“China has the capability to directly compete with the United States and US allies, and to alter the rules-based global order in ways that support Beijing’s power and form of governance over that of the United States,” the Annual Threat Assessment of the US Intelligence Community issued by the US Office of the Director of National Intelligence on Feb. 5 says.
Each year, the US Intelligence Community publishes its Annual Threat Assessment. In this year’s report, China maintains its position as the primary threat, followed by Russia, Iran and North Korea, alongside international issues and non-state actors such as transnational criminal organizations and terrorist groups. These rankings have been altered little over the past five or more years.
The intelligence community is a comprehensive grouping comprised of two independent agencies — the Office of the Director of National Intelligence and the CIA — along with nine bodies under the US Department of Defense and seven divisions of other departments and agencies.
Each organization within the intelligence community operates with a distinct mandate and perspective when analyzing threats. The Department of Homeland Security (DHS) prioritizes domestic threats, focusing on issues such as crime, drug trafficking, money laundering and cybercrime within the US. Conversely, the agencies and bodies under the defense department primarily address military threats to US foreign policy objectives overseas.
There is some overlap in mandates among the agencies. For example, the DHS, FBI and US Drug Enforcement Agency share concerns about narco-trafficking, while the DHS, FBI and the US Department of the Treasury focus on financial crimes. China poses a threat across all these domains.
It is vital to adopt a comprehensive defense strategy against China because Beijing utilizes a whole-of-society approach and a public-private partnership known as “military-civil fusion” to achieve its policy goals.
China “combines its economic heft with its growing military power, and its diplomatic and technological dominance for a coordinated approach to strengthen CCP [Chinese Communist Party] rule, secure what it views as its sovereign territory and regional preeminence, and pursue global power,” the intelligence report says.
The advancement of modern technology, including artificial intelligence (AI) and satellite communications, along with the risks associated with hacking, has introduced new areas of threats, compelling agencies and entities to develop cybersecurity defenses, detection methods and prosecution mechanisms. China has been identified as one of the primary cyberthreats, engaging in state-backed hacking attacks against the US.
Due to the threats posed to US energy infrastructure, the US Department of Energy’s Office of Intelligence and Counter-Intelligence has significantly increased in importance. China’s potential to disrupt US energy grids, causing widespread chaos, underscores the urgency of addressing this issue.
Similarly, China’s increasing threat in space prompted former US president Donald Trump to establish the US Space Force in 2019. Working alongside the US National Geospatial-Intelligence Agency and the US National Reconnaissance Office, the Space Force’s intelligence department is involved in defending terrestrial targets from Chinese space weapons. Moreover, they are tasked with monitoring China’s activities from space, conducting space-based intelligence, surveillance and reconnaissance, and safeguarding US satellites.
China has articulated its ambitions as part of the modernization of the Chinese People’s Liberation Army (PLA), with a stated goal of becoming a world-class leader in space by 2030. By then, China aims to have developed its space-based intelligence, surveillance and reconnaissance capabilities. PLA military strategies are expected to incorporate counterspace operations, including the deployment of counterspace weapons targeting US and allied satellites. China has already developed electronic warfare systems, directed energy weapons and anti-satellite missiles capable of targeting, disrupting, damaging and destroying satellites.
In modern warfare, reliance on electricity and satellites is so profound that a cyber or space weapon attack could disrupt navigation, communication and missile targeting capabilities. Recent conflicts, such as the wars in Myanmar and Ukraine, highlight the critical role of satellite-dependent systems such as Starlink for troop communication and navigation. Moreover, satellites are utilized in Ukraine for missile targeting, detection and guidance.
China seeks to become a world science and technology superpower, employing means such as investment, scientific partnerships, acquisitions, hacking and intellectual property theft, the report says.
This encompasses diverse fields such as DNA sequencing, precision medicine, agricultural biotechnology, advanced cryptocurrency mining chips, AI, biotechnology, quantum information science and semiconductors. Beijing also aims to exert influence over international AI regulations through endeavors such as the Global AI Governance Initiative, promoting its censorship and objectives in that domain.
The PLA is poised to persist in its modernization efforts while enhancing its arsenal of weapons of mass destruction, particularly nuclear weapons.
“Beijing will focus on building a fully modernized national defense and military force by 2035 and for the PLA to become a world-class military by 2049,” the report says.
That entails the construction of aircraft carriers and the expansion of the navy, with the aim of rivaling the US. PLA ground, naval and air forces would intensify the realism of their drills, with a specific focus on Taiwan.
Expect to see an increase in mockups and simulations aimed at preparing the PLA and intimidating Taiwan. This year and beyond, Beijing is expected to continue applying military and economic pressure on Taiwan, while engaging in disinformation campaigns across the Strait. In the South China Sea, China would further leverage its expanding military and maritime capabilities to intimidate rival claimants, notably the Philippines and Vietnam. Similarly, China would sustain pressure on Japan over disputed territories.
Additionally, Beijing would continue its diplomatic initiatives through China-led forums and groupings, including BRICS (Brazil, Russia, India, China and South Africa), the Belt and Road Initiative, the Shanghai Cooperation Organization, the Global Development Initiative and the Global Security Initiative. By spearheading multilateral organizations and agreements, Beijing seeks to challenge the Western-led, rules-based international order.
Chinese President Xi Jinping’s (習近平) emphasis on security and military modernization is impeding his ability to address pressing domestic economic issues such as an aging society, banking problems, a debt crisis and high youth unemployment. The prioritization of national security has led to the enactment of new laws — including a counterespionage law — which are deterring much-needed foreign direct investment, already at a 30-year low.
Despite anti-corruption efforts, particularly those targeting the military, corruption remains persistent due to the hierarchical structure of the CCP, in which individuals at the top wield significantly more wealth and privilege than those at the bottom.
The emphasis on security, leading to assertive foreign policies, is eroding China’s diplomatic and soft power. With North Korea as its sole official ally, China’s closest relationships are with heavily sanctioned pariah states such as Russia, Iran and Afghanistan. Despite Xi’s aspirations to position himself as the champion and leader of the Global South, his endeavors are met with skepticism and reluctance, particularly as India vies for a similar role.
China remains the foremost threat to US foreign policy and the Western-led international order. While it excels in technology and military advancements, it falls short in diplomacy and coalition building. Its economic power is expected to decline due to factors such as decreased foreign investment as result of heightened internal security measures and increased defense spending at the expense of civil society. This leaves persistent structural economic issues like aging, debt and the real-estate crisis unaddressed.
Antonio Graceffo, a China economic analyst who holds a China MBA from Shanghai Jiao Tong University, studies national defense at the American Military University in West Virginia.
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