” its supply chain from dependence on the U.S., than the other way around.
MILITARY China has developed a robust capability to fight effectively within the first island chain that runs north to south from Japan and Taiwan to the Philippines. These expanding capabilities are aimed at deterring and defeating U.S. military intervention in East Asia, especially in defense of Taiwan.
DIPLOMACY China has abandoned its Deng Xiaoping-era low-profile, risk-averse diplomacy. China’s current forceful foreign policy aims to protect its interests, ensure access to global markets, capital and technologies, and demand international respect for China’s achievements. Economic instruments are its preferred tool of statecraft, with active efforts directed toward shaping the global order regarding human rights, internet governance, technology standards and development finance. China’s leaders seek respect and even admiration for their Party-centered political system, though they stop short of evangelizing or trying to export a complete model of governance.
CLIMATE CHANGE U.S.-China cooperation, coordination and healthy competition will be essential if the world is to achieve the 2015 Paris Climate Agreement objectives, and if China is to achieve its 2060 carbon neutrality goals. China’s leaders have focused on developing clean technologies and created financial incentives for climate action within China. Yet, the government has been reluctant to aggressively curtail coal use at home and to reduce support for fossil- fuel energy projects abroad if it means acting against the interests of state-owned enterprises.

Direction of EU-Russia Political Relation On September 16, 2021, the EU Parliament adopted a resolution on the “Direction of EU-Russia Political Relations”, which calls for a new EU strategy to promote democracy in Russia and changes to the EU sanctions on Russia. China is mentioned twice: 1) “the EU must strengthen its cooperation with the US and other like-minded partners and establish an alliance to defend democracy globally and propose a democracy defense toolkit, which should include joint actions on sanctions, policies to counter illicit financial flows, rules on the conditionality of economic and financial assistance, international investigations, and an ambitious agenda to support freedom and democracy, human rights activists and defenders of democracy; in addition, the EU’s agenda should counterbalance the efforts of Russia and China to weaken democracy worldwide and destabilize the European order;”, and 2) “Whereas it is deplorable that the Russian authorities are willingly or unwillingly locking their country into dependency on China, which can only weaken the Russian Federation and the entire European continent and, in particular, enable the Chinese authorities to expand their presence and influence in Central Asia and Siberia.” European Parliament recommendation of 16 September 2021 to the Council, the Commission and the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy on the direction of EU-Russia political relations (2021/2042(INI)).

What Do Overseas Visits Reveal about China’s Foreign Policy Priorities? It’s notable that Xi Jinping hasn’t left China since the start of the coronavirus pandemic (according to Bloomberg News on September 9, 2021, Xi Jinping hasn’t set foot outside China for 600 days) as opposed to his previous regular program of foreign travel. Concerns over COVID-19 clearly play a part in this change, but it may also represent domestic political worries: foreign trips traditionally present opportunities for moving against temporarily absent leaders.

Headline or Trend Line? Evaluating Chinese-Russian Collaboration in AI Chinese and Russian government officials are keen to publicize their countries’ strategic partnership in emerging technologies, particularly artificial intelligence. This CSET report evaluates the scope of cooperation between China and Russia as well as relative trends over time in two key metrics of AI development: research publications and investment. The findings expose gaps between aspirations and reality, bringing greater accuracy and nuance to current assessments of Sino-Russian tech cooperation.

China is Fast Outpacing U.S. STEM PhD Growth Since the mid-2000s, China has consistently graduated more STEM PhDs than the United States, a key indicator of a country’s future competitiveness in STEM (science, technology, engineering and math) fields. This CSET paper explores the data on STEM PhD graduation rates and projects their growth over the next five years, during which the gap between China and the United States is expected to increase significantly.

