2011 report to congress - U.S.-China Economic and Security Review ...

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dkrause on DSKHT7XVN1PROD with $$_JOB148348. Xinhua, ‘‘China’s top political stresses indigenous innovation,’’ April 19,2011.349. APCO Worldwide, ‘‘China’s 12th Five Year Plan—Prepared for Public AffairsCouncil’’ (Washington, DC: April 2011), slide 15. http://pac.org/files/Presentation_China’s%20Five%20Year%20Plan.pdf.350. Nick Carey and James Kelleher, ‘‘Special report: Does corporate Americakowtow to China?’’ Reuters, April 27, 2011. http://www.reuters.com/article/2011/04/27/us-special-report-china-idUSTRE73Q10X20110427.351. Dieter Ernst, Briefing to the U.S.-China Economic and Security Review Commission,East-West Center, Honolulu, HI, May 17, 2011.352. Christopher McNally, Briefing to the U.S.-China Economic and Security ReviewCommission, East-West Center, Honolulu, HI, May 17, 2011.353. Gordon Orr, ‘‘Unleashing innovation in China,’’ McKinsey & Company, January2011.354. Wayne Morrison, China-U.S. Trade Issues (Washington, DC: CongressionalResearch Service, May 6, 2011), Summary.355. Bureau of Economic Analysis, ‘‘Summary Estimates for Multinational Companies:Employment, Sales and Capital Expenditures for 2009’’ (Washington, DC:U.S. Department of Commerce, News Release BEA 11–16, April 18, 2011). http://www.bea.gov/newsreleases/international/mnc/2011/pdf/mnc2009.pdf.356. Greg Linden, Jason Dedrick, and Kenneth Kraemer, ‘‘Innovation and JobCreation in a Global Economy: The Case of Apple’s iPod’’ (Irvine, CA: University ofCalifornia-Irvine, Personal Computing Industry Center, January 2009), p. 2.357. Greg Linden, Jason Dedrick, and Kenneth Kraemer, ‘‘Innovation and JobCreation in a Global Economy: The Case of Apple’s iPod’’ (Irvine, CA: University ofCalifornia-Irvine, Personal Computing Industry Center, January 2009), p. 9.358. Gary P. Pisano and Willy C. Shih, ‘‘Restoring American Competitiveness,’’Harvard Business Review (July-August 2009).359. U.S.-China Economic and Security Review Commission, Hearing on China’sFive-Year Plan, Indigenous Innovation and Technology Transfers, and Outsourcing,testimony of Ralph E. Gomory, June 15, 2011.360. World Trade Organization, Accession of the People’s Republic of China, Decisionof 10 November 2001, WT/L/432, IV.8(a) (Geneva, Switzerland), p. 16. http://docsonline.wto.org/imrd/directdoc.asp?DDFDocuments/t/WT/L/432.doc. See also TheWhite House, Office of Public Liaison, ‘‘Summary of U.S.-China Bilateral WTOAgreement,’’ Briefing on the Clinton Administration Agenda for the World Trade OrganizationMaterial (Washington, DC: November 17, 1999). http://www.uschina.org/public/991115a.html.361. Thomas Hout and Pankaj Ghemawat, ‘‘China vs. the World: Whose TechnologyIs It?’’ Harvard Business Review (2010): 3, 5.362. Thomas Hout and Pankaj Ghemawat, ‘‘China vs. the World: Whose TechnologyIs It?’’ Harvard Business Review (2010): 5.363. Doug Palmer, ‘‘Analysis: Hu addresses U.S. stress over China high-techdrive,’’ International Business Times, January 21, 2011. http://www.ibtimes.com/articles/103394/20110121/analysis-hu-addressess-stress-over-china-high-tech-drive.htm.364. Dieter Ernst, Briefing to the U.S.-China Economic and Security Review Commission,East-West Center, Honolulu, HI, May 17, 2011.365. Thomas Hout and Pankaj Ghemawat, ‘‘China vs. the World: Whose TechnologyIs It?’’ Harvard Business Review (2010): 4–5.366. Thomas Hout and Pankaj Ghemawat, ‘‘China vs the World: Whose TechnologyIs It?’’ Harvard Business Review (2010): 3.367. Keith Bradsher, ‘‘G.M. Aims the Volt at China, but Chinese Want Its Secrets,’’New York Times, September 5, 2011.368. Keith Bradsher, ‘‘G.M. Plans to Develop Electric Cars with China,’’ NewYork Times, September 20, 2011. http://www.nytimes.com/2011/09/21/business/global/gm-plans-to-develop-electric-cars-with-chinese-automaker.html.369. Keith Bradsher, ‘‘G.M. Aims the Volt at China, but Chinese Want Its Secrets,’’New York Times, September 5, 2011.370. James McGregor, ‘‘China’s Drive for ‘Indigenous Innovation’: A Web of IndustrialPolicies’’ (Washington, DC: APCO Worldwide, July 28, 2010), p. 32.371. Jason Cooper and Stephanie Chu, ‘‘Surge in Chinese Innovation and the IP[intellectual property] Implications’’ (Washington, DC: Intellectual Property OwnersAssociation, January 2011). www.ipo.org/articles.372. Edward Steinfeld, ‘‘Why China’s Rise is Not a Threat to the West’’ (Eventat the School for Advanced International Studies, Washington, DC, March 9, 2011).373. Gordon Orr, ‘‘Unleashing Innovation in China,’’ McKinsey & Company, January2011.VerDate Nov 24 2008 13:46 Nov 10, 2011 Jkt 067464 PO 00000 Frm 00160 Fmt 6601 Sfmt 6621 G:\GSDD\USCC\2011\067464.XXX 067464
