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China's Emergent Military Aerospace and Commercial Aviation Capabilities

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China's Emergent Military Aerospace and Commercial Aviation Capabilities CHINA’S EMERGENT MILITARY AEROSPACE AND COMMERCIAL AVIATION CAPABILITIES HEARING BEFORE THE U.S.­CHINA ECONOMIC AND SECURITY REVIEW COMMISSION ONE HUNDRED ELEVENTH CONGRESS SECOND SESSION _________ May 20, 2010 _________ Printed for use of the United States­China Economic and Security Review Commission Available via the World Wide Web: www.uscc.gov UNITED STATES­CHINA ECONOMIC AND SECURITY REVIEW COMMISSION WASHINGTON : June 2010 U.S.­CHINA ECONOMIC AND SECURITY REVIEW COMMISSION DANIEL M. SLANE, Chairman CAROLYN BARTHOLOMEW, Vice Chairman Commissioners: DANIEL BLUMENTHAL Hon. WILLIAM A. REINSCH PETER T.R. BROOKES DENNIS C. SHEA ROBIN CLEVELAND PETER VIDENIEKS JEFFREY FIEDLER MICHAEL R. WESSEL Hon. PATRICK A. MULLOY LARRY M.WORTZEL MICHAEL R. DANIS, Executive Director KATHLEEN J. MICHELS, Associate Director The Commission was created on October 30, 2000 by the Floyd D. Spence National Defense Authorization Act for 2001 § 1238, Public Law No. 106­398, 114 STAT. 1654A­334 (2000) (codified at 22 U.S.C.§ 7002 (2001), as amended by the Treasury and General Government Appropriations Act for 2002 § 645 (regarding employment status of staff) & § 648 (regarding changing annual report due date from March to June), Public Law No. 107­67, 115 STAT. 514 (Nov. 12, 2001); as amended by Division P of the "Consolidated Appropriations Resolution, 2003," Pub L. No. 108­7 (Feb. 20, 2003) (regarding Commission name change, terms of Commissioners, and responsibilities of Commission); as amended by Public Law No. 109­108 (H.R. 2862) (Nov. 22, 2005) (regarding responsibilities of Commission and applicability of FACA); as amended by Division J of the “Consolidated Appropriations Act, 2008,” Public Law No. 110­161 (December 26, 2007) (regarding responsibilities of the Commission, and changing the Annual Report due date from June to December). The Commission’s full charter is available at www.uscc.gov. ii July 21, 2010 The Honorable DANIEL INOUYE President Pro Tempore of the Senate, Washington, D.C. 20510 The Honorable NANCY PELOSI Speaker of the House of Representatives, Washington, D.C. 20515 DEAR SENATOR INOUYE AND SPEAKER PELOSI: We are pleased to transmit the record of our May 20, 2010 public hearing on “China’s Emergent Military Aerospace and Commercial Aviation Capabilities.” The Floyd D. Spence National Defense Authorization Act (amended by Pub. L. No. 109­108, section 635(a)) provides the basis for this hearing. During the hearing, the Commission received testimony from Congressman Roscoe G. Bartlett (R­MD). Congressman Bartlett provided his perspective on what China’s efforts to modernize its aviation capabilities means for regional and global security. Representatives from the Executive Branch and expert witnesses described to the Commission recent developments in China’s military aerospace capabilities. According to then­Deputy Under Secretary of the Air Force for International Affairs Bruce S. Lemkin, although the Chinese Air Force still lagged behind the U.S. Air Force, China has greatly improved its long­range air defense, electronic warfare, computer network attack efforts and offensive strike capabilities. Wayne Ulman, China issue manager at the U.S. Air Force’s National Air and Space Intelligence Center, detailed the “dramatic changes [that] have occurred in the areas of mission, personnel, training, and equipment” in China’s Air Force. Mark Stokes, executive director of the Project 2049 Institute, told the Commission how China relies upon its expanding conventional ballistic and cruise missile arsenal to close the gap between the Chinese military and more advanced militaries. Roger Cliff, senior political scientist at the RAND Corporation, felt that because of these modernization efforts, the Chinese Air Force could present a “substantial obstacle to the United States” in the event of a conflict between the two militaries. Focusing on how China’s growing missile arsenal could affect the U.S. military, Jeff Hagen, senior engineer at the RAND Corporation, described to the Commission how RAND research demonstrated that the Chinese military, relying predominantly on conventional missile strikes, could potentially disable most U.S. Air Force bases in the region. Rebecca A. Grant, director of the Mitchell Institute for Airpower Studies, opined that China’s highly capable air defense systems and numerically superior fighters would pose serious problems to U.S. military aircraft in the region. Panelists also described the current developments and future trends of China’s aviation industrial base. Peder Andersen, international trade analyst for aerospace at the U.S. International Trade Commission, described how Beijing has prioritized