China Caucus Blog

Posted by The Congressional China Caucus | November 04, 2014

Hagel Puts Off High-Profile Trip to Vietnam and Myanmar. Secretary of Defense Chuck Hagel's upcoming and highly anticipated trip to Myanmar and Vietnam has been postponed, according to a defense official, potentially fueling regional fears that Washington is turning its back on Asia to focus more on Europe and the Middle East. The trip has been pushed back to early next year because the 10-day-long trip clashed with planned congressional hearings, one defense official said. Hagel was set to travel to the region in mid-November. The visit to Vietnam also was of personal significance to Hagel -- who was wounded in the war there -- and he didn't want the trip there to be overtaken by the ongoing crisis in Iraq and Syria, the official said. It's not clear why the defense secretary made the decision to push off the trip now given that the fight against the Islamic State has been raging for many months. The cancellation comes as American allies in the region are growing increasingly concerned that the administration's long-planned pivot to Asia has stalled. Writing for Foreign Policy in 2011, then-Secretary of State Hillary Clinton announced that the United States would shift its foreign affairs focus from Iraq and Afghanistan and toward the Far East. "One of the most important tasks of American statecraft over the next decade will therefore be to lock in a substantially increased investment -- diplomatic, economic, strategic, and otherwise -- in the Asia-Pacific region," Clinton wrote. However, after the article was published the political fight over Obamacare kept the president's attention at home. On the foreign-policy front, Obama is now consumed with the fight against the Islamic State, keeping his attention in Syria and Iraq. In the past, the Pentagon has taken steps toward refocusing on the Asian Pacific. High-ranking defense officials, including Hagel and Joint Chiefs Chairman Gen. Martin Dempsey, have both visited Vietnam. Secretary of State John Kerry has also paid more diplomatic attention to the region during the president's second term. However, as China became embroiled in a number of territorial disputes with neighbors this past summer, leaders of American allies in the region began loudly calling on the White House to do more. Vietnamese Prime Minister Nguyen Tan Dung, for instance, asked the United States to provide a "stronger voice" against China after confrontations between coast guard vessels near a Chinese oil rig located in contested waters off the coast of Vietnam. http://thecable.foreignpolicy.com/posts/2014/11/03/hagel_puts_off_high_profile_trip_to_vietnam_and_myanmar

China Echoes U.S. Warning on North Korea’s Nuclear Warheads. China and South Korea joined Friday in warning of North Korea’s advances in nuclear technology that the U.S. commander in South Korea has said could include the miniaturization of a weapon for a missile warhead. After talks in Beijing, the nuclear envoys of China and South Korea agreed to cooperate in efforts to rein in North Korea’s nuclear weapons programs, South Korea’s Yonhap news agency reported. “We exchanged deep concern about North Korea’s advances of nuclear and missile capabilities and, with a sense of urgency, agreed to continue to make close cooperation to curb such advances,” Hwang Joon-kook, South Korea’s chief nuclear envoy, told reporters. Hwang’s comments after meeting with his Chinese counterpart, Wu Dawei, came a week after Army Gen. Curtis “Mike” Scaparrotti warned of the possibility that North Korea had the capability to miniaturize a nuclear weapon for a missile nosecone. “I believe they do” know how to make a small warhead, said Scaparrotti, commander of U.S. Forces Korea and the Korea-U.S. Combined Forces Command. “I’m not saying that I know that by any factual basis, but I believe they probably have the background to do this,” Scaparrotti said at a Pentagon briefing. “I’m just saying as a commander, I’ve got to assume they have the capabilities to put it together,” Scaparrotti said. “We’ve not seen it tested at this point and as you know, for something that complex, without it being tested, the probability of it being effective is pretty darn low.” However, the ability to reduce the size and weight of a nuclear weapon to fit inside a ballistic missile warhead required advanced testing and exacting engineering, and it was doubtful that North Korean technicians were close to attaining those goals, according to nuclear weapons specialists. http://defensetech.org/2014/11/03/china-echoes-u-s-warning-on-north-koreas-nuclear-warheads/

Japan Warns China Coral Poachers. Top Japanese officials on Tuesday warned coral poachers to stay out of the country’s territorial waters after arresting six Chinese nationals suspected of hunting illegally for precious red corals in recent weeks. Foreign Minister Fumio Kishida told reporters Tuesday that a large fleet of Chinese ships have been spotted since mid-September—a total of over 200 ships at the end of October in or near Japanese waters. Mr. Kishida requested an “appropriate and effective response” from Beijing, adding that “China has expressed its awareness of the gravity of the matter.” The deep-red Japanese corals are highly prized in China where they are worn as jewelry, and can fetch as much as ¥180,000 ($1,578) per gram, according to the Mainichi Shimbun daily. The cat-and-mouse chase between Chinese fishermen and Japanese coast guard officials comes at a precarious time, as the leaders of Asia’s two largest economies prepare to hold their first one-on-one session on the sidelines of a regional summit meeting in Beijing starting Monday. According to the Yokohama Coast Guard Office that oversees waters around the Pacific Ogasawara islands about 1,000 kilometers south of Tokyo, five Chinese boat captains have been arrested on the suspicion of violating fishing laws in October on separate occasions in either Japan’s territorial waters or an exclusive economic zone in the area. Another Chinese skipper was arrested on Oct. 17 in an EEZ off Ishigaki, one of Japan’s southernmost islands near a group of islands contested by both Japan and China. All but one have been released after paying—or promising to pay—an undisclosed penalty fee. Beijing doesn’t make sovereignty claims over the waters where poachers have been arrested. China’s foreign ministry spokeswoman Hua Chunying asked Japan on Monday to “deal with relevant issues in a civil, sensible, law-abiding, just and proper way.” She also asked the Chinese fishermen “to carry out production and operation at sea in accordance with the law.” http://online.wsj.com/articles/japan-warns-china-coral-poachers-1415098880

China Airshow Will Unveil J-31. A Chinese airshow official has confirmed that China will unveil its stealthy J-31 fighter aircraft at China’s biggest commercial and defense airshow next week in Zhuhai, in the southern province of Guangdong near Hong Kong. Known officially as the 10th China International Aviation and Aerospace Exhibition, the event will be held from Nov. 11-14. About 700 aviation companies and 120 aircraft will participate. Built by Shenyang Aircraft, this will be the first public demonstration of the twin-engine J-31. The fighter is similar in configuration to the single-engine Lockheed F-35 stealth fighter. Chinese-language military blogs posted photographs of the J-31 practicing demonstration flights at Zhuhai last week. The People’s Liberation Army Air Force (PLAAF) will be exhibiting the JH-7A and J-10 fighters, Z-8KA helicopter, and the upgraded H-6M medium-range bomber capable of carrying cruise missiles. The Hongdu L-15 Falcon fighter trainer is not yet listed nor is there a press conference. Hongdu has made a special effort at other air shows in the Middle East and Asia to promote the aircraft. There is also no listing for the Pakistan-built JF-17 fighter, which was at the 2012 airshow. However, Aviation Industry Corporation of China (AVIC) will exhibit the FC-1 fighter, which is a Chinese variant of the JF-17. The fighter is a joint program by Chengdu Aircraft and the Pakistan Aeronautical Complex. The Russian-built Su-35 super-maneuverable fighter will be on display for the first time. China and Russia have been in negotiations for a deal on the fighter since 2006 and a signing may be possible in late November. “As far as I understand now, there will be a contract for 24 aircraft plus some spare engines,” said Vassily Kashin, an expert on Russia’s arms trade with China at Moscow’s Centre for Analysis of Strategies and Technologies. “The negotiations on engine technology transfers are progressing separately, that is a different cooperation area.” http://www.defensenews.com/article/20141103/DEFREG03/311030009/China-Airshow-Will-Unveil-J-31

Hong Kong Government Supporters Grow Impatient With C.Y. Leung. Six weeks into pro-democracy protests, cracks are beginning to show among supporters of the government. The split is largely focused on the leadership of Hong Kong Chief Executive Leung Chun-ying , who has failed to come up with a strategy to end the standoff and made statements that have angered city residents, both protesters and non-protesters. Those who have publicly disagreed with the government include the head of the city’s legislature, the leader of a pro-Beijing labor union and the head of a pro-business political party who was ousted from his position on an influential Beijing body for demanding the resignation of Mr. Leung, known by his initials, C.Y. “In the longer term, as C.Y. becomes increasingly unpopular, I think the resistance against him might grow louder,” said Ma Ngok, an associate professor of political science at the Chinese University of Hong Kong. Mr. Leung stepping down is one of the main demands of the protesters, who are fighting for the right to nominate candidates for chief executive in 2017. Beijing has agreed to universal suffrage for the election but says candidates must be approved by a largely pro-Beijing, pro-business nominating committee. The leaders of the protest have had disagreements as well, while some people on the streets say they don’t follow any of the three groups leading the occupation. A widening gap is emerging between students and pro-democracy lawmakers on the next steps for the protests. Hong Kong’s pro-establishment parties range from grass roots organizations representing rural residents to supporters of big business. In practice they have little in common ideologically apart from loyalty to Beijing. http://online.wsj.com/articles/hong-kong-government-supporters-grow-impatient-with-c-y-leung-1415099882

Posted by The Congressional China Caucus | November 03, 2014

U.S. Blocks China Efforts to Promote Asia Trade Pact.  The U.S. has blocked China’s efforts to use a leaders’ summit to begin negotiations on a free-trade zone spanning the Pacific, people close to the matter said, as the world’s two largest economies tussle over influence in the region and billions of dollars in trade. China, the host of this year’s Asia-Pacific Economic Cooperation forum on Nov. 10-11, has sought to highlight its expanding international role by pressing for a pact known as the Free Trade Area of the Asia Pacific. Beijing’s free-trade zone has been on the agenda of APEC for years—and was initially pushed by the U.S.—but has been relegated to the back burner as the U.S. has poured its efforts into the Trans-Pacific Partnership, a trade pact it is negotiating with 11 nations that include Japan but not China. For Beijing, the FTAAP would offer a way to ensure that it continues to get preferential access to some of its largest trading partners. A TPP deal would cost China about $100 billion a year in lost exports as the partners trade more among themselves and less with China, according to an estimate by the Peterson Institute for International Economics, in Washington. “China wanted to reinvigorate” FTAAP, said Alan Bollard, executive director of APEC, an association of 21 economies including the U.S., China, Russia and Japan, whose leaders meet annually and whose decisions are taken by consensus. The APEC leaders’ summit next week will be the first major international conference held in Beijing since Xi Jinping took power as Communist Party chief. Under U.S. pressure, Beijing dropped two provisions from the draft of an APEC communiqué to be released at the end of the leaders’ session, negotiators said. The statement no longer calls for an FTAAP “feasibility study”—trade lingo for starting negotiations—and has no target date to finish the deal. China wanted 2025 as an end date. A U.S. Trade Representative spokesman said the U.S. and China are working on a “constructive proposal” for how APEC can further FTAAP under what the spokesman called a “long-term vision” that builds on other trade deals. http://online.wsj.com/articles/u-s-blocks-china-efforts-to-promote-asia-trade-pact-1414965150