dkrause on DSKHT7XVN1PROD with $$_JOB149374. Nick Carey and James Kelleher, ‘‘Special report: Does corporate Americakowtow to China?’’ Reuters, April 27, 2011. http://www.reuters.com/article/2011/04/27/us-special-report-china-idUSTRE73Q10X20110427.375. U.S.-China Economic and Security Review Commission, Hearing on China’sFive-Year Plan, Indigenous Innovation and Technology Transfers, and Outsourcing,testimony of Leo Hindery, June 15, 2011.376. U.S.-China Economic and Security Review Commission, Hearing on China’sFive-Year Plan, Indigenous Innovation and Technology Transfers, and Outsourcing,testimony of Philip I. Levy, June 15, 2011.377. U.S.-China Economic and Security Review Commission, Hearing on China’sFive-Year Plan, Indigenous Innovation and Technology Transfers, and Outsourcing,testimony of Ralph E. Gomory, June 15, 2011.378. Gary P. Pisano and Willy C. Shih, ‘‘Restoring American Competitiveness,’’Harvard Business Review (July-August 2009).379. U.S.-China Economic and Security Review Commission, Hearing on China’sFive-Year Plan, Indigenous Innovation and Technology Transfers, and Outsourcing,testimony of Leo Hindery, June 15, 2011.380. U.S.-China Economic and Security Review Commission, Hearing on China’sFive-Year Plan, Indigenous Innovation and Technology Transfers, and Outsourcing,testimony of Philip I. Levy, June 15, 2011.381. Nick Carey and James B. Kelleher, ‘‘Special Report: Does Corporate AmericaKowtow to China?’’ Reuters, April 27, 2011. http://www.reuters.com/article/2011/04/27/us-special-report-china-idUSTRE73Q10X20110427.382. U.S.-China Economic and Security Review Commission, Hearing on China’sFive-Year Plan, Indigenous Innovation and Technology Transfers, and Outsourcing,testimony of Willy C. Shih, June 15, 2011.383. Nick Carey and James Kelleher, ‘‘Special report: Does corporate Americakowtow to China?’’ Reuters, April 27, 2011. http://www.reuters.com/article/2011/04/27/us-special-report-china-idUSTRE73Q10X20110427.384. U.S.-China Economic and Security Review Commission, Hearing on The Impactof Trade with China on New York State and Opportunities for EconomicGrowth, testimony of Willy C. Shih, July 23, 2009.385. Roger Cliff, Chad J. R. Ohlandt, and David Yang, Ready for Takeoff: China’sAdvancing Aerospace Industry (report prepared by the RAND Corporation for theU.S.-China Economic and Security Review Commission, 2011), p. 37. http://www.uscc.gov/researchpapers/2011/RAND_Aerospace_Report%5B1%5D.pdf.386. Roger Cliff, Chad J. R. Ohlandt, and David Yang, Ready for Takeoff: China’sAdvancing Aerospace Industry (report prepared by the RAND Corporation for theU.S.-China Economic and Security Review Commission, 2011), p. 115. http://www.uscc.gov/researchpapers/2011/RAND_Aerospace_Report%5B1%5D.pdf.387. General Electric Aviation, ‘‘GE and AVIC Sign Agreement for IntegratedAvionics Joint Venture,’’ Press Release, January 21, 2011. http://www.geae.com/aboutgeae/presscenter/systems/systems_20110121.html.388. Bill Gertz, ‘‘GE–China Venture Probed,’’ Washington Times, August 31,2011. For more information on the close integration of China’s commercial and militaryaviation sectors, see U.S.-China Economic and Security Review Commission,2010 Annual Report to Congress (Washington, DC: U.S. Government Printing Office,November 2010), pp. 92–105.389. Bill Gertz, ‘‘GE–China Venture Probed,’’ Washington Times, August 31,2011.390. Gary P. Pisano and Willy C. Shih, ‘‘Restoring American Competitiveness,’’Harvard Business Review (July-August 2009). See also Economist, ‘‘MultinationalManufacturers Moving back to America,’’ May 14, 2011; Greg Linden, JasonDedrick, and Kenneth Kraemer, ‘‘Innovation and Job Creation in a Global Economy:The Case of Apple’s iPod’’ (Irvine, CA: University of California-Irvine, PersonalComputing Industry Center, January 2009), p. 4; Clyde Prestowitz, ‘‘ClydePrestowitz: The Betrayal of American Prosperity (Excerpt),’’ May 11, 2010. http://www.progressivereader.com/?p=58997.391. Greg Linden, Jason Dedrick, and Kenneth Kraemer, ‘‘Innovation and JobCreation in a Global Economy: The Case of Apple’s iPod’’ (Irvine, CA: University ofCalifornia-Irvine, Personal Computing Industry Center, January 2009), pp. 5, 9.392. ‘‘In reality, there are relatively few high-tech industries where the manufacturingprocess is not a factor in developing new—especially, radically new—products.’’Gary P. Pisano and Willy C. Shih, ‘‘Restoring American Competitiveness,’’Harvard Business Review (July-August 2009).393. Andy Grove, ‘‘How America Can Create Jobs,’’ Bloomberg BusinessWeek, July1, 2010.VerDate Nov 24 2008 13:46 Nov 10, 2011 Jkt 067464 PO 00000 Frm 00161 Fmt 6601 Sfmt 6621 G:\GSDD\USCC\2011\067464.XXX 067464
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12011REPORT TO CONGRESSof theU.S.-C
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U.S.-CHINA ECONOMIC AND SECURITY RE
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dkrause on DSKHT7XVN1PROD with $$_J
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CONTENTSPageTRANSMITTAL LETTER TO T
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23Figure 1:China’s Share of the U