the development of an indigenous civil aircraft industry and reorganized its aviation manufacturing industry to support this goal. Agreeing with Mr. Andersen, Tai Ming Cheung, associate adjunct professor at the School of International Relations and Pacific Studies, University of California, San Diego, told the Commission that China is “pursuing an ambitious strategy to build an internationally competitive, innovative, and comprehensive aviation design and manufacturing base within the next one to two decades.” Focusing on recent developments, Richard D. Fisher, Jr., senior fellow at the International Assessment and Strategy Center, explained the interconnectedness between China’s civil and military aviation industrial bases. iii The Commission also heard about the implications of a growing Chinese aviation industrial base for the United States. Addressing the current state of U.S. aerospace industry, Deputy Assistant Secretary of Commerce for Manufacturing and Services Mary H. Saunders told the Commission that while China is an increasingly important consumer of aerospace products and services, U.S. aerospace manufacturers face several obstacles in the market. In particular, she highlighted such challenges as the relationship between civil and military aviation production in China, the direction of Chinese aerospace industrial policy, and the extent of unfair Chinese subsidies to the aerospace sector. Expert witnesses disagreed, however, on the specifics of how the U.S. industrial base would be affected. Owen E. Herrnstadt, director of trade and globalization at the International Association of Machinists and Aerospace Workers, felt that the U.S. industrial base would permanently suffer since U.S. companies were increasingly outsourcing aerospace jobs and know­how to China. Disagreeing with Mr. Herrnstadt, Daniel K. Elwell, vice president for the Aerospace Industries Association, argued that the growth in China’s demand for civil aircraft over the next 20 years would be enough to split opportunities between both China and the United States. Thank you for your consideration of this summary of the Commission’s hearing. We note that the prepared statements submitted by the witnesses are now available on the Commission’s website at www.uscc.gov. The full transcript of the hearing will be available shortly. Members of the Commission are also available to provide more detailed briefings. We hope these materials will be helpful to the Congress as it continues its assessment of U.S.­China relations and their impact on U.S. security. Per statutory mandate, the Commission will examine in greater depth these and other issues in its Annual Report that will be submitted to Congress in November 2010. Should you have any questions, please feel free to have your staff contact Jonathan Weston, the Commission's Congressional Liaison, at (202) 624­1487. Sincerely yours, Daniel M. Slane Carolyn Bartholomew Chairman Vice Chairman cc: Members of Congress and Congressional Staff iv CONTENTS _____ THURSDAY, MAY 20, 2010 CHINA’S EMERGENT MILITARY AEROSPACE AND COMMERCIAL AVIATION CAPABILITIES Opening remarks of Commissioner Daniel A. Blumenthal (Hearing Cochair)…… 1 Opening remarks of Commissioner Peter Videnieks (Hearing Cochair)………… 2 PANEL I: ADMINISTRATION PERSPECTIVES Statement of Mr. Bruce S. Lemkin, Deputy Under Secretary of the Air Force for International Affairs, U.S. Air Force Prepared statement……………………………………………………………… 4 Statement of Ms. Mary H. Saunders, Deputy Assistant Secretary of Commerce for Manufacturing and Services, U.S. Department of Commerce………………... 14 Prepared statement……………………………………………………………… 19 Panel I: Discussion, Questions and Answers……………………………………. 22 PANEL II: DEVELOPMENTS IN CHINA’S MILITARY AEROSPACE CAPABILITIES Statement of Dr. Roger Cliff, Senior Political Scientist, The Rand Corporation, Arlington, Virginia……………………………………………………………….. 36 Prepared statement……………………………………………………………… 38 Statement of Mr. Mark Stokes, Executive Director, Project 2049 Institute, Arlington, Virginia………………………………………………………………... 38 Prepared statement………………………………………………………………. 41 Statement of Mr. Wayne Ulman, China Issue Manager, National Air and Space Intelligence Center, Dayton, Ohio…………………………………………………. 46 Prepared statement………………………………………………………………..48 Panel II: Discussion, Questions and Answers…………………………………….. 56 PANEL III: CHINA’S AVIATION INDUSTRIAL COMPLEX Statement of Mr. Richard D. Fisher, Jr., Senior Fellow, Asian Military Affairs, International Assessment and Strategy Center, Washington, DC…………………..75 Prepared statement………………………………………………………………. 78 Statement of Dr. Tai Ming Cheung, Scientist, Institute on Global Conflict and Cooperation, Associate Adjunct Professor, School of International Relations and Pacific Studies, UC San Diego, California……………………………………….. 96 Prepared statement………………………………………………………………. 98 v Statement
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