For Obama And Xi, Fight Against Islamic State A Brief Moment To Agree. When the United States and China discuss cooperating against Islamic State later this month, the most prominent outcome is likely to be less criticism of each other's anti-terrorism policies. Both countries have flagged that President Barack Obama and President Xi Jinping will discuss the issue when they meet on the sidelines of the Asia Pacific Economic Cooperation (APEC) summit in Beijing. Cooperation like sharing intelligence will be difficult. And China will not commit troops or weapons. But simply seeing eye-to-eye on the problem of Islamic State can pay political dividends, experts and diplomats say, as the United States launches air strikes against the ultra-radicals in Iraq and Syria and China faces condemnation of its hardline tactics in its western Xinjiang region. "You're mostly likely to see China sit back and not criticize the United States. That is what cooperation looks like," said Philip Potter, an assistant professor at the University of Virginia who studies global terrorism. In return, Beijing would value more recognition from Washington of what Chinese authorities say is the threat of militant Islamic separatists in its far western province of Xinjiang. China charges that a group called the East Turkistan Islamic Movement (ETIM) is seeking to set up a separate state in Xinjiang, home to the Muslim Uighur ethnic minority. Rights groups and Uighur exiles dispute the extent of the ETIM threat, and argue that economic marginalisation of Uighurs is one of the main causes of violence there. Washington deemed ETIM a terrorist organization in the wake of the September 11, 2001 attacks, but a few officials in the U.S. government have privately questioned the extent of the organization's influence in Xinjiang. However, some experts note that the United States' rhetoric on the group may be swinging back in favor of Beijing. http://www.reuters.com/article/2014/11/02/us-china-usa-islamicstate-idUSKBN0IM03420141102

U.S. Pacific Air Force Chief Says Wary Of Risky Flying By China Jets. The U.S. is concerned Chinese jets may engage in further risky intercepts of its military aircraft, even after starting talks aimed at avoiding such encounters, the new commander of U.S. air forces in the Pacific said. A Chinese fighter jet flew within 20 feet of a U.S. P-8 Poseidon aircraft flying at more than 400 miles an hour near Hainan Island – China’s gateway to the contested South China Sea – on Aug. 19, an encounter that the Pentagon described as “unsafe and unprofessional.” “I never say never,” General Lori Robinson, 55, said when asked if talks meant such behavior would cease. “What’s important is that we do start the dialogue and that we do come to an understanding of what a traditional intercept is.” Robinson replaced General Herbert “Hawk” Carlisle as commander of Pacific Air Forces on Oct. 16. Though she has no specific meetings scheduled, she said she hopes to discuss air safety when she meets Chinese military personnel at the Zhuhai air show in Guangdong and a training conference this month. The aim is for China to agree to abide by intercept procedures outlined by international standards, she said. The air force has no plans to change how it conducts its missions in the region, said Robinson, who has more than 900 flying hours and was promoted to the rank of four-star general when she replaced Carlisle. Robinson, who joined the Air Force in 1982, is the first woman to have an Air Force command. She was previously vice commander of the air combat command at the Langley Air Force Base in Virginia, according to her Air Force biography. http://www.bloomberg.com/news/2014-11-01/pacific-air-force-chief-says-wary-of-risky-flying-by-china-jets.html

5 National Security Priorities for Congress. Whatever the result of Tuesday’s midterm elections, the fundamental dynamics in Washington are unlikely to change. Neither party will have 60 votes in the Senate, the House GOP will still contain divided factions and the president will surely continue to focus on solidifying his major legislative accomplishment in Obamacare. While more bills may move in a Republican Congress, the same amount is likely to be signed into law as the last session either way. Keeping these limiting realities in mind, there will still be pressing national security issues demanding Congress’ attention during the lame duck and the new session in January. The following are five things Congress could and should do to promote a stronger national defense in the near future. http://www.usnews.com/opinion/blogs/world-report/2014/11/03/5-national-security-priorities-after-the-2014-elections

Canada’s Prime Minister to Travel to China Next Week to Meet Xi Jinping. Canadian Prime Minister Stephen Harper said Friday he would travel to China next week for a meeting with Chinese President Xi Jinping , which comes as tensions mount between the two countries over issues such as energy investment and allegations of cyberattacks. Earlier this week, Mr. Harper canceled a visit to China for a summit of leaders from Pacific-Rim economies scheduled to start Nov. 11. The rescheduled trip, which will unfold between Nov. 5 and Nov. 10, marks Mr. Harper’s return to China for the first time since early 2012, when the Canadian leader visited the country to help boost economic ties with the world’s second-largest economy. Since then, relations between Canada and China have cooled, with Beijing unhappy about foreign-investment rules that Chinese officials claim unfairly target Chinese state-owned energy companies. Those rules—which bar state-owned enterprises from acquiring control of oil-sands assets except in extraordinary circumstances—were introduced after Canada allowed Beijing-controlled Cnooc Ltd.’s $15 billion purchase of Nexen Inc. in December 2012. China has invested tens of billions of dollars over the past half-decade in Canadian energy, with the bulk of those deals involving large state-owned enterprises such as Cnooc, China National Petroleum Corp., or PetroChina , and China Petroleum & Chemical Corp. , known as Sinopec. http://online.wsj.com/articles/canadas-prime-minister-to-travel-to-china-next-week-to-meet-xi-jinping-1414775752

China successfully develops drone defense system: Xinhua. China has successfully tested a self-developed laser defense system against small-scale low-altitude drones, state media said on Sunday. The laser defense system is capable of shooting down small aircraft within a two-km (1.2-mile) radius and can do so within five seconds of locating its target, the official Xinhua news agency said, quoting a statement by the China Academy of Engineering Physics. The academy is one of the drone defense system's co-developers, Xinhua said. The reported development comes as concerns about the country's military preparedness are being raised in state media. A front page article in China's official military newspaper last month said that weaknesses in military training posed a threat to the country's ability to fight and win a war. The paper - the People's Liberation Army (PLA) Daily - said in the same report that China's military authorities had sent a document out to units detailing 40 weaknesses in current training methods. President Xi Jinping has been pushing to strengthen the fighting ability of China's 2.3 million-strong armed forces as they project power across disputed waters in the East and South China Seas. China has developed stealth jets and has built one aircraft carrier. http://www.reuters.com/article/2014/11/02/us-china-defence-idUSKBN0IM0LW20141102

China's Xinhua pours cold water on idea of Xi-Abe talks. China's official Xinhua news agency on Monday poured cold water on the idea that the leaders of China and Japan could have formal talks on the sidelines of next week's Asia Pacific Economic Cooperation (APEC) summit. Expectations have been growing in Japan for Prime Minister Shinzo Abe to meet Chinese President Xi Jinping for an ice-breaking chat at the gathering of Asia-Pacific leaders. A meeting of the two leaders would be a symbolic breakthrough in ties between the world's second- and third-biggest economies, which have turned frigid in the past two years over a territorial row, regional rivalry and the bitter legacy of Japan's wartime occupation of China. Abe had "spared no efforts" in seeking to meet with Xi, Xinhua said in an English-language commentary. "His wish will be fulfilled, since Beijing, the host of this forum, will undoubtedly receive the Japanese leader with etiquette and hospitality, despite chronic territorial rows and a historical feud with Tokyo," it said. "However, that does not necessarily mean Abe's long-sought formal talks with Xi during APEC would come true, which demands Abe extend good faith and take real action to create the proper atmosphere." But Japan has not made such efforts in bilateral ties, which have been constantly troubled by its attempts to wash off its war-time atrocities, Xinhua added. Xinhua commentaries are not official government pronouncements, but can be read as a reflection of official thinking. The commentary said that though bad ties benefited neither country, Japan had "launched a string of provocations" last month, including visits by government ministers to the Yasukuni Shrine, which China sees as a symbol of Japan's past militarism. http://www.reuters.com/article/2014/11/03/us-china-apec-japan-idUSKBN0IN0OQ20141103

The Caucus Brief is a daily publication for Members of Congress and Hill Staffers on China news and information compiled by the office of Congressman Randy Forbes, Founder of the Congressional China Caucus.  Email christian.goodman@mail.house.gov with tips, comments, or to subscribe/unsubscribe.

