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China's MSS and other intelligence services aggressively target the US, placing particular emphasis on the high tech sector heavily concentrated in Southern California, and in the Silicon Valley. Cover for Beijing's espionage in the United States includes the 1,500 Chinese diplomats operating out of 70 offices, 15,000 Chinese students who arrive in the US each year, and 10,000 Chinese who travel in some 2,700 visiting delegations each year.

Most of the research personnel in Communist China are locked up in the compound of their research institutes, and very few of them have ever had the chance to see things in foreign countries. The shortcomings of the CPC's intelligence research institutes has affected the judgment of the CPC top leadership when making foreign- related policies. Thus it is not surprising that the CPC's foreign policies have been at times confused or too aggressive.

In 1987, Vietnam invaded Cambodia. Prior to Vietnam's 1987 invasion of Cambodia, the CPC's intelligence community assured the Chinese leadership of the Khmer Rouge's ability to resist the Vietnamese invasion. Based on this assurance, the CPC continued suppling the Khmer Rouge with arms, which were seized by the Vietnamese. CPC intelligence also claimed that Vietnam could not capture Phnom Penh, but only a few days after this assessment, Phnom Penh fell into Vietnamese.

In 1979, Hua Guofeng planned to pay a visit to Iran on his way to Western Europe. The assessment of CPC intelligence was that the Shah of Iran would not step down in the near future, though shortly after Hua Guofeng's visit the Shah was forced to leave the country. The CPC was thoroughly discredited by this event and later fell afoul of the new regime in Iran.

On the eve of the collapse of Romania's Ceausescu, Qiao Shi visited Romania to attend the national congress of the Romanian Communist Party. In their reports Qiao Shi before he left for Romania, Chinese analysts stated that the situation in Romania was fairly good. As it turned out, Ceausescu was executed shortly after Qiao Shi returned home.

As early as 1991, the FBI knew about Chinese government contributions to U.S. campaigns. There is evidence that China sought favorable American treatment on trade policy by contributing millions of dollars to the re-election of Bill Clinton and members of Congress. The US National Security Agency intercepted communications indicating that China was targeting 30 Congressional candidates (mostly Democrats) for influence buying campaign contributions. Republican House Speaker Newt Gingrich was one of those candidates. According to James F. Lilley, U.S. ambassador to China in the Bush administration and a former CIA officer:

"U.S. counterintelligence agents and the FBI discovered Chinese efforts to interfere in American campaigns as early as 1991, when FBI agents warned a number of Democratic members of Congress to watch for Chinese donations passed through intermediaries.... It's the way they operate in Asian countries. They do it by bribing government officials; they bribe them to change policy.... Beijing is trying to influence the U.S. position on a host of issues related to ongoing negotiations about China's and Taiwan's entry into the World Trade Organization, market access for American products in China, intellectual-property piracy, technology transfers and weapons proliferation."
Sen. Fred D. Thompson (R-Tenn.), who chaired the 1997 campaign finance hearings, said the committee believed:

"that high-level Chinese government officials crafted a plan to increase China's influence over the U.S. political process," and took "specific steps" to do so, including the allocation of "substantial sums of money" to influence federal and state elections.

US security agencies and the Justice Department's Criminal Division believe, based on counterintelligence surveillance, that Beijing's diplomatic community and espionage network helped Democratic fundraiser John Huang and other political operatives get millions of dollars in campaign donations and "walking-around" cash for the 1996 election.

The plan was launched in 1995 as a relatively benign congressional lobbying activity, but became an effort whose goal was to illegally funnel money into political campaigns. Approved at the highest levels of the Beijing government, the plan was placed under the control of the Chinese Ministry of State Security. U.S. intelligence has established that about $2 million was allocated by the Chinese government, of which at least $1 million was transferred to U.S. banks or to the Chinese Embassy in Washington.

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Updated Friday, January 02, 1998 7:13:59 AM