December 18, 2020 – Stealth War Newsletter 20

By: Jamestown Foundation

Fri December, 2020, Age: 2 years



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December 18, 2020

Strategic Indicator
This issue’s number to watch

$72.6 million

The value of a bid by Huawei Marine for an undersea internet cable project to serve the Pacific island nations of Nauru, Federated States of Micronesia (FSM) and Kiribati, which the U.S. has warned could pose security risks.

Top Stories

The U.S. has updated its travel advisory for Hong Kong, warning citizens to reconsider their plans to visit the city because of what the State Department has called “arbitrary enforcement of local laws,” likely referring to the sweeping Hong Kong National Security Law (NSL). The newest travel advisory also noted the increasing presence of mainland security forces operating in the ostensibly autonomous region “not subject to oversight by the Hong Kong judiciary.” Legal scholars have noted that the NSL is vague and broad-ranging enough that it could be applied to anyone in the world, and since the law’s implementation in June, Hong Kong police have been aggressive in using it. Over two dozen people – including pro-democracy lawmakers, activists, and media personnel – have been charged under the new law.

In a related and ominous new development, ten out of twelve activists who attempted to flee Hong Kong after the passing of the NSL in August were officially indicted in a Shenzhen court this week and charged with organizing or participating in illegal border crossings. The remaining two are minors and will be subject to a closed-door hearing where “decisions will be made according to the law,” according to an official statement. China’s judicial system has a conviction rate of around 99 percent, according to legal observers. Last year’s pro-democracy protests were kicked off by a public backlash against a proposed extradition treaty that Hong Kongers feared would allow China’s notoriously repressive legal system to gain a foothold in Hong Kong; this past week’s indictments are just the most recent evidence that this has now effectively come to pass.

On December 16, reports emerged that hackers linked to the Chinese government had infiltrated the security camera footage of the African Union (AU) headquarters in Addis Ababa, Ethiopia. The internal alert emerged in late January as African diplomats gathered for the annual AU leaders’ summit. This latest scandal follows a similar one in 2018, when news emerged that China, after financing the construction of the AU headquarters, had bugged the building and hacked the servers of the news conference center, which copied files and sent them to Shanghai over a period of five years. Due to China’s importance to the African nations, a former official with the AU said that an official reprimand is unlikely.

Despite this fraught history, on December 15 a groundbreaking ceremony was held for the Chinese-funded construction of the Africa Center for Disease Control and Prevention (Africa CDC) headquarters in Addis Ababa. China provided $80 million for the project, which went ahead despite threats from the Trump administration that the U.S. would cease its funding for the Africa CDC. The U.S. cited concerns that Beijing would use its access to steal valuable scientific data.

These episodes provide a window into China’s recent history in Africa, where it has emerged as the continent’s largest creditor and training partner, while still engaging in wide-ranging espionage operations. African leaders are left in an awkward position, desiring the few-strings-attached funding Beijing provides to boost their countries’ developments, while being subjected to (and largely unable to stop) Chinese operations that harm their national security.

Chinese fishing vessels, buoyed by massive state subsidies and backed by a strong coast guard and the implicit support of China’s geopolitical power, have been driven by hungry global and domestic consumers to rapidly expand their activities in recent years. Chinese fishers are now the largest source of illegal or environmentally unsustainable fishing practices (referred to as “illegal, unreported and unregulated fishing,” or IUUF), and have been active in areas ranging from the Arctic Ocean to off the coasts of Argentina. In contested waters closer to home, they have played an important role in asserting China’s extra-territorial claims in the East China and South China Seas and trespassed in the Exclusive Economic Zones (EEZs) of countries such as Vietnam, the Phillippines, South Korea and Japan. Some countries have begun to fight back: the Trump administration issued an executive order earlier this year which included language mandating that the Commerce Department and the National Oceanic and Atmospheric Administration (NOAA) explore ways to “prevent, deter, and eliminate IUUF.” In September the U.S. Coast Guard released a “IUUF Strategic Outlook” which explicitly highlighted Chinese violations of sovereignty and international law. Together, these two documents could pave the way for a more robust policy framework to deal with this issue in the future.

The Chilean navy has said this week that it is closely monitoring a massive Chinese fishing fleet which arrived off the coast of the Galapagos islands in July, and that several vessels had intruded in Chile’s EEZ. Comprised of more than 400 vessels, the fleet has been described by the maritime watchdog group Oceana as “pillaging” the delicate ecosystem in the region for the past several months. In November, Chile announced that it would take measures against illegal fishing. The tiny island nation of Palau has also boldly detained a Chinese fishing vessel and 28 crew operating in its waters earlier this week. Palau, which is one of only four remaining states in the Pacific region and fifteen worldwide that maintains diplomatic relations with Taiwan and officially recognizes its independence, also has a reputation for maritime conservation. It has banned foreign commercial fishing vessels from operating in its waters, but this marks the first time that it has intercepted and detained a Chinese crew. Palau, which has a total population of about 18,000, is closely allied with the U.S.

Delegates from the Chinese People’s Liberation Army (PLA) failed to show up to a meeting with their U.S. counterparts. The meeting, scheduled to begin Monday, was part of an annual, three day working group called the Military Maritime Consultative Agreement (MMCA). The meetings were part of a mechanism intended to strengthen military-to-military (“mil-to-mil”) relations in an effort to reduce risk between the two militaries, who both operate and often confront each other in the South China Sea. The meetings were also meant to review unsafe military incidents that had taken place over the past year.

As the U.S. and China experience a breakdown in their mil-to-mil relationship, China experts Michael Beckley and Hal Brands of the American Enterprise Institute think tank warn that the next decade could be the most unstable period in the history of Sino-American relations. In an article for Foreign Affairs, the experts challenge the notion that the dangers from China as a peer competitor will come later this century. Instead, they contend the next decade poses the greatest risk of conflict, as China now has the capabilities to disrupt the current order in East Asia, but sees its window of opportunity narrowing as its economic growth slows; anti-China sentiment grows internationally; and the United States shifts its focus to the region and organizes allies to confront Beijing. The recent news that the MMCA—a vital mil-to-mil forum meant to reduce the risks between the U.S. and PLA militaries operating in the South China Sea—broke down lends credence to Beckley and Brands’ argument that the next decade could be an explosive one.

Finally, recent economic data has shown that the U.S. dramatically increased its Chinese imports amid the pandemic, which has prompted a boom in e-commerce and funnelled money that would otherwise have been spent on travel, dining out, and other experiences into purchases of consumer goods—many made in China. In November, China reported a 21.1 percent surge in exports compared with the same month last year. Leading the jump were exports to the United States, which climbed 46.1 percent. The surge defied the expectations of American politicians across the political spectrum, who had voiced hopes earlier this year that the pandemic, which began in China, would be a moment for reducing trade with that country and finally bringing factories back to the United States. Even as U.S. imports of Chinese goods grew, China has fallen short of its Phase One trade deal promises from the beginning of the year. As of the end of October, China had purchased about $75.5 billion of targeted goods, or 43.9 percent of its target for 2020 according to Bloomberg calculations based on Customs Administration data.

In another sign for trouble in the U.S. China economic relationship, the stock provider MSCI announced on Tuesday that it would strip its indexes of stocks in seven Chinese companies with ties to the PLA, following an executive order last month which barred Americans from investing in 31 (later updated to 34) companies blacklisted by the DOD which allegedly supply and otherwise support China’s military, intelligence and security services. MSCI’s announcement follows similar moves by S&P Dow Jones Indices, FTSE Russell and the U.S.-based trading app Robinhood to limit customers’ exposure to the affected Chinese stocks.​

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