Posted by The Congressional China Caucus | October 30, 2014

China’s Submarine Fleet Takes Historic Steps Forward. China’s submarine fleet made its first known trip into the Indian Ocean, according to a report by the Wall Street Journal. A Chinese attack submarine passed through the Straits of Malacca between Malaysia and Indonesia with sightings near Sri Lanka and the Persian Gulf. It’s the latest report of the significant steps forward the Chinese navy has taken in advancing its submarine fleet. Earlier this year, a U.S. Navy report estimated that the Chinese navy has nuclear-armed ballistic missile submarines able to launch strikes against the United States from the middle of the Pacific Ocean. The Chinese navy has ambitious plans over the next 15 years to rapidly advance its fleet of surface ships and submarines as well as maritime weapons and sensors, according to a report by the Office of Naval Intelligence. Earlier this year, ONI issued an assessment on the Chinese navy as part of testimony to the U.S. China Economic and Security Review. ONI leaders found that China’s navy has evolved from a littoral force to one that is capable of meeting a wide range of missions to include being “increasingly capable of striking targets hundreds of miles from the Chinese mainland.” The Chinese navy has 77 surface combatants, more than 60 submarines, 55 amphibious ships and about 85 missile-equipped small ships, according to the report first published by the U.S. Naval Institute. http://defensetech.org/2014/10/29/chinas-submarine-fleet-takes-historic-steps-forward

U.S. Think-Tank: North Korea Researching Sea-Based Missiles. North Korea has built a test facility that may be intended to develop a marine-based ballistic missile using submarines or surface vessels, a U.S. think-tank said Tuesday. While submarines carrying ballistic missiles could provide North Korea with a survivable second-strike nuclear capability, the U.S.-Korea Institute at Johns Hopkins University stressed that Pyongyang was likely “years” from achieving the required technology. Reviewing recent commercial satellite imagery, the institute said a new test stand was identified at the Sinpo South Shipyard in northeastern North Korea. The size and design of the stand suggested it was intended “to explore the possibility of launching ballistic missiles from submarines or of a shipboard vertical launch ballistic missile capability,” it said in an analysis on the closely followed 38 North website. The analysis said it was difficult to speculate what kind of missile system the North might use on a submarine-based system, noting that existing large, liquid-fueled missiles like the medium-range Musudan and Nodong would be difficult to adapt. A naval version of existing short-range Scud missiles or an entirely new system might present less of an engineering challenge, but whatever system is chosen, “it is likely to take years to design, develop, manufacture, and deploy,” it added. Despite those caveats, the prospect of a second-strike capability – the ability to survive an initial nuclear attack and hit back – will only fuel concerns about the pace of North Korea’s nuclear weapons development. Last week, the commander of U.S. forces in South Korea, Gen. Curtis Scaparrotti, said the North had progressed to the point where it could probably miniaturize a nuclear device to be fitted on the tip of a missile. http://www.defensenews.com/article/20141029/DEFREG03/310290035

United States praises China's growing role in Afghanistan. The United States welcomed China's growing role in trying to ensure Afghanistan's stability on Thursday, saying a Beijing conference of foreign ministers on Afghan reconstruction this week shows its commitment to the region as Western troops pull out. The comments, made by a senior State Department official, are rare U.S. praise for Beijing, which this week hosts Afghan President Ashraf Ghani on his first visit abroad since assuming office in September. Washington and Beijing, which have typically contentious relations on geopolitical issues from Iran to the South China Sea, have both said they see Afghanistan as a point where their security interests converge. On Tuesday, China pledged to give Afghanistan $327 million in aid through 2017, more than the $250 million contribution it has so far offered since the fall of the hardline Islamist Taliban regime in 2001. "China's view of engaging in Afghanistan over the course of these past few years has really changed significantly, and in our view, in a very positive direction," the official told reporters during a telephone briefing. On Friday, foreign ministers from Asian and Central Asian countries will gather in Beijing for a fourth round "Istanbul Process" conference on Afghanistan, which China hopes will help boost development and security there. White House counsellor John Podesta will attend the meeting. http://www.reuters.com/article/2014/10/30/us-usa-china-afghanistan-idUSKBN0IJ0C120141030

Hong Kong democracy stalwart says 'foreign forces' not behind protests. China’s attempt to blame U.S. and other “foreign forces” for Hong Kong’s protests is merely a “convenient excuse” for Beijing to cover its shame for not granting the territory true democracy as it once promised, said Martin Lee, founding chairman of Hong Kong's Democratic Party. With street sit-ins entering their second month and no resolution in sight, Lee, 76, said Tuesday that responsibility for ending the ongoing protests rests on the shoulders of Chinese President Xi Jinping, who recently has emphasized the necessity of the “rule of law.” Lee, founder of one of Hong Kong's largest political parties, has been singled out by China’s Communist Party for allegedly inviting outside interference in the territory's affairs. In April, the U.S. Congress revived an annual report on political developments in Hong Kong following a plea by Lee and former Chief Secretary Anson Chan. They have since been condemned in China’s state-run media as "betraying" Hong Kong with their move. Protesters in Hong Kong, a former British territory that returned to Chinese rule in 1997 under a framework known as “one country, two systems,” took to the streets in late September to denounce rules laid out by Beijing for the city’s chief executive election in 2017. The rules would limit candidates to two or three people approved by a special committee expected to be packed with pro-establishment figures. http://www.latimes.com/world/asia/la-fg-hong-kong-democracy-lee-20141029-story.html

China calls on Japan to end jet scrambles. China called on Japan on Thursday to stop scrambling its jets against Chinese aircraft following a rise in the number of such operations, saying it was source of flying safety concerns. Tension has been high between Asia's two largest economies in recent months, with each accusing the other of flying military aircraft too close to its own jets in a long-running territorial dispute. Both sides claim a string of Japanese-administered islets in the East China Sea, known as Senkaku in Japan and Diaoyu in China. Beijing declared an air defense zone covering most of the East China Sea last year, sparking protests from Japan and the United States. Japan's fighter jet scrambles against Chinese planes rose 29 percent to 103 in July-September, accounting for more than half of Tokyo's total scrambles in the three-month period, data from the country's Defense Ministry shows. Chinese Defense Ministry spokesman Yang Yujun said Beijing had noticed these numbers. http://www.reuters.com/article/2014/10/30/us-china-japan-idUSKBN0IJ0SN20141030

‘No one has the guts to sell submarines to Taiwan’ as China pressures Pentagon. The Obama administration is backing away from a 2001 commitment to help Taiwan acquire submarines to defend the island from Chinese attack. The Pentagon, in particular, is said to oppose the 13-year-old plan to help Taipei buy or build eight diesel electric subs over concerns of disrupting its high-priority military exchange program with China. The Chinese military cut ties to the Pentagon several times in recent years to protest U.S. arms sales to Taiwan, and agreed to resume exchanges only if the administration adopted China’s concept of “new-type” relations that, for Beijing, includes gradually ending arms sales to Taiwan. The administration, however, is bound by the 1979 Taiwan Relations Act to provide defensive arms to Taiwan to prevent a Chinese takeover. The U.S. military has been pressing Taiwan in recent months to do more to increase its defenses in the face of a large-scale buildup of warships, submarines, missiles and amphibious forces by China’s People’s Liberation Army. The PLA has deployed more than 1,200 missiles within range of Taiwan that could devastate the island in a surprise attack. http://www.washingtontimes.com/news/2014/oct/29/inside-the-ring-taiwan-submarine-plan-sinks-as-pen/

Satellite Photos Show N. Korean Test Stand for Submarine Missile. Satellite images of a North Korean submarine facility show what appears to be a missile tube being developed for a future ballistic missile submarine. The commercial imagery was disclosed Tuesday in an article published Tuesday by the group 38 North. The photos show was appears to be a test stand for a submarine-launched ballistic missile. “A review of commercial satellite imagery since 2010 covering submarine bases and submarine shipyards has identified a new test stand at the North’s Sinpo South Shipyard, probably intended to explore the possibility of launching ballistic missiles from submarines or of a shipboard vertical launch ballistic missile capability,” wrote Joseph S. Bermudez Jr., a North Korea expert with AllSource Analysis, Inc. The imagery obtained from DigitalGlobe, Inc. confirms a report first disclosed by the Free Beacon in August that North Korea was working to develop a submarine capable of launching ballistic missiles, potentially increasing the nuclear threat from the reclusive communist state. U.S. intelligence agencies first reported the North Korean submarine missile development in internal reports last summer and the reports were later confirmed by South Korea’s military. According to 38 North, “the new installation is the right size and design to be used for the research, development, and testing of the process of ejecting a missile out of a launch tube as well as evaluating its compatibility with submarines and surface combatants as well as the missiles themselves.” The report said a future North Korean missile-firing sub would give Pyongyang a survivable second-strike nuclear capability. http://freebeacon.com/national-security/satellite-photos-show-n-korean-test-stand-for-submarine-missile/

Posted by The Congressional China Caucus | October 29, 2014

Beijing Zeroes In on Energy Potential of South China Sea. For the past several years, China has been throwing its weight around the South China Sea, a body of water studded with coral reefs that laps at the shores of not only China but also Vietnam, Malaysia, the Philippines, Brunei and Taiwan. China has sent ships to stake claims across the area, notably when a flotilla that included the country’s most advanced amphibious assault vessel arrived at James Shoal, 50 miles east of Malaysia’s coast, in 2013. Much of this muscle-flexing is political. China is a rising power and the South China Sea is a logical place for it to exercise its growing strength. The sea is a vital freight lane, through which a third of global shipping traffic passes. It is also a main focus of geopolitical jockeying for both Beijing and the United States, which has been strengthening its relations with the Philippines, Malaysia and Vietnam. There is another reason for China’s interest in the South China Sea: the large quantities of oil and natural gas that might lie below these waters. In May, Beijing made its interest in those resources clear when it sent a drilling rig called Haiyang Shiyou 981 into waters claimed by Vietnam. The rig is owned by China National Offshore Oil Corporation, or Cnooc, the country’s biggest offshore energy producer. http://www.nytimes.com/2014/10/29/business/energy-environment/beijing-zeroes-in-on-energy-potential-of-south-china-sea.html

China could 'punish' Hong Kong over protests, says ex-HK central bank chief. A member of China's central bank's advisory body warned on Wednesday that Beijing will punish Hong Kong if pro-democracy protests that have paralyzed parts of the Chinese-controlled financial center for a month are allowed to continue. Joseph Yam, executive vice president of advisory body China Society for Finance and Banking and a former Hong Kong central bank chief, said the city's financial integrity and stability of its currency were also at risk. "Hong Kong's economic prosperity was built on its intermediary role between the mainland and overseas, especially in the financial realm," said Yam, who urged student protesters to return to their homes. "(When) the intermediary is uncooperative, unreliable, trouble making, the mainland will for sure reduce reliance, make a fresh start at another place, have two strings to its bow and lessen preferential policies toward Hong Kong amid the economic reform process." His warning came hours before China's top parliamentary advisory body expelled Hong Kong lawmaker James Tien Pei-chun for calling on the city's embattled chief executive, Leung Chun-ying, to step down. Tien said after the news that he would resign as leader of Hong Kong's Liberal Party. Tens of thousands took to the streets at the height of the demonstrations to demand greater democracy in the former British colony, although their numbers have dwindled to hundreds in recent weeks, with tents scattered across the main protest site. The protests were triggered by China's imposition of a highly restrictive framework for a city-wide vote for its next leader in 2017, which would only allow candidates pre-screened by a 1,200-strong committee stacked with Beijing loyalists. The city's powerful tycoons had warned prior to the protests that demonstrations could threaten the city's financial stability, although they have remained largely silent since. http://www.reuters.com/article/2014/10/29/us-hongkong-china-stability-idUSKBN0II0KI20141029

