Feeding the dragon: The case of Chinese attack helicopters and implications for export control reform
By Dean Cheng Best Defense department of corporate intelligence This past week, a remarkably disturbing case of arms export control violations came to light, and one which comes at a terrible time for the administration. From the various accounts, it would appear that a subsidiary of United Technologies Corporation (UTC) was exporting software that was ...
By Dean Cheng
By Dean Cheng
Best Defense department of corporate intelligence
This past week, a remarkably disturbing case of arms export control violations came to light, and one which comes at a terrible time for the administration.
From the various accounts, it would appear that a subsidiary of United Technologies Corporation (UTC) was exporting software that was used in China’s new Z-10 attack helicopter program. Worse, according to the U.S. Attorney for Connecticut, where the parent company is headquartered, this was not a case of technology diversion by the Chinese, but a case where the company, Pratt and Whitney Canada (PWC), deliberately engaged in violations of the Export Control Act.
The apparently deliberate nature of this violation makes it distinct from something like the Loral-Hughes problems of the late 1990s which led to the Cox Commission report on China-related security issues and the shift of satellites and aerospace technology to the Munitions List for export controls. In the Loral and Hughes cases, the really important technology wasn’t even technology, it was "know-how," in the form of failure analysis in the wake of several failed Chinese space launches. The Chinese had very little understanding of how to conduct a proper failure analysis, which involves systems analysis, systems integration (almost in reverse), and a willingness to look objectively at problems, without allowing "guanxi" to divert criticism or blame. (Note that the latter aspect is not necessarily restricted to the Chinese, but they have had far more problems in this regard than we have.)
By contrast, the more recent case was not one of dual-use technologies, but clearly military ones. The Z-10 attack helicopter is patterned on the U.S. AH-64, Russian Mi-28, Eurocopter Tiger model, with a classic two-man fore-and-aft crew disposition. There is no mistaking it for a passenger helicopter. PWC was apparently willing to violate U.S. export control laws, so as to gain access to the large Chinese civilian helicopter market.
For the administration, which has been striving to modify and modernize the U.S. export control regime, the case may raise questions about how carefully this task much be approached. PWC’s illegal exports occurred under the current system, one which has been patched and modified but not truly overhauled. Indeed, the administration’s proposed changes would rationalize much of the current system, allowing clearer oversight rather than the current patchwork of sometimes contradictory lines of reporting and responsibility.
The UTC case demonstrates the continued need for export controls on advanced, sensitive technology, but it would be unfortunate if it discouraged, rather than encouraged, badly needed reforms to protect that technology better.
Dean Cheng is a research fellow at the Heritage Foundation for Chinese political and security affairs.
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