Building Resilient Medical Supply Chains Through Trade Agreements With the outbreak of the COVID-19 pandemic, policymakers have become increasingly concerned about the pharmaceutical supply chain—and ensuring the American public can access vital products. Yet even under the tremendous pressure of the pandemic, the supply chain proved itself to be remarkably resilient. That said, there are ways to enhance that resiliency —without resorting to rank protectionism—in the face of legitimate concerns about certain foreign trade practices, including China’s. R Street released a new white paper which does exactly this: surveys the performance of supply chains in recent years and offers concrete policy recommendations.

China’s “Big Tech Crackdown”: A Guide and Guideline The Chinese government is tightening its control over Chinese technology companies in dramatic ways: There will be a sea change in 2021: Capital flows between the U.S. and China will in some cases reverse, and the incentives that have driven the Chinese economy for the last two decades have changed. You’ll find the Guide here and here an interactive timeline of all of Beijing’s major regulatory actions and other developments contributing to what has become known as the “Big Tech crackdown”.

In the driver’s seat: China’s electric vehicle makers target Europe China will become a major automotive export hub with localized supply chains – and Europe is the main market, finds a new MERICS report. The report’s main findings and recommendations are:

China will become a major automotive export hub. Fueled by technological change, huge production capacity and government support China has the necessary requirements to export vehicles on a large scale.
Europe is the main market for Chinese electric vehicle (EV) exporters. Europe has the second highest demand for EVs after China. Buyers benefit from high subsidies and a comparatively well-developed charging network. China’s automakers have government support to master European safety ratings.
China’s government directs and pressures Chinese and China-based foreign carmakers to export. The government has relegated its ambition to primarily promote national champions in favor of absorbing global value chains. The government is also setting targets and providing information about overseas regulations to help Chinese EV makers overseas advance.
Chinese manufacturers are moving up the value chain. Chinese car makers have leapfrogged established carmakers and can now produce desirable, safe and technologically advanced EVs. A few Chinese brands have a shot to rank among the world’s most successful carmakers.
Chinese companies’ overseas investments and partnerships make them global competitors. Automotive competition is going to increase globally, and consequently Chinese battery manufacturers and carmakers are expanding their global footprint. Exports are only the tip of the iceberg as companies pursue different strategies to leverage international brands and access overseas markets.
Government subsidies for China-based manufacturers could distort global markets. That China has become the leading EV market is the result of substantial government support. But Chinese exports are also directly supported by central and local governments sponsorship of new production plants, R&D centers and overseas acquisitions.

Rare Earth Myth China dominates the mining and refinement of rare earths, which are needed for almost all of the electronic devices that power our 21st-century lives. But contrary to popular perception, China neither can nor wants to weaponize the global supply, according to this article in SupChina.

The Missing Context in America’s Competition with China “What does winning this competition with China look like? Answering that question means articulating a strategic vision for the United States, a vision with a timeline of decades. That objective, and the actions American society will need to take to achieve it, will have outsized influence over US foreign, domestic, and economic policies for generations. President Joe Biden and Congress are taking important initial steps, such as addressing supply chain vulnerabilities, boosting R&D funding, and engaging with allies. Leaders from civil society and industry are producing untold recommendations ranging from tax incentives to new government agencies to moonshot technology development efforts. Missing, though, is the overarching context in which these actions should take place. The US government needs to articulate a national technology strategy for an era of sustained competition with a highly capable contender. A national technology strategy includes how the US invents, innovates, and deploys technologies — such as biotech, quantum computing, microelectronics, energy storage, etc. — to compete economically while securing its national interests. More in this article, published by Inkstick.

The Huawei Moment For the first time, a Chinese company—Huawei—is set to lead the global transition from one key national security infrastructure technology to the next. How did Washington, at the beginning of the twenty-first century, fail to protect U.S. firms in this strategic technology and allow a geopolitical competitor to take a leadership position in a national security relevant critical infrastructure such as telecommunications? This CSET policy brief highlights the characteristics of 5G development that China leveraged, exploited, and supported to take the lead in this key technology. The Huawei case study is in some ways the canary in the coal mine for emerging technologies and an illustration of what can happen to U.S. competitiveness when China’s companies do not have to base decisions on market forces.