China says anti-graft accord to be signed at APEC summit. Next month Asia-Pacific Economic Cooperation (APEC) summit in Beijing will agree to a deal to fight corruption, China's foreign minister said on Wednesday, appealing for more international cooperation. Chinese President Xi Jinping has launched a sweeping campaign against deep-seated graft since assuming power two years ago, but has been hampered to an extent by difficulty in getting corrupt officials and assets back from overseas. China announced in July an operation called Fox Hunt to go after dirty officials who have fled overseas with their ill-gotten gains, with Australia, a popular destination for such criminals, having already promised cooperation. Chinese Foreign Minister Wang Yi told a conference in Beijing that the anti-corruption plan was one of the agreements set to be signed at APEC, though he did not give details of its contents. http://www.reuters.com/article/2014/10/29/us-china-apec-corruption-idUSKBN0II0O820141029

Ex-General in China Admits He Took Bribes, Report Says. China’s highest-reaching military corruption scandal of recent times moved toward trial on Tuesday, when investigators announced that a retired People’s Liberation Army commander, the former Gen. Xu Caihou, had confessed to taking enormous bribes in return for giving promotions and favors. The announcement issued through Xinhua, the state news agency, also said that military prosecutors, called the military procuratorate in China, had on Monday officially finished their inquiry into Mr. Xu and were considering whether to put him on trial. That appears inevitable, given that the investigators said they concluded that he had taken “particularly huge bribes,” directly or through family members, in return for helping people win promotions or make unspecified personal gains. “Xu Caihou fully confessed to the facts of his bribetaking crimes,” said the brief Xinhua report. It did not give any details of who gave the bribes or how much Mr. Xu took. The party authorities announced in late June that he was under investigation, after a secretive inquiry begun in March. Mr. Xu has been one of the highest-ranking targets of President Xi Jinping’s campaign to rein in corruption in China. Until stepping down in late 2012, he was a vice chairman of the Central Military Commission, the Communist Party’s body for running the military, and was also on the Politburo, the elite party council with 25 members. http://www.nytimes.com/2014/10/29/world/asia/china-Gen-Xu-Caihou-peoples-liberation-army-bribes.html?_r=0

China Pledges $327 Million in Aid to Afghanistan. China has pledged two billion yuan ($327 million) in aid to Afghanistan, which is seeking new sources of foreign help amid a U.S. drawdown and increasing worries about regional instability. The offer of aid through 2017 followed a meeting on Tuesday between China’s President Xi Jinping and newly elected Afghan President Ashraf Ghani, a joint declaration published by China’s Foreign Ministry on Wednesday said. Beijing and Kabul also agreed to step up intelligence sharing to fight drug trafficking and other cross-border issues. Afghanistan’s president wants to build ties to regional powers such as China as the U.S. and its allies draw down forces. Their combat mission ends on Dec. 31. The U.S. Special Inspector for Afghanistan Reconstruction says Washington has committed more than $100 billion to state-building and development projects in Afghanistan since the collapse of the Taliban regime in late 2001. China has interests in Afghan peace, as it fears instability there could spread more broadly across the region. China and Afghanistan share a narrow, mountainous border. The Foreign Ministry quoted Mr. Xi as saying that China was willing to support Afghanistan’s new government, and would help with personnel training as well as developing agriculture, hydroelectricity and infrastructure. The ministry didn’t provide specifics. Chinese development work in Afghanistan has previously been limited by security concerns. Mr. Ghani’s visit to China is his first working trip abroad since taking office at the end of September. The Afghan president recently visited Saudi Arabia to perform umrah, an Islamic pilgrimage to the holy city of Mecca, as part of a campaign promise. http://online.wsj.com/articles/china-pledges-327-million-in-aid-to-afghanistan-1414566221

India to Supply Naval Vessels to Vietnam. India said Tuesday it plans to supply naval vessels to Vietnam—a move that could heighten tensions with China, which is clashing with Hanoi over territorial claims in the South China Sea. India’s Prime Minister Narendra Modi announced the deal Tuesday during a visit by Vietnam’s Prime Minister Nguyen Tan Dung. “We have a shared interest in maritime security,” Mr. Modi said in a statement, “including peaceful settlement of maritime disputes.” It is the latest move in a geopolitical chess game in which Mr. Modi, elected earlier this year, is trying to broaden India’s influence in Asia to counter China, its increasingly assertive neighbor. India and China have territorial disagreements of their own and fought a 1962 war over their Himalayan border. An unusually intense standoff between Indian and Chinese forces along the disputed boundary overshadowed a September visit to India by Chinese President Xi Jinping aimed at deepening commercial ties between the two countries. Both sides say they want a peaceful resolution of the border issue. http://online.wsj.com/articles/india-to-supply-naval-vessels-to-vietnam-1414507972

Posted by The Congressional China Caucus | October 28, 2014

Researchers identify sophisticated Chinese cyberespionage group. A coalition of security researchers has identified a Chinese cyberespionage group that appears to be the most sophisticated of any publicly known Chinese hacker unit and targets not only U.S. and Western government agencies but also dissidents inside and outside China. News of the state-sponsored hacker group dubbed Axiom comes a week before Secretary of State John F. Kerry and two weeks before President Obama are due to arrive in Beijing for a series of high-level talks, including on the issue of cybersecurity. In a report to be issued Tuesday, the researchers said Axiom is going after intelligence benefiting Chinese domestic and international policies — an across-the-waterfront approach that combines commercial cyberespionage, foreign intelligence and counterintelligence with the monitoring of dissidents. Axiom’s work, the FBI said in an industry alert this month, is more sophisticated than that of Unit 61398, a People’s Liberation Army hacker unit that was highlighted in a report last year. Five of the unit’s members were indicted this year by a U.S. grand jury. The researchers concur with the FBI’s conclusion, noting that, unlike Unit 61398, Axiom is focused on spying on dissidents as well as on industrial espionage and theft of intellectual property. http://www.washingtonpost.com/world/national-security/researchers-identify-sophisticated-chinese-cyberespionage-group/2014/10/27/de30bc9a-5e00-11e4-8b9e-2ccdac31a031_story.html

Hong Kong Democracy Standoff, Circa 1960. It is a common riposte among those who oppose the pro-democracy demonstrations in Hong Kong, especially here in mainland China: Where were the champions of universal suffrage during the many decades that Britain denied Hong Kong residents the right to govern themselves? “In 150 years, the country that now poses as an exemplar of democracy gave our Hong Kong compatriots not one single day of it,” People’s Daily, the official Communist Party newspaper, said in a recent editorial. “Only in the 15 years before the 1997 handover did the British colonial government reveal their ‘secret’ longing to put Hong Kong on the road to democracy.” But documents recently released by the National Archives in Britain suggest that beginning in the 1950s, the colonial governors who ran Hong Kong repeatedly sought to introduce popular elections but abandoned those efforts in the face of pressure by Communist Party leaders in Beijing. The documents, part of a batch of typewritten diplomatic dispatches requested by reporters from two Hong Kong newspapers, reveal that Chinese leaders were so opposed to the prospect of a democratic Hong Kong that they threatened to invade should London attempt to change the status quo. http://www.nytimes.com/2014/10/28/world/asia/china-began-push-against-hong-kong-elections-in-50s.html?_r=0

Rethinking Taiwan's Submarine Dream. Are subs the best answer to China's growing military power? Taiwan’s submarine saga is back in the news again. For decades, successive governments have been determined to upgrade and expand the nation’s limited undersea warfare capabilities, albeit without much success. The Republic of China Navy (ROCN) currently has two operational submarines, which were acquired from the Netherlands during the late 1980s, along with a pair of U.S.-supplied boats, which date back to the 1940s and are used for training. In 2001, the George W. Bush administration agreed to sell Taipei eight diesel-electric submarines (SSKs) as part of a broader arms package. Because the United States only builds nuclear-powered boats, however, and because potential European partners were reluctant to help in the face of Chinese opposition, that deal never materialized. With the United States unwilling to fulfill its previous commitment, patience appears to be running out in Taipei. According to recent press reports, the government is preparing to embark on an indigenous submarine construction program, although it has not abandoned the option of foreign procurement entirely. Specifically, it plans to build at least four and as many as eight SSKs. Although the details have not been finalized, the boats are likely to displace around 1500 tons each—smaller than its current submarines but comparable to the size of many platforms manufactured in Europe. This would be a major undertaking for a nation with no previous experience in the submarine-building business. Nevertheless, it is hardly surprising that Taiwan wants to improve its submarine force. As a small island nation located just 100 miles from its much larger rival, it occupies an unenviable strategic position. Until as recently as a decade ago, Taiwan enjoyed a military edge over the People’s Republic of China (PRC), and could expect to mount an effective defense against the PRC, especially if it tried to mount an invasion. http://www.realcleardefense.com/articles/2014/10/28/time_for_taiwan_to_rethink_its_submarine_dream_107516.html

China May Be Surprising Winner in Ukraine Turmoil. The surprising winner in the turmoil engulfing Ukraine is turning out to be China, a top U.S. expert on Central Europe and Russia said on Monday. Ukraine has lost thousands of lives in the fighting, the European Union and U.S. lost stature in failing to react to the February annexation and subsequent referendum of Crimea “and Russia has lost because of sanctions,” Yale University history professor Timothy Snyder said during a presentation at a forum at the Center for Strategic and International Studies in Washington, D.C. The reason is twofold: “Russia is a much weaker negotiator on [the price] of natural gas,” having recently completely a sales agreement with China to replace potential losses under sanctions in Western Europe, he said. At the same time, China completed negotiations with Ukraine to lease about nine percent of its grain-producing lands to feed its own people. This Russian tilt toward China will have longer-term consequences. “In foreign policy, you like to have options of playing one side against the other,” as Russia did with the European Union and China — both economically stronger than Moscow, Snyder said. Russia moved closer to China and, “the tilt toward China is going to be a downhill slide” for Russian President Vladimir Putin that he or his successor will need to correct, Snyder said in answer to a question. Yet the Russian moves, including using soldiers in uniforms without insignia, in Crimea and other parts of eastern Ukraine have strong support among the Russian people. http://news.usni.org/2014/10/27/china-maybe-surprising-winner-ukraine-turmoil

