21 July 2014

Breaking Western Monopolies: Chinese Military Innovation Bearing Fruit

July 17, 2014

On July 10, several Chinese news outlets announced that China had taken an important step towards achieving “self-reliance” (zizhu baozhang) through the “breaking” (dapo) of a foreign monopoly on military-use computer airborne systems (People’s Daily Online, July 10). Many details of the two real-time operating systems (RTOS) have yet to be released, yet their implications for China’s national military industrial complex are nonetheless important, given it has long been criticized for its limited progress in indigenous innovation resulting from an over-reliance on foreign importation of technology and knowledge.

Details of RTOS

According the press release, the two RTOS are reported to maintain a high degree of “reliability” (gao kekao xing) and “security” (gao anquan xing), outperforming foreign equivalents when put through testing conducted by the Committee for the Finalization of Military Aviation Products. Cross referenced with details from the website the developer, Coretek, a subsidiary of the China Aviation industry Corporation (AVIC), both RTOS are assumed to comply with DO-178B guidance, an internationally recognized standard determining the reliability of software when used in conjunction with specific airborne equipment, including both commercial and military aircraft (Coretek, July 8). It has yet to be established which military aircraft have been the primary targets in the development of the two systems. However, China’s military defense system is reported already to have adopted the new RTOS, carrying important implications not only for the future of its combat capable force (currently estimated at 2,193: IISS Military Balance 2014, p. 236), but also for international export markets, where China is becoming an increasingly important player. China has, up to this point, lacked the capability to produce operating systems rivaling those developed by companies such as IRKUT (Russia) and Green Hills Software (USA), who have respectively developed RTOS for fighter models as the Su-30 and F/A-22. Moreover, while national research and development in China’s military industry remain primarily focused on support of the PLA and its procurement needs, it has already established niche export markets with some Asian and African countries with considerable prospects for growth, particularly if it can compete with Russian dominance in engine production.

Implications for Innovation in China’s Military Industrial Complex

Over the last sixty years, China has produced few truly “indigenous” innovations. Foreign acquisition, reverse engineering, coproduction and theft have proved more reliable ways to quickly close perceived strategic gaps. Even China’s more recent aircraft models such as the J-10B, which is promoted nationally for its indigenously developed engine (the WS-10A), required Israeli assistance for the design of its weapons systems and delivery platforms. Similarly, parts of the design of China’s much-anticipated fifth-generation fighter, the Chengdu J-20, are believed to have been stolen from the Lockheed Martin F-35 Lightning II platform via a cyber espionage campaign dubbed “Operation Byzantine Hades” by U.S. intelligence agencies (Wall Street Journal, April 21, 2009). 

Cyber campaigns and reverse engineering offer a cost-effective means for fast development of modern technologies, particularly given the range of problems with domestic innovation efforts frequently cited by external observers: “inefficiency, redundant leadership and overlapping organization and bureaucratic structures” over the last two decades (The Chinese Air Force: Evolving Concepts, Roles, and Capabilities [2012], p. 257). However, the emphasis on foreign acquisition does not necessarily obstruct domestic innovation, and the latest development in avionics is likely to be part of a larger qualitative shift in Chinese indigenous production. China has undertaken a major overhaul of its entire military industrial base over the past 20 years, the results of which have been a quantum shift in quality production, approaching world-class standards in a multitude of arenas.

Beginning in the early 1990s China first restructured its defense industry base into large state owned enterprises, such as the China Aviation Industry Corporation (CAIC), with the aim to increase productivity under corporate structures. Since then, several phases of reorganization have seen the formation of 11 national level military-industrial groups, now under the administration China’s State Administration of Science, Technology, and Industrial for National Defense (SASTIND) with increasingly commercially-sourced funds that has allowed for Chinese firms to undertake increasingly risky research projects that were thwarted under previous industry management structures and boosted domestic competition. Finally, cross-over between China’s civilian and military sectors, championed under the 2006–2020 MLT Science and Technology Development Plan and reinforced by Chinese leadership (for example during Hu Jintao’s speech at the 17th Party Congress) has allowed military industrial enterprises to take large strides in collaborative research and development (China.org.cn, October 15, 2007).

Military-use aviation technologies do not frequently transfer to civilian arenas, meaning that compartmentalization of technologies continues to pose issues for certain military development areas. However, the long-term goal of China’s military technology base continues to be self-reliance, as lessons from its 1960s split with the Soviet Union, has shown that over-reliance on foreign technology leaves China strategically weak. The split forced China to develop its reverse-engineering capabilities, but at a considerable time cost. It was only later during the latter part of the 1970s that China was able to source advanced technology from other countries such as Britain and France through broadening its diplomatic engagement.

Furthermore, modern export restrictions (most notably from the EU and United States), in place since 1989, continue to act as a significant hindrance to China’s ability to co-produce or procure modern technologies from Western nations. Industrial espionage has yet to cause wide-spread consequences for China in terms of international commercial engagement, with Germany and the UK both recently signing further trade agreements worth tens of billions of dollars on the back of the visits by Chinese Premier Li Keqiang (China Daily, June 20). Moreover, as the strategic gap in capabilities narrows, Chinese enterprises will be increasingly pushed towards innovation rather than imitation in order to gain competitive advantages not only in a strategic sense, but also in the economic arena. 

In aviation fields, significant hurdles will need to be overcome before China can realize its core goal to become a global strategic power, most notably its difficulties in producing a turbo-fan engine. Key Russian and Western analysts still assume the PLAAF is 15–20 years behind the world’s leading air-powers. The former Chinese president, Hu Jintao originally tasked Chinese military technology developers with “blazing a path of development of integrating civilian and military spheres” (zou chu yi tiao zhongguo tese junmin ronghe shi fazhan luzi), the gap may be closing significantly through established methods of imitation, coproduction and theft, but as this occurs it can be expected that indigenous innovation increasingly features as a component of Chinese procurement strategy (Report to the Seventeenth National Congress of the Communist Party of China, October 15, 2007). 
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