Paper on Trustworthy Artificial Intelligence This paper, co-authored by a PRC state think tank describes the importance and difficulty of improving the “trustworthiness” of AI systems. The authors recommend increased use of methods such as federated learning and differential privacy to strengthen AI systems’ capability to withstand cyberattacks. The white paper’s policy recommendations include drafting more Chinese legislation related to trustworthy AI, developing commercial AI insurance policies, and taking a cautious approach to research on artificial general intelligence (AGI). This is the CSET translation of this significant foreign language document on AI.

 Fiscal Year 2022 Intelligence Authorization Act approved In July, 2021, the Senate Intelligence Committee unanimously approved its FY 2022 Intelligence Authorization Act. Timing for full Senate consideration of the bill has not yet been announced. The unclassified portions of the bill include several provisions related to AI and emerging technology:

Sec. 336 requires the Director of National Intelligence to report to Congress on trends in technologies of strategic importance to the United States and areas in which competitors are poised to match or surpass the United States. 

Sec. 340 requires the DNI to develop a plan for establishing a modern digital ecosystem for the development, testing, fielding and updating of AI systems.
Sec. 343 requires the DNI to report to Congress on the potential to strengthen all-source intelligence integration on foreign cyber threats, with a particular focus on cyber supply chain risks.
Sec. 352 requires the DNI to submit to Congress a plan to increase cooperation with the intelligence agencies of key democratic partners regarding technological competition with China.
Sec. 601 requires the president to report to Congress annually with a technology strategy to maintain U.S. leadership in critical and emerging technologies relevant to U.S. national security.

China’s new Data Security Law On September 1, 2021, China’s new Data Security Law went into effect. Passed by the NPC in June, the law applies to all companies — both domestic and international — with a presence in China. Some experts have raised concerns that one aspect of the law, a provision that requires companies and researchers within China to disclose information about software vulnerabilities to the Chinese government, could pose a serious cybersecurity risk to non-Chinese entities, including the U.S. government. 

Chinese Views of U.S. Decline The idea of an America in decline has become a major subject of discussion among many PRC observers.  A seeming preponderance of Chinese authoritative, semi-authoritative, and non-authoritative Chinese elites believe that the distribution of global power is shifting
in a direction that favors China over the West/the United States. However, what is less clear is how those many Chinese who see the U.S. as being in decline view the specific origins, nature, and extent of that decline and its implications for China. Chinese public statements on the decline offer no conclusive evidence supporting the claim that Beijing is basing its policies on the sure conviction that the U.S. is in an irreversible, structural decline benefiting China and that Beijing is therefore committed to a policy of taking advantage of this decline. A more nuanced understanding of Chinese discourse on U.S. decline and its implications for the United States is in order. Please see the article in the China Leadership Monitor, Fall 2021 Issue 69.

The UK and China’s security and trade relationship: A strategic void HOUSE OF LORDS / International Relations and Defence Committee / 1st Report of Session 2021–22

New beginnings: Rethinking business and trade in an era of strategic clarity and rolling disruption The Australian Strategic Policy Institute is delighted to share the new report ‘New beginnings: Rethinking business and trade in an era of strategic clarity and rolling disruption’. This report considers the relationship between our business and trade positioning in the context of the impacts of Covid-19, natural disasters and the actions of coercive trading partners. Global economic integration has enabled the spread of ideas, products, people and investment at never-before-seen speed. International free trade has been a goal of policy-makers and academics for generations, allowing and fostering innovation and growth. The mechanism shuddered in 2008 when the movement of money faltered; the disruption brought about by Covid-19 has seen a much more multi-dimensional failure of the systems which we share and move. The unstoppable conveyor belt of our global supply chain has ground to a halt. This time, what will we learn? The report examines the vulnerabilities in Australia’s national security, resilience and sovereignty in relation to supply chains and the intersection of the corporate sector and government highlighting recent paradigm shifts in geopolitics, whereby economic and trade priorities are increasingly relevant to the national security discussion. A key insight from the research is that there are plenty of opportunities for Australia to expand its investment horizons. Growth industries that deserve attention include data and technology, biotechnology, renewable energy, clean steel, agritech, critical minerals and rare earths. In each of these industries, Australia can leverage a strategic advantage to establish and maintain reliable, high-value supply chains. The profound economic shock of the pandemic provides the perfect time to assess our relationships with our trading partners, our industries and internally, between our governments and the corporate world. Click here to read the report.

