Feb 1, 2007 – ACCRA, Ghana – China’s success in blowing up one of its Feng Yun weather satellites with a ground-based missile has raised the issue of its ongoing, accelerated, and highly prioritized quest to modernize its military industry complex. Although it has made some progress, China’s military industry still faces problems.
China in recent years has built up strong diplomatic and trade relations in Africa, and President Hu Jintao is currently on a tour of eight African nations. China does have some development
experience to share with Africa, perhaps particularly in the area of poverty alleviation. But civil-military-industrial modernization is certainly not one of them. China’s model is much too dependent on the extravagant profusion of resources and too unproductive to be of much use. The African connection in this context is discussed in detail in the second half of this article.
In the past decade, China has moved mountains to effect radical, wholesale changes to the way its defense industries are organized and their output calibrated to the global projection needs of its evolving geopolitical strategy. The impression has been given that reforms will be bold and sweeping and will manifest in a clear break from the traditional approach of melding technical progress to political priorities in China.
But clearly, from the results, it does not seem as if Chinese leaders had been prepared to move sufficiently away from their comfort zone, because they have only imported the most bureaucratic, centralist, crony-based aspects of military-industrial complexes in operation elsewhere, so that the long-lamented issue of the coupling of the People’s Liberation Army’s (PLA) bureaucratic inefficiency to a resource-intensive approach to military innovation has now been compounded with and magnified by the admission of private sector’s "rent seekers" (corrupt influences) into the fold.
It makes one wonder whether China has been taking lessons from fabulously Dirigiste France. The French military-industrial complex, which has spawned white elephants such as the fancy-ballroom aircraft carrier, the Charles de Gaulle, is a perfect study of how anti-competitive, over-subsidized, crony-dependent, pork-barreled institutional frameworks can handicap even the finest engineering and managerial talent.
The extent to which France’s Grande Ecole and Ecole Polytechnique old boys’ networks have become stumbling blocks in the reform of that country’s stagnating defense industry cannot be summarized here; that the country’s defense industry was nearly bankrupted in the mid-1990s ought to suffice as a hint.
But the experience of even the United States, which boasts some of the grandest military-industrial successes of this age, from the Xerox copier to the Internet, is testimony to the fact that a military-industrial complex, no matter how well resourced, cannot immunize itself from the threat of productivity stagnation.
Some very credible estimates suggest that with increasing intertwining of the interests of defense contractors, military bureaucrats and politicians have faced a situation whereby export subsidies now total the equivalent of 60% of international US arms sales. It is testimony to the resilience of the original institutional architecture that the late president Dwight Eisenhower warned against that spinoffs from the US military-industrial complex continue to greatly enrich the US innovation system as a whole.
Chinese strategists, all credit to them, do understand the theoretical approach to building a successful military-industry complex: emphasizing the development of dual-use capacities (skills and technology that can serve both civilian and military needs), adapting successful commercial systems to military logistic uses, and paying particular attention to areas such as microelectronics that are category-neutral and to information and communications technologies that enhance productivity during shifts between military and civilian contexts (such as intelligent databases).
Indeed, no less a personage than Chinese Vice Premier Huang Ju has said as much. Since 1997, various Chinese Communist Party (CCP) and government conferences have laid out a reform agenda aimed at incorporating the best practices into the present regime. And in 1998, the Chinese Academy of Sciences was tasked with developing a Knowledge Innovation Program, which ostensibly will have considerable impact on China’s modernization goals.
Where attention to these details has been meticulous, China has reaped some impressive results. The country’s maritime industry now ranks behind only Japan and South Korea, a development that may have something to do with the increased sophistication of China’s recent submarine outputs (particularly the Song Class). Engineering-intensive construction projects and the aerospace sector, especially commercial and research satellite development (the Ziyuan series, for instance) and multi-purpose helicopter technologies, are believed to have benefited as well.
Sufficient appreciation also seems to be present in military elite circles about the importance of the private sector. ZTE, Lenovo, Huawei and Julong are particularly mentioned by analysts as playing crucial roles in sourcing technology for the modernization effort.
In physical-resource terms alone, the pace of growth has been astonishing. About 1,200 firms employ 300,000 skilled workers and millions of other employees. Together these companies endeavor to supply the entire panoply of high-tech weaponry, from submachine-guns to nuclear-armed submarines. No other country in the world has, for instance, spent more on naval buildup in recent years, not even the United States.
Yet given the resources exhausted, skill and capacity transfers between the industrial and military systems are far from impressive. The overall aerospace sector, for example, lags behind far less resourced competitors in Brazil and even Spain and, increasingly, Argentina. And this is even discounting the fact that nearly 85% of the intellectual property in China’s advanced high-tech sector is owned by foreigners (interested readers may want to locate a copy of Evan Medeiros’ testimony to the US-China Economic and Security Review Commission, July 28, 2003).