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25The weakness in U.S. exports of a
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31Table 3:RMB Bond Issuances by Mul
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35of bilateral negotiations under t
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37Stonewalling the WTO: A Case Stud
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39that China’s existing system of
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41now. Because the structures of th
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43How Big Is China’s State Sector
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45Fortune Global 500, compared to j
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47panies are less profitable, after
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49erate primarily within state-cont
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57Figure 1: Chinese FDI Stock in th
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63U.S. firms with sensitive technol
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65Addendum I: SASAC Companies, Larg
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67Addendum I: SASAC Companies, Larg
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69dkrause on DSKHT7XVN1PROD with $$
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71January 2010, the heads of 19 U.S
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77cause Beijing had sought to exclu
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81China in Search of Western Techno
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83scious policy seeking to drive Ch
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89Like previous plans, the 12th Fiv
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95Consultative Conference National
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Page 107 and 108: 99panies account[ed] for fully 7 pe
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Page 113 and 114: 105Addendum II: Figures 1-2Figure 1
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199trates the depth of China’s sp
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201Figure 2:Representation of Beido
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205ganization, modeled on the Europ
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207China’s leadership also places
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211[General Armaments Department] p
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213Table 2: Select Chinese Satellit
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215weapons or coorbital satellite w
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217Malicious Cyber ActivitiesDirect
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RECOMMENDATIONSChina’s ‘‘Area
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239320. Chang Xianqi, Military Astr
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243woman Jiang Yu simply expressed
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245Table 1:Timeline of Sino-North K
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249China also provides economic sup
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251economic and social strains woul
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255Iran’s South Pars Gas Field af
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257When asked by Commissioners abou
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281trade, and dispute settlement. 2
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287of Request to the United States
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289fense, since its current fleet o
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323mation Office. Day-to-day superv
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327Although the slogans change over
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335What Constitutes a ‘‘Core In
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339Selected CAIFC/CPD Track Two Exc
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341disseminated through diplomatic
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375ecutive Schedule under section 5
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APPENDIX IIIPUBLIC HEARINGS OF THE
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APPENDIX IIIALIST OF WITNESSES TEST
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393Alphabetical Listing of Panelist
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397In TaiwanU.S. Government• Amer
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APPENDIX VLIST OF RESEARCH MATERIAL
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401The National Security Implicatio
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APPENDIX VIACRONYMS AND ABBREVIATIO
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