Where Next on UK-China Engagement? A major new report from the British Foreign Policy Group warns the UK still has a long way to go before it can effectively and constructively engage with China, and secure the nation against the challenges China poses now and into the future. The report recognizes the UK Government has made important progress in implementing new safeguards and in building a more robust strategy on human rights and global norms. But it argues the UK’s ‘reset’ on China remains a work in progress, and there is still much to be done to strengthen the UK’s position so we can pursue China engagement from a more confident position. Significant, structural change to policy-making processes will be required to effectively balance security and openness, as pursuing a ‘balanced’ relationship will involve regular points of tension. We must build systems capable of accommodating these in a principled and consistent fashion. In light of the ongoing scrutiny that will be required towards different points of engagement, the report proposes a “triad” model for making decisions about actions towards China – categorising choices around the nature, sphere and stakes of such decisions, to ensure the Government can consider their implications in the round.

10 key arguments in the report:

  1. The UK must deepen and enhance institutional knowledge about China.
  2. Economic engagement continues to present opportunities, but we must be realistic about the nature of our negotiating position.
  3. China’s attendance at COP is a key measure of success for the UK, but we must accept it realizes its scope of leverage on climate action.
  4. We must pursue a robust line on human rights with China, and ensure we uphold these standards at home and in our other partnerships.
  5. Even when the UK experiences geopolitical disputes or areas of tension with China, they must not be conflated with the Chinese people.
  6. The UK Government must ensure that the decision to temporarily reduce our foreign aid spending does not create a vacuum for China to seize upon.
  7. We must strengthen the process of securing our critical national infrastructure, and future-proof our definition of what will become valuable to us.
  8. Britain must lean into its special capabilities in designing the governance frameworks of the future, which will address many areas of growing importance to China.
  9. While the UK-China bilateral relationship will remain unique, we must also build and maintain the foundations of a collective approach to China amongst liberal allies.
  10. China provides a striking example of the urgent need to integrate our domestic and international resilience agendas.

Illicit Fentanyl from China: An Evolving Global Operation The U.S.-China Commission’s issue brief examines the evolution of China’s role in global illicit fentanyl trade. China placed all forms of fentanyl and its analogues on a regulatory schedule in 2019, but the U.S. Drug Enforcement Administration (DEA) assesses China remains the primary country of origin for illicit fentanyl and fentanyl-related substances trafficked in the United States. While Mexican drug cartels have always been a critical node for smuggling illicit fentanyl into the United States, this brief finds that the links between Chinese and Mexican actors in the fentanyl trade has grown in complexity, including the development of sophisticated money laundering operations. Finally, the brief concludes that while cooperation between the United States and China remains limited, there are opportunities for the United States to work with other countries on counter-narcotic enforcement. The key findings of the report are:

  • China remains the primary country of origin for illicit fentanyl and fentanyl-related substances trafficked into the United States: In 2019, China fulfilled a pledge to the United States and placed all forms of fentanyl and its analogues on a regulatory schedule. Nevertheless, illicit fentanyl from China remains widely available in the United States. Chinese traffickers are using various strategies to circumvent new regulations, including focusing on chemical precursors, relocating some manufacturing to India, rerouting precursor shipments through third countries, and leveraging marketing schemes to avoid detection. China’s weak supervision and regulation of its chemical and pharmaceutical industry also enable evasion and circumvention.
  • Since China’s government scheduled fentanyl, the amount of finished fentanyl shipped directly from China to the United States has declined, while the amount shipped from Mexico has increased: The U.S. Drug Enforcement Administration (DEA) assesses Chinese traffickers have shifted from primarily manufacturing finished fentanyl to primarily exporting precursors to Mexican cartels, who manufacture illicit fentanyl and deliver the final product. U.S. law enforcement has seen a growing trend of Chinese nationals, in both Mexico and the United States, working with Mexican cartels. As Chinese suppliers coordinate more with international partners, the DEA is concerned that fentanyl production is becoming increasingly global and more difficult to track and control.
  • Chinese brokers are laundering Mexican drug money through China’s financial system: Chinese money launderers are using financial technology, mobile banking apps, and social media to evade authorities.
  • Cooperation between the United States and China remains limited: U.S. law enforcement agencies have established working groups, conducted high-level meetings, and shared information with their Chinese counterparts, which has led to the dismantling of a few illicit fentanyl networks. At the same time, U.S. authorities are reporting that cooperation remains limited on the ground. The Chinese government has cooperated less with U.S. authorities on criminal and money laundering investigations, conducting joint operations, and U.S. requests for inspections and law enforcement assistance. 

Please visit NIDA (the National Institute on Drug Abuse) for facts about Fentanyl.

Photo by DEA

Robotics Patent Landscape Using trends in robotics patent families published from China as a measure of robotics advancement, the report finds that China is well on its way to emerge as a world leader in robotics. Since 2011, China has dramatically grown its robotics sector as part of its mission to achieve technological leadership. To support this national strategic endeavor, the Chinese government has encouraged growth through incentives and, in some cases, subsidies. Patents in robotics have surged, particularly at Chinese universities; by contrast, private companies comprise the bulk of robotics patent filers around the world. China has also seen a corresponding growth in robotics purchasing and active robotics stock. This CSET report offers a high-level analysis supported by intriguing data findings on the current state of China’s robotics patents. 

The Export Edition: what does China need from the West? Amid all the discussion of reshoring and fears of dependency on Chinese-made technologies and products, it’s easy to overlook just how much China relies on the West. And, spoiler alert, it’s not a fan of said vulnerabilities, according to R Street. Chief among those weaknesses is China’s ability to produce advanced semiconductors or microchips, which lags several years behind that of the United States. The United States has already exploited that shortcoming—particularly during the Trump administration, which cut off chip sales to Chinese champion Huawei. China is working hard to close that gap. But the process is far from straightforward, given the complexity and cost of designing and manufacturing chips; the chokehold that the West has on the incredibly sophisticated tools it takes to make cutting-edge chips; and seemingly settled the nature of the semiconductor market. The long and short of this is that we will continue to see some serious bickering between China and the West, and within the West, over who gets to invest in—and own—the companies that make semiconductor chips and manufacturing equipment. For more: R Street’s Policy Director recently spoke at the Internet Governance Forum on how to foster interoperability, strengthen our supply chains and close our own gaps. And here’s a piece from our friends at the Foundation for Defense of Democracies making the case that the United States needs to act now to maintain its advanced chipmaking dominance.

Ending Human Trafficking in the Twenty-First Century The authors of the new CFR report argue that human trafficking bolsters abusive regimes and criminal groups, weakens global supply chains, fuels corruption, and undermines good governance. They urge the United States to increase investment in anti-trafficking measures. 