The core challenges
In increasing evidence is a system that remains somewhat stagnant even as more resources are poured into it. In an interesting report prepared by Patrick Draude of the US Naval College for the Defense Technical Information Center in February
2003, the author writes: Years of economic surplus have provided China with the means to significantly improve and modernize its armed forces through procurement of foreign weapons systems, primarily from Russia. The purchasing of these systems demonstrates a profound operational weakness within the PLA – the inability of its military industrial complex to design, develop and produce indigenous state-of-the-art military equipment. Almost every expert agrees that China’s is almost 25 years behind other military-industrial complexes of similar size and scope. In particular, integrative and control systems for assembling ideas, technical know-how and assorted material elements into robust, uniform military or dual-use technological systems are woefully substandard. The core issue is of course productivity. Overcapacity, quality and reliability constraints continue to dog the great majority of principal ongoing projects.
Rampant bureaucracy, a middle management rendered ineffectually risk-averse by a supervision culture that rewards conformity and paper-pushing rather than initiative-taking, and a statistics-obsessed control system that "incentivizes" fraud are the main issues identified by experts with respect to low productivity.
Competitive procurement practices exist on paper but are easily thwarted. The newly created General Armament Department of the PLA, a linchpin in the reform agenda, lacks well-exposed project managers. For this and many other reasons procurement remains tainted by cronyism, leading to a growing concentration of major projects in particular procurement establishments. One expert has cited the example of the lack of competition between missile producers for state contracts, reducing, it would seem, any incentive for price productivity.
To cover obvious flaws the CCP continues to plow in subsidies on the pretext of safeguarding strategic national assets. Like most of the ostensibly market-driven reform programs in China, it appears that the modernization of the military-industrial system is only skin-deep. (The book COSTIND Is Dead, Long Live COSTIND , edited by Richard Yang, is recommended to interested readers. COSTIND stands for the Chinese Commission of Science, Technology and Industry for National Defense.)
Intellectual-property concerns pervade the entire Chinese economy, not just the military-technology sector, and admittedly every country in the world strives to steal as much information beneficial to its security as it can, but the scale of China’s military-industrial espionage is breathtaking. The US Federal Bureau of Investigation is aghast. Among the thefts of technology attributed to Chinese operatives are the entire documentation of the much-regarded Aegis battle-management system, B-2 stealth-bomber technology designs, and blueprints of whole classes of fighter jets.
One may argue that since everyone does it, it doesn’t really matter if someone does too much of it. But in fact such espionage can be so much more counter-productive to young national innovative systems such as China’s where it can be likened to "technology dumping" (as an analogy for the trade variant), with severely damaging long-term effects for domestic innovation.
Even the vaunted Chengdu-built J-10 fighter, which is supposed to mark the beginning of China’s domestic self-sufficiency, upon serious scrutiny does almost nothing of the sort. Many independent experts believe that the radar and fire-control systems are in essence a reverse-engineering of the Israeli ELM-series system, and the core engine technology is in essence a Russian clone. Indeed, Israel’s disbanded Lavi warplane project continues to supply a critical, in our view too critical, component of China’s advanced aeronautical project, including the development of the J-10. Hence China’s continued reliance on its Russian Su-27 fleet for much of its tactical aerial-warfare needs.
So what does all this have to do with the issue of military cooperation between China and African countries?
The African connection
First, it must be emphasized, such cooperation in itself is not new. China has managed security diplomacy by a two-prong strategy since the early Cold War era. Like any other communist country during the Cold War, it saw its survival as linked to the proliferation of communist, particularly Maoist, ideas worldwide and was therefore, within the context of rivalry with the Soviet Union, ready to lend support to any guerrilla movement professing Marxist beliefs. When it lost out in Angola, it compensated with gains in the southeast of the continent.
The second driver of Chinese security interests in Africa is arms trading, though even this was tinged with ideological survival and supremacy. After Somalia fell out with Russia, it turned to China in the early 1980s. China became the dictator Mohamed Siad Barre’s source of heavy-duty armament. Bombers, including both F-6s and F-7s, battery guns, anti-aircraft rocketry and artillery devices of all shapes were supplied to the Mogadishu strongman, sometimes on credit. To keep Barre hooked on this extravagant habit, China arranged some novel financial instruments. Somalia was allowed to binge on weapons in exchange for territorial fishing privileges for Chinese trawlers.
However, in keeping with the evolution of China’s global status, there have been subtle and not-so-subtle but always dramatic transformations of China’s military-industrial relationship to Africa.
