Veteran of the People’s Liberation Army became a drone manufacturer. A Shanghai real estate company made more profit from high-altitude airships. An outstanding Chinese aviation scientist founded more than a dozen companies and commercialized his experience.

Many have tried to help their business. support for China’s military modernization. Now the United States can accuse anyone of helping build Chinese spy balloons.

The international conflict over these high-altitude balloons has shed light on China’s “civil-military synthesis” program. Xi Jinping, China’s leader, promoted the recruitment of business firms to help build what he called world-class military defending China’s rise as a superpower. The goal is to create a symbiotic relationship that provides the military with greater and faster access to commercial innovations and businesses access to contracts and military skills.

Several Chinese aircraft and component manufacturers blacklisted by the US government last Friday over China’s ballooning program are involved in the effort, company reports and other Chinese documents show.

One of the companies, called Eagles Men Aviation Science and Technology Group, declared itself “one of the nation’s exemplary enterprises for the synthesis of military and civilian objects.” Another company, Guangzhou Tian-Hai-Xiang Aviation Technology, primarily a drone manufacturer, was founded by a former military officer who fought in China’s 1979 border war with Vietnam. “If you come from the military, you should return this,” said Li Yuzhuang, founder and chairman of the company.

China is far from using the dynamism and innovation of commercial enterprises to help creating a more technologically advanced army. Chinese officials and experts cited examples of the Pentagon’s partnerships with US companies developing cutting-edge technologies, as well as the role of companies such as SpaceX in the US aerospace industry.

However, the all-encompassing power of the Communist Party means that its military priorities demand even more attention and loyalty from many Chinese businessmen. Xi Jinping has long sought to develop technological self-sufficiency, and those efforts are likely to accelerate as Washington expands restrictions on China’s access to microchips.

“Given concerns about foreign sanctions and export controls, we are now seeing more and more efforts from the Chinese side to create a much more meaningful system of military-political fusion,” said Tai Ming Chung, a professor at the University of China. California in San Diego and author “Innovation to Dominate: The Rise of China’s Tech Security State(“Innovation to Dominate: The Rise of the Chinese Technosecurity State”). He called these efforts “an important part of the quest for self-sufficiency in the strategic and defense sector.”

By the time Xi took power in 2012, Chinese leaders had been trying for decades to get civilian industries to work closely with the military. Competition between Beijing and Western governments grew, and domestic innovation became increasingly important to China’s security. However, many of China’s innovative entrepreneurs they tried to work with the military, but were often met with distrust and bureaucracy.

Xi launched a vigorous program to get businesses to share their talent and technology. Local governments have set up funds to support the development of drones, robots and other military technology. In 2017, Xi emphasized the relevance of this initiative by chairing a newly formed national oversight committee. He told the committee that it was “an important step in achieving a national strategic advantage.”

Since 2015, dozens of investment funds dedicated to this purpose have been set up in China, with expected capacity distribute a total of more than $68.5 billion among businessesaccording to a 2021 study by Elsa Kania and Laurent Lascay of the Center for a New American Security.

Today in China there is a complex network of links between military applications, commercialization and academic research of new technologies, links that are “not so random,” E. Kania said.

Those ties, in turn, raised concerns in Washington about whether American goods or technology sold through civilian supply chains could end up being used for military purposes. These fears made her Trump administration to remove Huawei from US technology market and ban US citizens from investing in stocks of companies linked to the Chinese military.

Biden administration officials have also concluded that, at least in some sectors of the economy, even trade ties with China are not secure. On Thursday, the Departments of Justice and Commerce announced the creation of a new “strike force” in 12 US cities to prevent the sharing of advanced technology with adversaries such as China, Russia, Iran and North Korea.

The Biden administration has tightened the country’s export control system to prevent companies from sharing cutting-edge technologies like quantum computing with China. Similarly, the administration’s decision to blacklist five Chinese companies and a research institute that supported military airship and balloon programs is intended to prevent them from buying American technology. The companies did not return calls for comment.

Experts warn that continued state monopolies in the Chinese defense sector and a general distrust of private enterprise mean that China’s efforts to bridge the gap between its military and private enterprises are under development..

But some companies have clearly benefited from China’s efforts to get private companies to work with the military.

For example, the Eagles Men Aviation Science and Technology Group, founded by top Chinese aviation scientist Wu Jie, sold 16 percent of its shares to three state-backed investment funds focused on military capabilities, according to corporate reports.

Eagles Men Aviation has “consistently supplied the Chinese military with stealth technology materials for 14 years, and the stratospheric airship’s flight performance is at the highest level worldwide,” said an executive who visited the company’s headquarters in Beijing in 2019.

Wu Ze helped found another sanctioned firm, Beijing Nanjiang Aerospace Technology, as well as Shanghai Nanjiang Group, a real estate firm that also dealt in graphene (sic: crystal lattice of carbon atoms), intelligent robots and airborne vehicles. Beijing Nanjiang has also signed an agreement with Shilinghot, a city in northern China, to build an “industrial park in space” where test flights can be carried out.

According to a study by David Asher, a senior fellow at the Hudson Institute, one of Nanjiang’s subsidiaries sold drones directly to the People’s Liberation Army.

According to him, traditionally the Chinese military acquired such technologies from state organizations. However, these references may indicate that the Chinese military is purchasing what were originally commercially developed balloons and drones and “applying them to military intelligence gathering, surveillance and reconnaissance.”

“Nanjiang is operating in a way that is symbolic of a new type of merging of civil and military forces,” Asher said.

Wu also helped set up a venture capital firm that invested in a group of satellite, hydrogen and aerospace companies funded by Beihang University, a top military institution also under United States sanctions, according to documents he had access to. risk analysis platform;

One such company, Dongguan Zhonghang Huaxun Satellite Technology, advertised on its website. aircraft with installed tracking systems, including for military needsThis was previously reported by The Wire China. The site has been taken down.

However, even in China, these military connections were not a sure way to get rich. By 2019, for example, the Shanghai Nanjiang space project failed and the company announced the end of the program.

A “Space Industrial Park” in northern China is mired in legal disputes over poor construction quality and high costs. Wu’s Dongfeng Sci-Tech Group was delisted from the Shenzhen Stock Exchange in 2020 after some high-tech involvement.

While Washington has clearly recognized the dangers of the Chinese trade-military partnership, some analysts say the reaction may be exaggerated. Some claimed that previous characterizations of China as a “threat to the whole of society” contribute to ethnic stigmatization of Chinese citizens and some Chinese Americans and discourage valuable academic collaboration.

The balloon incident, in particular, has sparked a “feeling of hysteria” in recent weeks, said Christopher Johnson, president of the China Strategies Group and a former CIA senior China analyst.

When the US government stops trading with Chinese companies and industries, it also affects US competitiveness as it loses access to income and innovation, Johnson said. “We have to take that into account.”