Climate Change and Security in the Arctic report by the Center for Climate and Security (CCS), an Institute of the Council on Strategic Risks (CSR), together with the Norwegian Institute of International Affairs (NUPI), assesses the growing security risks posed by a warming climate in one of the most rapidly changing regions on Earth: the Arctic. The report concludes that the risks posed by uncurbed warming include the potential for new conflicts, the breakdown of multilateral cooperation, and rising great power tensions. The analysis looks at two future warming scenarios (curbed and uncurbed) to project security threats alongside potential environmental changes deemed likely in the High North by 2030.
The analysis identifies a number of key Arctic climate security risks across both warming scenarios, but notes that the risks are more severe and more likely in an “uncurbed” warming scenario. In a “curbed” scenario in which the world takes rapid action to curb climate change, including by transforming energy use, decarbonizing the global economy, and building international institutions to manage climate risks, the Arctic is likely to see fewer opportunities for severe security risks. The report recommends integrating this climate risk analysis into Arctic planning strategies into the coming years, and avoiding the uncurbed warming scenario. Specifically, the analysis highlights five key findings:

  • A warmer and increasingly navigable Arctic will lead to more commercial, civilian, and military activity, rendering the region more prone to accidents and misunderstandings between major players.
  • Increased commercial activity significantly expands the likelihood of states like Russia and China using civilian and commercial actors as vehicles for strategic positioning, dual-use data collection, and for gray zone operations which may escalate to direct confrontation.
  • The institutions that have helped depoliticize and produce stability in the Arctic for several decades may not have sufficient mandates and authorities, or be resilient enough to withstand new demands resulting from climate change.
  • To manage a more complex operating environment in the Arctic, with ever more state and non-state actors, governments will need an integrated toolbox that includes legal, economic, diplomatic, and military instruments. Robust mechanisms for cooperation and communication with civilian and commercial actors will be particularly useful.
  • States are likely to place higher demands on their military forces in the Arctic, particularly as regards to monitoring, assertions of sovereignty, search and rescue, and other Coast Guard duties given higher levels of overall activity in the region. New climatic realities may also reduce the constraints for force projection in the region. At the same time, over-reliance on military approaches in the region could risk escalating conflicts.

Camille Seaman

To build resilience to the above threats, the report recommends that allied Arctic nations begin to advance the elaboration of a “Military Code of Conduct for Arctic Forces,” or other form of renewed dialogue among regional security actors, to address joint security risks. Highlighting the findings of the report, its authors stated:

  • “The Arctic is a critical region where the consequences of climate change could quickly multiply into a host of other severe security risks: dangerous conditions, potential for accidents, gray zone warfare, and even great power conflict. We need to  increase the capacity of institutions in the region to moderate growing tensions,  reduce the risks of increasing climate and political instability, and reign in global emissions to prevent further escalation.
  • “It’s clear from this analysis that while relations in the Arctic are already quite tense, further climate change will only make the security situation more dire. On the other hand, global cooperation towards global net zero commitments and addressing climate security risks through new institutions could have immense benefit for ensuring peace and security in the region and between major powers.”
  • “The difference between a low or high emissions scenario will be the difference between a changed world to which states can adapt or a world in which states are continuously scrambling to keep up with escalating and destabilizing change, and potentially losing legitimacy in the process. Climate change– in the Arctic and elsewhere– poses unprecedented risk but also unprecedented opportunity for international collaboration on a shared security concern.”
  • “Climate changes introduce a broader range of risks in the Arctic, which add to the military risks that are already there. Existing institutional frameworks, and policy responses need to be expanded and adapted to this new reality.” 

China’s Cyber AI Talent Pipeline To what extent does China’s cultivation of talent in cybersecurity and AI matter in terms of competitiveness with other countries? Right now, it seems to have an edge: China’s 11 World-Class Cybersecurity Schools offer more classes on artificial intelligence and machine learning than do the 20 U.S. universities certified as Centers of Academic Excellence in Cyber Operations. This policy brief recommends tracking 13 research grants from the National Science Foundation that attempt to integrate AI into cybersecurity curricula. Read the CSET Policy Brief. 

Rethinking Research Security In an opinion piece for Lawfare, the authors argue that the U.S. Department of Justices’ China Initiative is counterproductive to U.S. innovation and offer recommendations to improve research security. See original article.

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