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Chinese IT Companies Form Alliance to Enter Military Market

On Wednesday, 50 of China's largest IT firms formed an alliance aimed at strengthening their stake in China's increasingly lucrative defense market. Member companies of the "Computer World Army-Supporting Alliance on Science and Technology," as the alliance has been dubbed, hope to take advantage of government contracts anticipated as the Chinese military begins to reform its purchasing system to adopt the practice of government procurement. Li Jinai, a member of the central Military Commission and director of the General Armament Department of the Chinese People's Liberation Army (PLA) attended the ceremony marking the launch of the alliance.

The People's Daily reported that, some of the companies have donated IT products including servers, personal computers, exchanges and routers to the army, and several firms pledged to help train IT personnel for the military. The move was approved jointly by the Ministry of Information and Industry (MII), the General Armament Department, and the China Electronics Science and Technology Group. It also received sponsorship from the Computer World Media Group.

Past Summaries


Pentagon Report on PLA Modernization

A report released Wednesday by the Pentagon concluded that China is acquiring missiles more quickly than previously thought, adding 75 missiles a year to its existing stock of 450 short-range ballistic missiles instead of 50, the number in last year's report. The report also said that preparing for an armed confrontation over Taiwan was the "primary driver" of China's military modernization. The report also noted China's recent acquisition of Russian-made submarines that could be used to cut off shipping to Taiwan and/or threaten U.S. forces in a conflict.

Beijing has spent heavily in recent years on modernizing its 2.5 million-member military, which amounts to the world's largest. However, analysts point out that despite its size, the People's Liberation Army lags far behind U.S. forces. The double-digit growth in the Chinese military budget every year in the past decade more likely reflects the impressive U.S. military victory in the Gulf War than an unfolding plot to forcibly reunify Taiwan with the mainland.

The Chinese side quickly denounced the report. "The goal is an excuse to sell advanced weapons to Taiwan and fabricate public opinion," the Chinese Foreign Ministry said in a written statement. "The Chinese side expresses its strong dissatisfaction and resolute opposition." The Chinese may have a point, since the U.S. is the main arms supplier to Taiwan. Moreover, in recent "unofficial" meetings with the Department of Defense, Taiwanese representatives have been asked to purchase more weapons.

Past Summaries

International: Six-Way Talks to be Held

After insisting for months on bilateral talks with Washington, North Korea publicly agreed Friday to the American proposal for a broader discussion involving the two Koreas, the Unites States, China, Japan, and Russia. President Bush was informed of the DPRK's decision Wednesday during a phone conversation with Chinese President Hu Jintao. China, long functioning as the go-between in the dispute, has said repeatedly that it wants a nuclear-free Korean Peninsula, and would like to see the issue resolved peacefully.

For the Bush administration, it was rare good news in a long standoff. For months the DPRK seemed intent on moving ahead with its nuclear weapons programs after earlier agreeing to dismantle its nuclear programs. After hearing the news of the DPRK acceptance of multilateral talks, President Bush said in a statement, "In the past it was the lone voice of the United States speaking clearly about this. Now we'll have other parties who have got a vested interest in peace on the Korean peninsula."

The time and place for the discussions has not been determined yet, but Beijing appears to be a likely candidate.


All views expressed herein are those of the writers and editors
and do not reflect the views of USCPF itself.



Last Updated: 5 December 2001

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