U.S. Seeks To Improve Maritime Cooperation With Indonesia. The U.S. government has expressed interest in improving maritime cooperation with the government following the commitment expressed by President Joko Widodo to strengthen Indonesia’s maritime sector. The U.S. Secretary of the Navy, Ray Mabus, applauded the President’s commitment to strengthening the maritime sector in Indonesia, saying that it was a very positive move. He said the vast maritime territory and coastline of Indonesia could present challenges for the country, especially in terms of illegal activities such as smuggling and piracy. “We are very interested in the commitment of President Joko Widodo’s administration. That is why we hope to improve the cooperation with Indonesia in the maritime sector,” Mabus told a press briefing in Medan, North Sumatra, over the weekend. Mabus said that the U.S. also wanted to boost cooperation with the Indonesian Navy in the fields of security, humanity and education. Part of the cooperation would include a disaster-mitigation program and an exchange program for naval officers. Mabus was in Medan to meet the crew of the USS Rodney M. Davis, a guided-missile frigate that had just conducted a joint exercise with the Indonesian Navy. He said the Rodney M. Davis was the first warship to berth in Medan in the last five years. Navy chief of staff Adm. Marsetio said the relationship between the U.S. and Indonesian navies continued to get closer as shown in their frequent participation in joint exercises. http://www.thejakartapost.com/news/2014/10/28/us-seeks-improve-maritime-cooperation-with-indonesia.html

China And Iran Deepening Naval Ties, Iran Calls For Bilateral Blue Water Exercise. Last week’s meeting between the heads of the Iranian Navy and the People’s Liberation Army Navy (PLAN) in Beijing are the latest in a bilateral campaign to increase military to military cooperation and a recognition of growing Chinese interests in the Middle East. On Oct. 23, Iranian Rear Adm. Habibollah Sayyari met PLAN Adm. Wu Shengli in Beijing, “to further pragmatic cooperation and strengthen military-to-military ties,” Sayyari said, according to Iranian state controlled PressTV. Sayyari also met with Chinese Defense Minister Chang Wanquan to discuss enhanced naval cooperation. “Chang said the two armed forces have seen good cooperation on mutual visits, personnel training and other fields in recent years. Exchanges between the two navies have been fruitful and their warships have paid successful visits to each other,” according to a release from the Chinese Ministry of National Defense. Press reports from China and Iran spoke of increased technological cooperation between the two countries but did not go into specifics. Following the meeting both navies expressed interest in conducting a first-ever bilateral blue water naval exercise, building on a PLAN visit to Iran last month. In late September two Chinese warships – Type 052C Luyang II destroyer Changchun and the Type 054A Jiangkai II frigate Changzhou – made a port call at the Iranian port of Bandar Abbas and conducted limited search and rescue (SAR) operations with the Iranian Navy. http://news.usni.org/2014/10/27/china-iran-deepening-naval-ties-iran-calls-bilateral-blue-water-exercise

Posted by The Congressional China Caucus | October 23, 2014

China Says Wants Closer Military Ties With Iran. China wants to have closer military ties with Iran, the Chinese defense minister told the visiting head of the Iranian navy on Thursday, state media reported, reaffirming diplomatic links despite controversy over Iran's nuclear plans. Chinese Defense Minister Chang Wanquan told Iranian Navy Commander Rear Admiral Habibollah Sayyari that the two armed forces have seen "good cooperation on mutual visits, personnel training and other fields in recent years,” China's official Xinhua news agency reported. "Exchanges between the two navies have been fruitful and their warships have paid successful visits to each other," it cited Chang as saying. "Chang ... stressed China is willing to work with Iran to further pragmatic cooperation and strengthen military-to-military ties." Xinhua cited Sayyari as saying Iran attached great importance to its ties with China and was "ready to enhance bilateral exchanges to push forward cooperation between the two armed forces, especially in naval cooperation.” For the first time ever, two Chinese warships docked at Iran's Bandar Abbas port to take part in a joint naval exercises in the Gulf, Iranian state media reported on Sept. 20. Naval cooperation between Iran and China is aimed at reinforcing Iran's military capability in the Gulf, analysts say, as well as displaying China's plan to exert greater influence and presence beyond East Asia. http://www.reuters.com/article/2014/10/23/us-china-iran-idUSKCN0IC0GJ20141023

China's new Senkakus tactic? Fleets of fishermen. Something funny is going on in the waters around the Senkaku Islands, and it's making Japan nervous. There has been a precipitous decline in the presence of Chinese government surveillance vessels around the group of islets in the East China sea, which are controlled by Japan but claimed by China. At the same time, the number of Chinese fishing vessels operating in the area has surged, a development some see Beijing's new approach in pursuing its territorial claims. During the 10th Tokyo-Beijing Forum, held Sept. 28-29 in the Japanese capital, a Chinese military official surprised participants by proposing a long list of steps to prevent a security crisis. His 25 proposals included the establishment of hotlines between the navies and air forces of the two countries and joint efforts to establish common rules concerning maritime operations. He called for "serious working-level discussions" over these proposals. There are also signs of a thaw in the frosty bilateral relations. Beijing has informed Tokyo of its intention to reopen suspended talks to build an emergency maritime communications system. http://asia.nikkei.com/Politics-Economy/Policy-Politics/Chinas-new-Senkakus-tactic-Fleets-of-fishermen

The myth of China's strategic shrewdness. Imagine if just a few days before China's leader Xi Jinping made his first official visit to Japan, the Chinese navy entered the Japanese territory around Senkaku Islands in the East China Sea. Should it happen, tensions would boil over, making it hard for the visit to proceed as planned. An incident similar to this hypothetical situation actually happened recently. According to local reports, days before Xi's visit to India, scheduled to begin on Sept. 17, without any warning, Chinese troops crossed into Indian-controlled territory in the disputed Ladakh region. The border in this area is yet to be demarcated, even decades after the Sino-Indian conflict of 1962. Over 1,000 Chinese soldiers entered the territory this September. It was still happening after Xi's arrival in India, and meant that as the leader called for friendship and cooperation with India's people, Chinese soldiers remained in India-controlled soil. Some observers believe that Xi allowed the troops to cross the line of control, aiming to keep India in check. But the prevailing view is that the Chinese military acted without Xi's knowledge. Many officials, including those at Japanese and U.S. national security authorities, share the latter view. The purpose of Xi's Indian visit was to express Sino-Indian friendship and lessen the influence of Japan and the U.S. on India. However, the India-China border incursion has seriously damaged any such aims, it also caused embarrassment for the Chinese president. A similar border incident occurred in the spring of 2013, roughly a month before Chinese Premier Li Keqiang visited India. http://asia.nikkei.com/Politics-Economy/International-Relations/The-myth-of-China-s-strategic-shrewdness

Hong Kong protest leader: New strategies needed to pressure government. Hong Kong’s pro-democracy movement will need to muster more political power to force the government to listen to its demands, said Alex Chow, one of the student leaders of the demonstrations, as the sit-ins stretched on Wednesday. “We will need to further justify our actions and rethink the strategy of [just] calling on more people to occupy the streets,” said Chow, leader of the Hong Kong Federation of Students. “If occupying the streets [alone] could force the government to back down, they already would have.” Chow said protest organizers are now “thinking out how to regroup [and get] that many protesters back to the streets,” while at the same time figuring out “how to bring the campaign from street to the community, and mobilize more power from Hong Kong people to force the government to change.” http://www.latimes.com/world/asia/la-fg-hong-kong-protest-leader-chow-20141022-story.html

Posted by The Congressional China Caucus | October 22, 2014

China Ties to North Korean Ally Decline. Report says Beijing views U.S. as main regional threat. Once described as “closer than lips and teeth,” Chinese relations with fraternal communist ally North Korea declined to the lowest level in decades this year, according to a draft congressional report. “Sino-North Korean relations are at their lowest point in decades,” says the late draft of the annual U.S.-China Economic and Security Review Commission report. “This is driven largely by China’s frustration over North Korea’s destabilizing behaviors since late 2012, including a nuclear test and a high volume of missile tests.” Still, the report said Beijing regards the United States as its main threat in Northeast Asia, the report said and concludes that the regime of Kim Jong Un “has the potential to be one of the most dangerous flashpoints in U.S.-China relations.” According to the commission report, based on hearings and interviews with government and private experts, North Korea is resentful of its dependence on China and views China as “high-handed and condescending.” The North Korean government also believes China has abandoned Marxism-Leninism and was corrupted politically and morally by capitalism. http://freebeacon.com/national-security/china-ties-to-north-korean-ally-decline/

China suspected of cyberattack on Apple. The Chinese government could be behind a hack on Apple’s cloud storage service, just as the company launches its newest phone in China. Over the weekend, many users in the country inadvertently began giving passwords and sensitive data to hackers that may be working for the Chinese government, security analysts said. Analysts at GreatFire, a website that monitors blocked websites in China, reported that “Chinese authorities are now staging a man-in-the-middle (MITM) attack on Apple’s iCloud,” referring to a type of cyberattack in which a hacker jumps in between a person and the website they are visiting, relaying messages back and forth but also picking up their data. Responding to the attacks on Tuesday, Apple acknowledged the intrusions and unveiled a new guide for people to verify that they are securely connected to the iCloud storage service. http://thehill.com/policy/cybersecurity/221435-chinese-government-suspected-of-launching-apple-cyberattack

