China likely to step up militarisation in South China Sea: US intelligence report

US intelligence chief Dan Coats presented the report to the Senate in an open hearing. PHOTO: REUTERS

WASHINGTON - China is likely to continue to increase its maritime presence in the South China Sea and build military and dual-use infrastructure in the Spratly Islands to improve its ability to control access and project power, a newly released American intelligence assessment of global threats warned.

Beijing seeks to influence the politics and economies of countries in its backyard, and is expected to increase its engagement in South-east Asia to build its influence while diminishing the influence of the United States and its allies, said the annual report submitted to the US Senate on Tuesday (Jan 29).

It said that in the coming year, China and Russia would compete more intensively with the US and its allies and partners in an expansive race for technological and military superiority, thus presenting greater threats to US national security.

"China's military capabilities and reach will continue to grow as it invests heavily in developing and fielding advanced weapons, and Beijing will use its military clout to extend its footprint and complement its broadening political and economic influence, as we have seen with its One Belt, One Road," said US intelligence chief Dan Coats as he presented the report to the Senate in an open hearing.

"As part of this trend, we anticipate China will attempt to further solidify and increase its control within its immediate sphere of influence in the South China Sea, and its global presence further abroad," he added.

The intelligence report said that China sought to achieve effective control over its claimed waters with a whole-of-government strategy, compel South-east Asian claimants to acquiesce to its claims - at least tacitly - and bolster Beijing's narrative in the region that the US is in decline and China's pre-eminence is inevitable.

In the wake of Washington's withdrawal from the Trans-Pacific Partnership trade deal, China has promoted a unified stance with Asean in defence of multilateralism and World Trade Organisation reform, said the report.

Beijing also fosters a shared perception with Asean that US freedom of navigation operations through Chinese-claimed waters in the South China Sea were threats to regional stability, it added.

The report described China as currying favour with numerous Pacific Island nations through bribery, infrastructure investments and diplomatic engagement with local leaders, while also shielding Myanmar from international sanctions in response to the humanitarian crisis and alleged ethnic cleansing in its Rakhine state.

"Meanwhile, Beijing almost certainly will continue using pressure and incentives to try to force Taipei to accept the One China framework and ultimately Chinese control, and it will monitor the US reaction as an indicator of US resolve in the region," said the report.


The 42-page report also detailed Chinese direct threats to the US, including cyber operations to steal information, influence Americans, and disrupt critical infrastructure.

China's pursuit of intellectual property, sensitive research and development plans, and US personnel data was a significant threat to the US government and private sector, said Mr Coats.

The report called China the most active strategic competitor responsible for cyber espionage against the US government, corporations and allies.

It warned that China is able to launch cyber attacks that temporarily disrupt critical infrastructure in the US, such as the disruption of a natural gas pipeline for days to weeks.

The report listed concerns about the potential for Chinese intelligence and security services to use Chinese information technology firms to spy on the US and its allies, a key fear in the broader American crackdown on Chinese telecommunications giant Huawei, which was indicted on 13 counts of trade secret theft and bank fraud among other crimes in charges unsealed on Monday.

At the hearing, Mr Coats told senators that the intelligence agencies were working to put together a programme to prepare Americans for the Chinese counterintelligence threat, and were travelling around America meeting chief executive officers and others on the topic. He declined, however, to give more details.

FBI director Christopher Wray said of the Chinese counterintelligence threat: "I'm most encouraged by the degree to which US companies and universities are waking up to it... There seems to be more consensus than I've ever seen before in my career."

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