China syndrome // Ben FrankelChina bravely denies space espionage charges

Ross Perot, the cranky third-party candidate in the 1992 presidential election, used a colorful phrase to explain his opposition to the North America Free Trade Agreement (NAFTA) which was then being debated: if the agreement were ratified, he said, we would hear a “giant sucking sound” as good American jobs left the United States for Mexico. The giant sucking sound Perot described is merely a purr compared to the ear-splitting, deafening sucking sound of U.S. and European military, scientific, and industrial secrets being sucked, Hoover-like, by a vast, well coordinated Chinese campaign to short-cut China’s path to global political and economic hegemony.

There is nothing new about countries spying on each other, but the sheer scope and depth of the Chinese effort are unprecedented. Two characteristics make the Chinese espionage campaign different. First, there is an unprecedented synergy and coordination between Chinese military and intelligence organizations, on the one hand, and private Chinese companies, on the other hand. The Chinese government is using its vast intelligence resources to engage in industrial spying on behalf of Chinese companies, at the same time that Chinese companies and their representatives steal industrial and technological secrets from U.S. and European companies on behalf of the Chinese intelligence services (see 3 December 2007 HS Daily Wire story, in which we reported that the director-general of MI5 sent letters to 300 British companies warning them that their computer systems are under sustained attack from Chinese intelligence services; he warned these hi-tech companies that China engages in a systemic campaign to steal Western industrial secrets — and provide information to Chinese companies about Western companies with which these Chinese companies are doing business).

The second characteristic benefiting this broad Chinese espionage campaign is the large Chinese expatriate community. Millions of Chinese live outside of China. Some have done so for decades, others are new arrivals and graduate students in universities. The overwhelming majority of them are loyal citizens of their adoptive countries, and honest visitors during their stay, but a few use the high positions they attained in government and the private sector to spy for China. Some are “sleepers” who were sent to the West by Chinese intelligence years ago in order to infiltrate government institutions and private companies; some spy out of genuine patriotism and loyalty to the old country; others do it for money; others yet do so because their relatives in China are threatened. Regardless of the motive, Chinese intelligence has at its disposal a large and capable diaspora from which to recruit operatives.

This rumination about Chinese is occasioned by the story that China yesterday denied it had illicitly sought technical data for space launch vehicles from the United States, after a physicist from Virginia pleaded guilty to exporting the information to China illegally. The U.S. Justice Department said on Monday that Shu Quan-Sheng, 68, a naturalized U.S. citizen born in China, entered the guilty plea in federal court in Norfolk, Virginia. Shu admitted that from 2003 through October 2007 he violated the U.S. arms export control law by providing China with assistance in the design and development of a cryogenic fueling system for space launch vehicles. He admitted that in 2003 he violated the same law by exporting to China military technical data from a document about designing and making a liquid hydrogen tank and various pumps, valves, filters and instruments.

Chinese Foreign Ministry spokesman Qin Gang dismissed the case — and Shu’s admission. “The so-called (allegation) of China stealing space technology from the United States is sheer nonsense,” Qin told a regular news briefing. “It has ulterior motives, which will not be successful,” he added, without elaborating.

Shu also pleaded guilty to offering bribes of nearly $190,000 to Chinese government officials to win the award in 2007 of a $4 million contract for a hydrogen liquefier project for a French company Shu represented, the U.S. Justice Department said. Sentencing for Shu was set for 6 April. He faces up to 10 years in prison on each of the export violations and up to five years for violating the foreign corrupt practices law, department officials said.