It's Time to Wake Up: Chinese Hacking Is Eroding U.S. Military Superiority. Countering Chinese cyber espionage must be a top priority. Earlier this month, the latest cyber-attack against J.P. Morgan garnered national headlines. And most Americans are aware of – if not affected by – last year’s Target and this year’s Home Depot data breaches. Yet many Americans know much less about the regular and sophisticated theft of many of the U.S. military’s cutting-edge weapons systems. The cybercrime has reached the point where the FBI has warned American companies about a group of sophisticated Chinese government-backed hackers that has been working for years to steal economic and national security secrets from the U.S. government and private contractors. The notice comes after the Justice Department indicted five People’s Liberation Army officials in May for commercial espionage. Systematic Chinese cyber espionage has resulted in significant damage to U.S. national security. However, Congress seems to be doing little to help. Part of it can surely be chalked up to what has been called “data breach fatigue.” Presumably the same mindset has infected the nation’s capital. But the Pentagon cares about these breaches, and Congress should start paying serious attention. Last year, the Washington Post reported on a classified Defense Department report that revealed Chinese hackers have compromised the designs of more than two dozen U.S. military weapons systems. The list of impacted programs reads like a catalogue of weapons critical to current U.S. military dominance, including the stealthy F-35 Joint Strike Fighter, the F/A-18 fighter jet, the Patriot missile system, the Army’s Terminal High Altitude Area Defense missile defense system, the Navy’s Aegis ballistic missile-defense program, the V-22 Osprey, UH-60 Black Hawk helicopters, and the Littoral Combat Ship. The Washington Free Beacon reports that other data stolen by the Chinese include the P-8 Poseidon reconnaissance aircraft and RQ-4 Global Hawk drones. http://www.realcleardefense.com/articles/2014/10/21/time_to_wake_up_chinese_hacking_is_eroding_us_military_superiority_107505.html

Taiwan Calls For Calm Over Territorial Disputes. Taiwan serves as a “pivot point” from a geostrategic perspective and a cornerstone for Asia-Pacific regional stability, Taiwan’s Navy chief warned last week. Adm. Chen Yeong-kang spoke during the 2014 International Sea Lines of Communication (SLOC) Conference sponsored by the Taiwan Navy on Oct. 15. Moreover, the Taiwan Strait is the “maritime gullet” between Northeast Asia and Southeast Asia, he said. Any “abrupt armed incident or mass military conflict” in the SLOC is possible and would “endanger transport safety.” Taiwan is attempting to contribute to regional stability by broadening new areas of cooperation, such as the “East China Sea Peace Initiative” put forth by Taiwan President Ma Ying-jeou in August 2012. Conference attendees expressed concern the U.S. might ignore Taiwan’s strategic position and Ma’s initiatives, even as regional powers make opposing chess moves in the South China Sea and East China Sea over rocks, reefs and islets. Bickering between China and Japan over territorial rights of the Japanese-controlled Senkaku Islands in the East China Sea has been increasing in recent years. Taiwan also claims the islands, but has urged for a peaceful resolution to territorial disagreements. http://www.defensenews.com/article/20141021/DEFREG03/310210058

Shanghai Shipyard To Build Second Chinese Designed Aircraft Carrier. China will soon start building its second locally designed aircraft carrier in Shanghai, according to a Canadian report. Kanwa Asian Defence, an English-language monthly defence review produced in Toronto, said Shanghai's Jiangnan Shipyard was preparing to start work on the carrier. When completed, the carrier and another under construction in Dalian will give the PLA Navy two fully functioning, battle-ready aircraft carriers. The recently completed Liaoning, the refitted former Soviet carrier Varyag, is classed as a training platform, not a full combat vessel, by the navy, since it went into service in September 2012. Counter to many expectations, the new carrier about to be built at the Jiangnan Shipyard will use conventional, not nuclear power. The report was also carried in the Chinese-language sister publication, Kanwa Defence Review. Military experts said China would not attempt a nuclear-powered carrier until a range of issues were resolved, such as the reliability of nuclear-powered engines, crew training and establishing a reliable home port for carrier maintenance. According to the report, Chinese shipbuilding industry sources said the design for the second carrier had not been completed. http://www.scmp.com/news/china/article/1621671/shanghai-shipyard-build-second-chinese-designed-aircraft-carrier

Panel: China Expanding Submarine Capabilities. China is constantly improving underwater operations and investments in platforms, sensors, and even oceanographic research, said Thomas Mahnken of Johns Hopkins School of Advance and International Studies during a Monday panel at the American Enterprise Institute in Washington, D.C. Mahnken says that interest in underwater operations in the Pacific and Indian Oceans should be viewed “as part of an ongoing competition” that involves not only the United States and China but other nations in the region that are looking at power projection and sea denial. Nations have a growing dependence on underwater infrastructure – cables for communications of all sorts, and for mineral and fuel extraction, prompting interested in the military undersea. Dean Cheng of the Heritage Foundation added that in its recently revised military strategic guidance China recognizes its “maritime regions are blue soil” and China is as unlikely “to give up as Tibet or Hong Kong.” China is not standing still in its broad-based military modernization – developing stealth technologies; new armor; ballistic missiles; submarines; fast-attack craft; surface combatants; and command, control, communications, computers, intelligence, surveillance and reconnaissance (C4ISR), he said. “China’s submarines [numbering 50 to 60 vessels and now operating for the first time in the Indian Ocean] will not fight alone,” Chen said. Those investments are part of China’s “new historic mission” to defend areas it considers important to its economic center of gravity and the shifting of its manufacturing centers from the nation’s mountainous interior to its coast, Cheng said. He noted that the Chinese word for deterrence can also mean coercion. http://news.usni.org/2014/10/21/panel-china-expanding-submarine-capabilities

On TV, Hong Kong Openly Debates Democracy. After weeks of protests that have shaken this financial hub of 7.2 million people, residents thought they had seen it all. Then, on Tuesday night, something even more extraordinary happened, on live television: a polite debate between earnest students wearing black “Freedom Now” T-shirts and top Hong Kong leaders over the future of democracy. Five student leaders, hair disheveled, took on the officials, who were old enough to be their parents, in the frank discourse. They spoke Cantonese, the prevailing local Chinese dialect, with simultaneous translations into English and sign language. The students wanted officials to commit to greater liberties in future elections. “What is the next step?” Alex Chow, 24, the secretary general of the Hong Kong Federation of Students, asked Hong Kong’s No. 2 official, Carrie Lam, 57. Officials in the two-hour debate made no promises and said they were there to listen. Still, the exchange suggested a softening in the crisis that has convulsed Hong Kong for nearly a month and a possible exit ramp from it. It was a remarkably civil and scholarly discussion, all the more so given the generational divide between the sides. Each cited articles of Hong Kong’s Constitution, chapter and verse, to back its points. Even more remarkable was that it was happening in Hong Kong, the former British colony only a few miles from mainland China, where such a freewheeling public political discussion had not been heard in at least a quarter-century, since students occupied Tiananmen Square in Beijing. That protest provoked a bloody crackdown that has reverberated through China ever since. http://www.nytimes.com/2014/10/22/world/asia/hong-kong-student-protesters-and-city-leaders-meet-to-discuss-democracy.html

Posted by The Congressional China Caucus | October 20, 2014

US, China pledge to “manage” differences. Ahead of President Obama’s visit to China next month, the U.S. and China pledged to “manage” their differences and cooperate on critical issues facing the world. Secretary of State John Kerry said the two countries are “working hard” together on Ebola, terrorism, and many more issues on Saturday as he started a second day of talks with Chinese State Councillor Yang Jiechi in Boston. “There are many issues that China and the United States are cooperating on, even as we have some differences that we try to manage effectively,” Kerry said, according to a release by the State Department. “But right now, particularly on Ebola, on Afghanistan, on the Democratic Republic of North – of Korea, the North Korea nuclear situation, on Iran particularly, and on ISIL and counterterrorism, and on climate change. There are many areas where we are working hard,” he added. Yang added that he expects the meeting between Obama and Chinese President Xi Jinping will be a “successful” one. “We need to work together to build up even more cooperation between China and the United States,” Yang said. Kerry said the two nations are also working together on efforts to rein in nuclear programs in Iran and North Korea, climate change and the Islamic State in Iraq and Syria. Recently, Washington and Beijing have clashed over territorial disputes between China and its neighbors in the South China Sea, pro-democracy protests in Hong Kong, and alleged Chinese cyber spying. http://thehill.com/policy/international/221191-us-china-pledge-to-manage-differences

China says it's hard to resume cyber security talks with U.S. Resuming cyber security cooperation between China and the United States would be difficult because of "mistaken U.S. practices", China's top diplomat told U.S. Secretary of State John Kerry. Cyber security is an irritant to bilateral ties. On Wednesday the U.S. Federal Bureau of Investigation said hackers it believed were backed by the Chinese government had launched more attacks on U.S. companies, a charge China rejected as unfounded. In May, the United States charged five Chinese military officers with hacking American firms, prompting China to shut down a bilateral working group on cyber security. http://www.reuters.com/article/2014/10/19/us-china-usa-cybersecurity-idUSKCN0I80GU20141019

China Growth Seen Slowing Sharply Over Decade. China’s growth will slow sharply during the coming decade to 3.9% as its productivity nose dives and the country’s leaders fail to push through tough measures to remake the economy, according to a report expected to come out Monday. Such an outcome could batter an already fragile global recovery. But the report by the business-research group the Conference Board also finds that multinational companies in China would benefit. Lean times would give foreign firms more local talent to choose from. Foreign companies and investors could also expect “more hospitable” treatment from Communist Party and government officials and a wider selection of Chinese firms they could acquire, according to the report, which was shared with The Wall Street Journal. Foreign companies should realize that China is in “a long, slow fall in economic growth,” the report said. “The competitive game has changed from one of investment-driven expansion to one of fighting for market share.” Officials representing China’s State Council, or cabinet, referred questions to its National Bureau of Statistics, which didn’t respond. Senior officials of the Communist Party are gathering in Beijing for a major policy meeting that opens Monday and is expected to discuss the slowdown. http://online.wsj.com/articles/china-growth-seen-slowing-sharply-over-decade-1413778141

