Monday, April 17, 2023 // (IG): BB // Financial Enabler // Coffee for Bob
Germany Reviews Use of Chinese Components in its 5G Network
Analyst Comments: According to a report by the Financial Times, companies have pledged over $200 billion to manufacturing projects in the US since Congress passed industrial subsidies last year. The investments in semiconductor and clean tech are almost double the amount made in the same sectors in the entirety of 2021, and nearly twenty times the amount made in 2019. The Inflation Reduction Act passed in August 2021, includes $369 billion of tax credits for clean technologies, while the Chips and Science Act includes $39 billion in funds to stimulate semiconductor manufacturing and $24 billion worth of manufacturing tax credits, aimed at reducing US dependence on Chinese supply chains.
FROM THE MEDIA: The German Interior Ministry is re-evaluating the use of Chinese components in the country's 5G network. The review comes amid growing concerns about Chinese espionage and security risks associated with critical infrastructure. German Interior Minister Nancy Faeser said the investigation would prioritize identifying risks, avoiding dependencies, and averting dangers, and that communication networks needed to be protected, particularly critical infrastructure. German officials have been considering removing Chinese network components from companies such as Huawei and ZTE, although the government has been reluctant to do so.
READ THE STORY: CyberSecurityConnect
Buying the Heartland
Analyst Comments: The article highlights the controversy surrounding the proposed wet corn milling plant in Grand Forks, North Dakota, and its impact on legislative action to restrict Chinese ownership of US farmland. It also touches upon the concerns raised by the US Air Force about the plant's potential national security threat, which ultimately led to the project being voted down. The article provides some context by mentioning the amount of Chinese-owned land in the US, which is relatively small compared to other foreign-owned land.
FROM THE MEDIA: The controversy surrounding the Fufeng Group's proposed wet corn milling plant in Grand Forks, North Dakota, has sparked a wave of legislative action across the country to restrict Chinese ownership of US farmland. The US Air Force's concern that the plant would pose a "significant threat" to national security due to its proximity to a local air force base ultimately led to the project being voted down. Since then, as many as 27 state legislatures have considered or passed new legislation to restrict Chinese citizens or companies from purchasing farmland. Congress is also considering several bills that would restrict Chinese land ownership and increase reporting requirements for foreign ownership of land. However, Chinese-owned land makes up less than 1 percent of all foreign-owned land in the US and 0.03 percent of all total US farmland, according to the US Department of Agriculture.
READ THE STORY: The Wire China
China starts ‘surgical’ retaliation against foreign companies after US-led tech blockade
Analyst Comments: China's targeted approach to attacking Western interests is not new, but it has gained momentum recently, reflecting the worsening US-China relationship. Analysts warn that hostage diplomacy could escalate if China's relationship with the West deteriorates further. This has raised concerns about employee safety and led to the immediate suspension of some travel plans to China. It is likely that Beijing will continue to curtail Western access to materials and technologies critical to the global car industry. The restrictions could also be used as leverage to bargain for a loosening of semiconductor controls. Despite its anger, China is expected to refrain from acting against companies and industries seen as critical to economic recovery.
FROM THE MEDIA: China has started to target Western interests in the country, according to the Financial Times. The move comes after five years of increasing trade and technology restrictions enforced by the US under Presidents Donald Trump and Joe Biden. In response to what it describes as a US-led "technology blockade", President Xi Jinping’s administration has implemented new sanctions, investigations, and fines, which reveal the country's strategy of narrowly targeting industries and companies with little risk to China’s own interests. However, there is concern that Beijing could escalate hostage diplomacy if relations with the West deteriorate, as the decision to detain foreign company staff has raised the prospect.
READ THE STORY: FT
China reportedly let AI control a satellite, which then observed rivals India and Japan
REPORTED IN STATE-SPONSERED MEDIA
Analyst Comments: The use of AI to control a satellite without human intervention is a significant breakthrough in space technology, with potential implications for military and intelligence-gathering applications. However, the autonomous selection of targets by the AI-controlled satellite raises concerns about the use of AI for military purposes, particularly given tensions between China, India, and Japan. While the experiment was conducted in a controlled environment, it remains to be seen how AI-controlled satellites would behave in a real-world scenario. The development of AI-controlled satellites also highlights the ongoing competition between China and the US in space technology, particularly in the context of China’s plan to launch nearly 13,000 satellites to compete with Elon Musk’s Starlink.
FROM THE MEDIA: China’s State Key Laboratory of Information Engineering in Surveying, Mapping, and Remote Sensing (LIESMARS) has reportedly allowed an artificial intelligence (AI) system to take control of a satellite for 24 hours without human intervention. According to a research paper published in the journal Geomatics and Information Science of Wuhan University, the AI-controlled satellite was directed to observe sites in India and Japan, apparently picking its targets autonomously. The experiment’s aim was to test the AI’s behavior in space, and the research team suggested that an AI-controlled satellite could alert select users – including the military, national security administration, and other relevant agencies – if it detected unusual objects or activity.
READ THE STORY: The Register
Ukraine says it is finding more Chinese components in Russian weapons
Analyst Comments: The increasing presence of Chinese components in Russian weapons used in Ukraine highlights the potential loopholes in sanctions imposed on Russia by Western countries. It also underscores the importance of monitoring third-party suppliers, as these components may have been intended for non-military use. While China has denied providing military equipment to Russia, the discovery of Chinese-made components in Russian weapons raises questions about the effectiveness of current sanctions regimes.
FROM THE MEDIA: Ukrainian officials have reported finding an increasing number of Chinese components in Russian weapons used in the ongoing conflict in Ukraine. A senior adviser to President Volodymyr Zelenskiy's office stated that they are finding fewer Western-made components and more Chinese-made components. These include a navigation system in Orlan aerial drones that had previously used a Swiss system and the fire control system in Russian tanks that had earlier used French-made parts. Ukraine is able to identify some of the manufacturers or suppliers of Chinese-made components and share that information with Western allies. China has repeatedly denied sending military equipment to Russia, and a member of staff at China North Industries Group (Norinco), one of the companies named by Ukraine, said the company was "not providing military equipment components to Russia".
READ THE STORY: MSN
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