There has been an intensification of arms trading, but also in an array of other relations, in multiple directions. Over the past decade only Russia has sold more weaponry to Africa. China, always more skilled than the West in soliciting goodwill, goes the extra mile to make its presence desirable.
Impoverished Zimbabwe since 2003 has handed over more than US$250 million of military contracts to China. Perhaps as a thank-you note, China installed a radar system on the roof of Prime Minister Robert Mugabe’s private mansion. In contravention of United Nations resolutions, Beijing supplied arms to warring Ethiopia and Eritrea to the tune of $1 billion.
China now not only supplies arms to Sudan (as the country’s largest supplier), it has stationed troops there to protect those oil installations it has an interest in. If this signals to your mind the beginning of permanent bases, you would be right; China already runs electronic listening posts in Comoros, an archipelago off the
East African coast.
Now that ideology seems such a quaint proposition, China is more concerned with standard-setting, value-transfer and a host of other "soft power" arrangements that will highlight both its "peaceful rise" geopolitically and "natural leadership" of the Third World. So despite having contributed fewer than a thousand troops to UN peacekeeping missions, Beijing has, to date, sent more than 1,600 military delegations to more than 90 countries, of which 18 are in Africa, in furtherance of its prioritization of bilateral, over multilateral, military diplomacy. Furthermore, it maintains legations in 146 countries and military-diplomatic stations in 103.
As has already been suggested, China’s modernization efforts are directly connected to its desire to project a global military status, and Africa, as always, features quite prominently in this global projection.
The second point to note is that Africa’s armed forces are in sore need of modernization. According to Ghanaian social activist Rashid Zuberu, there have been more than 80 violent or unconstitutional coups in Africa since the first one in Ghana 40 years ago. Ninety leaders have been deposed, of whom 25 lost their lives. Benin endured six coups and 12 heads of state in its first decade after independence. Professionalism and rule-based relations with the civil power and with industry are nearly non-existent in many countries on the continent, often making the military merely an extension of the executive branch.
As in so many other areas, the civil military industrial system in much of sub-Saharan Africa is a blank slate waiting for inscription. Again, as in many other areas, this makes Africa highly vulnerable to the import of all kinds of experimental and trial models. In fact, many of the activities of the World Bank and International Monetary Fund during the past few decades were based on experimenting with imported models from Europe’s Marshall Plan era.
Thus it seems that as China projects its stature across the globe, value and practice transfers will form a significant part of that projection. Africa is almost certainly likely to become a proving ground for Chinese models of modernization and development.
In fact, Africa needs not go far to search for similar insights into military-industrial "unproductivity". South Africa, whose military-industrial complex dates back to the 1940s, has some lessons that China itself might find useful.
Beginning in 1968, when Armscor (the Armaments Corp of South Africa) was formed by legislative charter, that country saw a remarkable expansion of its defense industries even in the face of its isolation over its apartheid system. This isolation, which initially encouraged decentralization and a healthy reliance on a competitive private sector, later saw the state increasingly assume bureaucratic control over key managerial and technical processes, and the private sector transformed into parasitical appendages of the state procurement system.
In the 1970s, South Africa ranked behind only Israel and Brazil among emerging economies in arms production and the sophistication of its output. By the mid-1980s it was supplying countries such as France, Spain, Morocco and Iraq as well as African countries such as Zaire and Malawi, despite international embargoes.
But by the late 1980s, productivity shortfalls had begun to take their toll, leading to sector contraction that would see output shrink by half in 1996. Only a handful of the 2,000 private contractors that were operating in 1984 are still in business. South Africa has only managed to salvage its defense industry from the prospect of total ruin through productivity-motivated restructuring and an ongoing "rationalization" of resources.
So to sum up, military modernization does require a national innovation system that almost always must involve a healthy relationship between industry and the military, between civil policymakers and commercial technocrats, and of course between the men and women in uniform and the political classes. But the mere existence of a so-called military-industrial complex does not necessarily obviate the importance of productivity and the judicious use of resources.
If Africa is to modernize its military, as it must, and transform it from being a worthless burden on scarce resources, and engage its positives in a constructive way to forestall the boredom that is often channeled into coup-making and other unhelpful enterprises, it needs to give serious thought to building a long-term military-industrial complex in the broader framework of an institutionally directed civil-military relationship.
And certainly, the continent will need to avail itself to the best strategies successfully implemented elsewhere. Perhaps in the near future China will develop some very useful models that can benefit Africa. The only contention is that this has not happened yet. For now, China’s challenges have more to teach Africa than its successes.
Bright B Simons is an adjunct fellow at the Center for Humane Education (Imani). Evans Lartey is director of development at Imani, which is a think-tank based in Accra dedicated to researching economic trends to glean practical public-policy insights for the benefit of government, business and civil society in Ghana. Franklin Cudjoe is the executive director of Imani.