China is again slowly turning in on itself. Deng Xiaoping is back… but only on television. This year — the 110th anniversary of his birth — Beijing is sparing no expense to commemorate the former leader who launched China's modern reform era in the late 1970s, bringing decades of blazing economic growth and steady resurgence as a world power. Unsurprisingly, Deng's mantle is being deployed for political ends. A new 48-episode documentary on his life airing on state networks draws a thinly veiled analogy between Deng and Xi Jinping, China's current top leader. The suggestion is clear. Xi is a new Deng. And when top Communist Party leaders assemble at their annual conference this week, China will witness a revival of the spirit of reform. But China's reform era is over. A different — and more unstable — one is dawning. Ideologically, Deng decisively broke with Maoist isolationism in the late 1970s. China opened up. Students flowed out; outside influences flowed in. When other party leaders criticized such policies for allowing dangerous foreign influences to circulate, Deng famously responded, “If you open the window for fresh air, you have to expect some flies to blow in.” Now, China is again slowly turning in on itself. New party slogans stress “traditional” culture and values. The language of Confucianism is increasingly being invoked to legitimize a new dynasty of red emperors. Windows are being shut. State researchers are being warned against foreign collaboration. Archives previously open to Western scholars are being closed off. And Beijing is reaching for a fly swatter — or a hammer — to deal with influences it perceives as threats. Liberal public interest lawyers are being subjected to a chilling crackdown; Christian churches in Zhejiang province to a selective demolition campaign; Hong Kong pro-democracy media to increasing intimidation. http://www.latimes.com/opinion/op-ed/la-oe-1019-minzner-end-of-china-reform-20141019-story.html#page=1

The U.S. Needs a New Foreign Policy (Part IV). In our three previous installments we discussed how President Obama's six year experiment in retrenching American power has failed. It has created more global disorder, magnified threats to American security, and has shifted America's strategic posture in damaging ways that diminish our ability to shape the international environment. We also took stock of America's resources across the full spectrum of national power, and identified areas needing bolstering as well as areas of strength. In this essay we look forward and offer principles for action that can reverse the decline of American power and influence in the world. The principles below are not just a checklist of discrete items. Rather, they reinforce each other, because a successful strategy requires the integration of each principle with the others. In some cases below we also suggest specific policy initiatives to implement these principles. We should also note that while the Constitution makes national security policy primarily the domain of the Executive Branch, Congress and the private sector also have essential roles to play. The responsibility of restoring American strength falls on all of us. http://shadow.foreignpolicy.com/posts/2014/10/17/the_us_needs_a_new_foreign_policy_agenda_for_2016_part_four

For Japan, Small Gesture Holds Great Importance. The Japanese government has no shortage of issues to worry about — strengthening a faltering economic recovery and trying to persuade a skeptical public to accept a return to nuclear power. But even with all that, the country’s leaders are devoting their energy to a seemingly small gesture: a hoped-for handshake. The gesture has outsized importance because of the two men who would be joining hands: Prime Minister Shinzo Abe of Japan and President Xi Jinping of China, the tough-minded leaders of Asia’s two biggest economies who have circled each other warily for almost two years. The Japanese hope the greeting, and a possible short meeting to follow, would be the start of repairing relations that have taken a pummeling over disputed islands as well as disagreements over the handling of Japan’s wartime history. http://www.nytimes.com/2014/10/19/world/asia/for-japan-and-china-small-gesture-holds-great-importance.html

Gunfire Exchanged Across Korean Boundary. South and North Korean troops exchanged gunfire across their tense border on Sunday, even as the South reaffirmed its desire to hold high-level talks with the North. Ten North Korean soldiers approached the military demarcation line near Paju, north of Seoul, several times on Sunday, prompting South Korean border guards to broadcast warnings for them not to come any farther south, said a South Korean military spokesman, who spoke on the customary condition of anonymity. The last time the North Korean troops approached the line, around 5:40 p.m. on Sunday, South Korean troops fired warning shots, and that prompted a brief exchange of fire between guard posts on the two sides, the spokesman said. No casualties were reported. http://www.nytimes.com/2014/10/20/world/asia/gunfire-exchanged-on-korean-boundary.html

Vietnam Plans Hotline to China to Manage Tensions.​ Vietnam said that it and China have agreed to set up an emergency hotline between their defense ministries to help resolve disputes, as the neighbors struggle to manage increasingly tense disputes over the South China Sea. “It’s necessary for the two countries, particularly the two armies, to continue cooperation, maintain a healthy and stable relation and resolve disputes,’’ Defense Minister Phung Quang Thanh said at a meeting Friday with Chinese Vice President Li Yuanchao , a Vietnamese Defense Ministry statement said Saturday. Chinese state media didn’t mention the hotline, but was positive in tone about Mr. Thanh’s three-day visit. In a meeting Saturday, Gen. Fan Changlong, a vice chairman of the Communist Party’s military commission, called for “positive energy” between the militaries, according to China’s Xinhua News Agency. http://online.wsj.com/articles/vietnam-plans-hotline-to-china-to-manage-tensions-1413637606

Posted by The Congressional China Caucus | October 17, 2014

America Must Face Up to the China Challenge. Regular readers of the National Interest enjoy a rich flow of essays debating the consequences of China’s return as a great power and how U.S. policy makers should respond to the challenge China’s rise will create for U.S. interests in the Asia-Pacific region and around the world. But elsewhere in Washington’s corridors of power and across the country, the subject of China’s rise, its implications for U.S. and regional security, and how U.S. foreign policy should adjust to this development is commonly treated like the proverbial elephant in the room, clearly present, but not clearly discussed. U.S. policy makers and the American public must face up to the fact that China’s return as a great power is inevitably creating a contest that will likely evolve into the most consequential and taxing security challenge the United States will face in the decades ahead. It will be the most consequential because the stability and prosperity of the Asia-Pacific region is of paramount importance to America’s economy, its standard of living, its future prosperity and its own role as a global power. It will be the most taxing, because China will have at its disposal far more resources than the Soviet Union ever dreamed of having. The Cold War security competition demanded much of the United States; the China challenge will demand as least as much, if not more. The China challenge is the elephant in most rooms in Washington perhaps because the magnitude of the challenge is so unsettling to policy makers and planners. Nevertheless, U.S. policy makers and America’s political system will inevitably have to face up to the China challenge. Indeed, there are four harsh realities with which America must soon come to terms. http://nationalinterest.org/feature/america-must-face-the-china-challenge-11490

China building 10,000-tonne coastguard cutters. China is building two large coastguard ships with displacements estimated to be 10,000 tonnes, Chinese military news websites reported on 13 October. The ships are under construction at the Jiangnan Shipyard in Shanghai and will be by far the largest coastguard vessels to enter Chinese service. The largest vessels currently in service are search-and-rescue vessels that displace around 4,000 tonnes, although plans are under way for a 5,000-tonne class. The ships will be operated by the China Coast Guard (CCG), which was formed in March 2013 by amalgamating a number of maritime agencies. CCG ships are usually unarmed, but recent new additions to the fleet have been equipped with very large water cannon that appear to be able to cause serious damage to other vessels. http://www.janes.com/article/44631/china-building-10-000-tonne-coastguard-cutters

China, Vietnam Pledge To 'Address And Control' Maritime Disputes.  China and Vietnam have agreed to "address and control" maritime disputes, state media said on Friday, as differences over the potentially energy-rich South China Sea have roiled relations between the two countries and other neighbors. Ties between the Communist countries sank to a three-decade low this year after China deployed a $1 billion-oil rig to the disputed waters which straddle key shipping lanes. Vietnam claims the portion of the sea as its exclusive economic zone, and the rig's deployment sparked a wave of violent protests in Vietnam. The two countries should "properly address and control maritime differences" to create favorable conditions for bilateral cooperation, Chinese Premier Li Keqiang told Vietnamese Prime Minister Nguyen Tan Dung on Thursday on the sidelines of the Asia-Europe Meeting (ASEM) in Milan. "Thanks to efforts from both sides, China-Vietnam relations have ridden out the recent rough patch and gradually recovered," the official Xinhua news agency cited Li as saying. Xinhua said Dung agreed and endorsed boosting "cooperation in infrastructure, finance and maritime exploration.” The comments were a reiteration of earlier pledges by leaders from the two countries. http://www.reuters.com/article/2014/10/17/us-southchinaseachina-vietnam-idUSKCN0I609N20141017

China’s Naval Chief Visited Disputed Islands In The South China Sea, Taiwan Says. In the latest turn in the continuing territorial disputes in the South China Sea, Taiwan’s top intelligence official has said that the Chinese naval chief surveyed islands in the strategic waterway where China has been carrying out land reclamation work despite protests from other countries in the region, Hong Kong and Taiwanese news media reported on Thursday. Speaking at a meeting in Taipei on Wednesday of the Foreign and Defense Committee of the Legislative Yuan, Lee Hsiang-chou, the director general of Taiwan’s National Security Bureau, said that Adm. Wu Shengli, the commander of the Chinese People’s Liberation Army Navy, conducted a survey of five islands in the disputed Spratly archipelago last month. Calling the trip “unprecedented,” Mr. Lee said that Admiral Wu had made the weeklong trip on a military ship in order to inspect the land reclamation work that China has been conducting on the islands in recent months, according to Takungpao, a Hong Kong newspaper. Takungpao, as well as the Taiwan-based United Daily News, also reported Mr. Lee as saying that President Xi Jinping of China had personally approved the reclamation work, which alarmed Southeast Asian nations that also claim sovereignty over the Spratly Island group when it was revealed earlier this year. Using a dredging vessel, China has been slowly turning several reefs into islands. Other claimants fear that Beijing wants to build military facilities on these land features, including an air base, in order to strengthen its claims. http://sinosphere.blogs.nytimes.com/2014/10/16/chinas-naval-chief-visited-disputed-islands-in-the-south-china-sea-taiwan-says/

Hong Kong Protesters Vow to Hold Ground. Pro-democracy protesters braced for further police action on Friday and vowed to stand firm against any new attempts to remove their encampments after officers partially cleared one of the city’s protest sites earlier in the day. Authorities have been trying for days to dislodge the protesters from busy city streets, but risk deepening the standoff against the students, even as government officials attempt to open negotiations with protest leaders. The police clearance of the protest site in the city’s Mong Kok district on Friday morning “raises strong doubts about the government’s sincerity to engage in dialogue,” Occupy Central with Love and Peace, one of the city’s main protest groups, said Friday evening. Earlier in the day, protesters voluntarily left the Mong Kok encampment after hundreds of officers descended on the site and ordered the crowds to pack up and leave. Clearing that site was expected to be difficult because more radical activists had gathered there, and there had been scuffles in the area earlier between protesters, opponents and police. But the initial police success was tempered a few hours later when protesters started to rebuild their camp, closing one lane of traffic. Tents re-emerged and trolleys of water and food were carted in as police lined the block and watched. By Friday evening, local media reported that crowds in Mong Kok were once again growing. Hong Kong police spokesman Steve Hui said on Friday afternoon that Mong Kok remained a high-risk zone and urged that the occupiers there leave immediately. http://online.wsj.com/articles/hong-kong-police-clear-part-of-protest-site-1413513491

Leaders of China and Japan Are Likely to Meet, Briefly, for First Time. The leaders of Japan and China are likely to meet for the first time next month on the sidelines of a regional summit in Beijing, shaking hands in a carefully negotiated display of good will that Japanese officials say they hope will lower tensions between the two estranged Asian powers. The officials, who spoke on the condition of anonymity because of the sensitive nature of the negotiations, said the hoped-for meeting between Japan’s prime minister, Shinzo Abe, and his Chinese counterpart, President Xi Jinping, had been months in the making and involved behind-the-scenes diplomatic efforts by both nations. While they have not received final word from the Chinese side, they said they were now optimistic that the two leaders would meet briefly — perhaps for about 15 minutes — during the Asia-Pacific Economic Cooperation meeting, or APEC, a summit of regional leaders that Mr. Xi will host. In another sign of rapprochment, Japan’s Kyodo News agency reported on Friday that Mr. Abe had shaken hands with China’s prime minister, Li Keqiang, at a dinner for Asian and European leaders in Milan. The officials said that while the meeting between the two leaders would most likely be too short to delve into issues of substance, they hoped it would be rich in symbolism. They said they hoped a meeting would open the way for a broader thaw in relations between China and Japan, Asia’s two largest economies, which have been in a deep freeze since the Japanese government purchased disputed islands two years ago. http://www.nytimes.com/2014/10/18/world/asia/leaders-of-china-and-japan-are-likely-to-meet-briefly-for-first-time.html?_r=0

Posted by The Congressional China Caucus | October 16, 2014

CNO Greenert: U.S. Navy Needs To Engage More With China. The key to a peaceful maritime future between China and the U.S. will be rooted in additional engagement between the countries’ navies. U.S. Chief of Naval Operations Adm. Jonathan Greenert said at the CSIS and U.S. Naval Institute’s Maritime Security Dialogue on Tuesday. “We all recognize the Chinese Navy is big and growing. It’s capable and they will continue to be more capable but they need to be a responsible neighbor in the Western Pacific as they expand – as they are – operating in the Indian Ocean,” Greenert said. “I think it’s an opportunity that if don’t handle it well, it could be an increasing challenge. Some would say a threat. But first of all we need to recognize its an opportunity.” So far this year, Greenert has met with his People’s Liberation Army Navy (PLAN) counterpart Adm. Wu Shengli five times – more than any other Navy chief, Greenert said. “I think he recognizes that a growing navy is also one that has to be responsible. We have to learn to coexist in the South China Sea, the East China Sea and everywhere,” Greenert said. “He believes that miscalculation is one of our threats and our fear is that we get kicked off into something we don’t want to.” In April, China, the U.S. and several other Western Pacific nations signed the Conduct for Unplanned Encounters at Sea (CUES) – an at-sea etiquette guide when naval ships meet in the region. “We both agree that we have to enable those 40 years command officers with the right processes,” Greenert said. CUES was implemented after an incident when U.S. guided missile cruiser USS Cowpens (CG-63) had a near collision with a Chinese amphibious ship in December. Greenert also said that China and the U.S. plan to conduct more exchanges in the future, starting with a group of PLAN sailors traveling to Newport, R.I. later this year. “It’s really about engagement,” Greenert said. “We’ve to engage if we want to shape. I don’t see any way around it.” http://news.usni.org/2014/10/15/9555

FBI Warns About Chinese Hacker Group; Beijing Denies Spying. The FBI on Wednesday issued a private warning to industry that a group of highly skilled Chinese government hackers was in the midst of a long-running campaign to steal valuable data from U.S. companies and government agencies. “These state-sponsored hackers are exceedingly stealthy and agile by comparison with the People’s Liberation Army Unit 61398 ... whose activity was publicly disclosed and attributed by security researchers in February 2013,” said the FBI in its alert, which referred to a Chinese military hacker unit exposed in a widely publicized report by the security firm Mandiant. Indeed, U.S. officials say privately, the activities of this group are just as significant – if not more so – than those of Unit 61398. The U.S. government has publicly called on the Chinese government to halt its widespread cybertheft of corporate secrets, but Beijing has denied such activities. When the Justice Department in May announced the indictments of five PLA officials on charges of commercial cyberespionage, the government responded by pulling out of talks to resolve differences between the two nations over cyberspace issues. The FBI’s alert, obtained by The Washington Post, coincided with the release of a preliminary report on the same hackers by a coalition of security firms, which have dubbed the group Axiom. “The Axiom threat group is a well-resourced and sophisticated cyber espionage group that has been operating unfettered for at least four years, and most likely more,” said the report, issued by Novetta Solutions, a Northern Virginia cybersecurity firm that heads the coalition. http://www.washingtonpost.com/world/national-security/fbi-warns-industry-of-chinese-cyber-campaign/2014/10/15/0349a00a-54b0-11e4-ba4b-f6333e2c0453_story.html

Taiwan Considers Permanent Armed Ships For Disputed South China Sea Island. Taiwan is considering stationing armed vessels permanently on a disputed South China Sea island, officials said, a move bound to renew friction in a region claimed almost wholly by China, with Vietnam already dismissing such a plan as "illegal.” The potentially energy-rich Spratly islands are one of the main flashpoints in the South China Sea, with claims also from Malaysia, the Philippines and Brunei, and are closely watched by the United States after China placed a giant oil rig in nearby waters also claimed by Vietnam. Itu Aba, also known as Tai Ping, is the only island in the Spratlys large enough to accommodate a port - currently under construction. Taiwan had previously said the port, expected to be completed in late 2015, would allow 3,000-tonne naval frigates and coastguard cutters to dock there. Officials at Taiwan's Coast Guard, which administers Itu Aba, and Taiwan's Ministry of National Defense, which stations troops there, said the port could become the permanent home of armed vessels. "We are discussing this possibility," said Chen Yeong-kang, chief of Taiwan's navy, acknowledging that "it is a very sensitive issue.” Shih Yi-che, head of communications at Taiwan's Coast Guard, said: "The purpose of this action would be to promulgate the Republic of China's sovereignty and power in defending our territory around Tai Ping Island." Rivals China and Taiwan share claims to virtually the entire South China Sea, a legacy of the Chinese civil war when the Communists split from the Nationalists and took control of the Chinese mainland in 1949. The Nationalists settled on Taiwan, and as the "Republic of China,” still claim to be the legitimate rulers of greater China. http://www.reuters.com/article/2014/10/16/us-taiwan-soutchinasea-idUSKCN0I509I20141016

Hagel Devises New Mission for Army: Coastal Defense Force. After two days of US Army top leadership extolling the virtues of putting US boots on the ground across Asia-Pacific to train and advise allies, both old and new, Defense Secretary Chuck Hagel on Wednesday suggested a new Army mission at the annual AUSA convention: a coastal defense force. In a speech to a military and industry audience that mostly shied away from program specifics, the secretary suggested the Army should try and “broaden its role by leveraging its current suite of long-range precision-guided missiles, rockets, artillery and air defense systems.” Hagel said these capabilities “would provide multiple benefits, such as hardening the defenses of US installations; enabling greater mobility of Navy Aegis destroyers and other joint force assets; and helping ensure the free flow of commerce.” He also insisted that “this concept is worthy of consideration going forward” and that “such a mission is not as foreign to the Army as it might seem — after the War of 1812, the Army was tasked with America’s coastal defense for over 100 years.” Transitioning back to the service’s comfort zone, the secretary bemoaned the budget cuts that have landed on the federal government, saying that due to reductions to the Pentagon’s top line budget Army readiness levels have fallen “short of what I believe is sufficient to defend our nation and our allies with minimum risk.” Despite this dim view of readiness, 12 out of 37 brigade combat teams are still trained to the “highest levels of readiness,” he said, a marked increase from last year’s event when Army Chief of Staff Gen. Ray Odierno claimed that only one brigade was at the highest level of readiness. http://www.defensenews.com/apps/pbcs.dll/article?AID=2014310150044

Beating Of Democracy Advocate In Hong Kong Fuels Public Outcry. The videotaped beating of a Hong Kong democracy advocate, apparently by the police, opened a new political fault line in the city on Wednesday, adding to volatile tensions between protesters who have occupied major roads for weeks and the beleaguered government. The video of the advocate, Ken Tsang, being kicked and beaten in a predawn melee, along with pictures of his bruised body, became an emotion-laden focus for critics of the government after a night of mayhem near the city’s heart. They gave a face to accusations that pro-democracy demonstrators have been targeted by an overzealous police force. A video filmed by TVB, a usually pro-government television station, showed a bearded man in a black T-shirt being led away by officers in civilian clothes and black police vests, his hands behind him. The video then jumps to a scene in which a man lying on the ground is kicked and hit many times by several figures who appear to be police officers. TVB said the beating had lasted about four minutes. Outside the North Point Police Station on Wednesday night, Mr. Tsang said he had been “brutally” assaulted by the police during the protest and again at the police station. He said that, because he might pursue legal action, he would not make further comments or answer questions. http://www.nytimes.com/2014/10/16/world/asia/video-of-apparent-beating-of-protester-in-hong-kong-stirs-anger.html

Hong Kong leader ready to talk with protesters. Hong Kong's leader is ready to participate in talks with pro-democracy protesters, the city's embattled Chief Executive Leung Chun-ying said Thursday. The announcement is a potential breakthrough in a bitter standoff between the semiautonmous territory's Beijing-backed authorities and student-led groups who have been taking part in protests that have rocked the city for nearly three weeks. "As long as students or other sectors in Hong Kong are prepared to focus on this issue, yes we are ready, we are prepared to start the dialogue," Leung told reporters in Hong Kong. "This is why over the past few days … we expressed the wish to students that we'd like to start the dialogue to discuss universal suffrage as soon as we can, and hopefully within the following week," he said. http://www.usatoday.com/story/news/world/2014/10/16/hong-kong-protest-talks/17343493/

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