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Technology Transfer to China, from Peter Myers

(1) Huge Technology Transfer from West & Japan to China(2) Rolls-Royce & China Yuchai jointly produce MTU engines for Submarines, with quiet diesel motors(3) China has a list of encouraged industries; other sectors are closed to foreign investment(4) Forced Technology Transfers To China(5) Vietnam turns to USA to counter China bullying(6) China's Silent Invasion of Australia - Clive Hamilton(1) Huge Technology Transfer from West & Japan to China faces a crucial decision on technology transfers to ChinaBeijing is now taking a dual approach to Taipei, offering incentiveswhich raise some questionsBy STEPHEN BRYENMARCH 6, 2018 1:13 PM (UTC+8) 342 0After unprecedented snarling by China at Taiwan’s pro-independence government and various sorts of punishments – even cutting down tourism to Taiwan from China – Beijing is now playing a rather different card.It is offering important incentives to Taiwanese businesses and individuals, even TV and movie producers, to expand their businesses in China and participate in key projects, especially in science and technology.But in Taiwan, perhaps for the first time in many years, Taiwanese leaders and some from the academic and business community are starting to grasp that this latest move by China is not necessarily in Taiwan’s national security interest.Years ago – as far back as the Nixon administration and as part of that administration’s idea of detente with Russia – the United States promoted investment and technology transfers that it pledged would help transform Communist Russia into a more pliable and engaged power, and one willing to cooperate with the West.What actually happened was far different. Russia was in the midst of a military buildup and America’s transfers of technology and know how helped boost Russia’s military far more than supporting civilian industries. Thus the Kama River Truck Factory (Kamaz) and its ancillary but vitally important diesel-engine manufacturing plant gave the Russians a new generation of military vehicles.Likewise, the sale of modern fertilizer factories provided Russia with a bigger supply of quality explosives for their army. Along the same lines, the loosening of COCOM (the Western Coordinating Committee composed of NATO members plus Japan) restrictions that supposedly regulated high tech trade gave Russia access to modern computers and electronics, which were sorely missing from Russia’s army, air force and navy.With China it is a bit different in the sense that it is much worse. Western companies have freely transferred vast amounts of high technology to China and provided the manufacturing know-how and systems, including automation needed to support China’s economic and military ambitions.Taiwan was among the big investors in China, ostensibly for business reasons because China offered a huge labor force and Taiwan was running out of skilled and semi-skilled manpower. But Taiwan also had a political agenda, along the same lines the Nixon administration claimed it was pursuing in Russia.So Taiwan forged ahead without any analysis of the real implications, and so did their natural competitors in the United States, Western Europe and even Israel.Keep in mind that most of the Silicon Valley companies and large aerospace companies such as Boeing and Sikorsky wanted to get into the China market and were willing to transfer technology highly leverageable by China’s military. It even got to the point that Sikorsky, which will build the new US Presidential helicopter, is building the same model in China.The Europeans also did their best both openly and under the table, providing military technology directly to China. In the European view, US trade with China needed some balancing, and Europe could only compete with the products and technology it has, such as automobile technology and sophisticated machine tools and specialized equipment for China’s land, sea and air forces.Perhaps the most severe and significant has been the sale of specially quieted diesel engines and related equipment for China’s newest hunter-killer Yuan-class submarines. The transfer of some 50 submarine diesel engines by Germany’s MTU, which is partially owned by the UK’s Rolls Royce Group, has given the Chinese navy a leg-up to build modern, quiet attack subs.But it does not stop there. The same company has provided about 250 or more advanced diesel engines for China’s navy, enhancing their speed, efficiency and reliability – important improvements as China builds a capable blue water navy including aircraft carriers.It is just as important that the United States not only provide strategic advice to Taiwan, but take concrete steps to make sure similar incentives from China are not waved in the face of American business and America’s technology eliteThe full story of what has been sold to China and what is directly transferring to China’s military has yet to be fully analyzed because the pro-China lobby in the United States and elsewhere has deliberately kept it all quiet or tried to explain it away. To a degree, the apparent connivance is based on the perceived "good" of keeping Western economies humming.But as the US now knows and Taiwan is beginning to figure out, there has been a tectonic power shift, especially in the Eastern Pacific and particularly with China’s successful militarization of the South China Sea, a challenge that largely has not been met by any of the players, especially the US.This may suit business interests and political leaders in the short term, most of whom have sold out to the inevitability of Chinese power, but it has grave implications for the survival of democracies in the region, from Korea, to Japan, to Taiwan, to the Philippines, and to the US ability to protect the sea lines of communications and security in the region.Now China’s bid to suck up Taiwan’s technology signifies yet another dimension of the same threat that is looming large.The big question is what Taiwan’s government will do, if anything, to intervene in such matters. It is also just as important that the United States not only provide strategic advice to Taiwan, but take concrete steps to make sure similar incentives from China are not waved in the face of American business and America’s technology elite.Taiwan has to decide where its future will be. Will it link up with China, surrender its democracy and become a dutiful province of China? Or will Taiwan take the other road and protect its independence and freedom?Taiwan cannot have it both ways or turn a blind eye to the implications of high technology transfers to China.(2) Rolls-Royce & China Yuchai jointly produce MTU engines for Submarines, with quiet diesel motors and China Yuchai to Jointly Produce MTU Engines- China Yuchai International and Rolls-Royce Power Systems to form joint venture in China- Production of MTU Series 4000 engines to start in 2017 in Yulin, China- Capacity for up to 1,500 engines a year with components produced in Germany and ChinaFeb 19, 2016, 06:00 ET from China Yuchai International LimitedFRIEDRICHSHAFEN, Germany and SINGAPORE, Feb. 19, 2016 /PRNewswire/ -- MTU Friedrichshafen GmbH ("MTU"), a subsidiary of Rolls-Royce Power Systems, and China Yuchai International Limited's main operating subsidiary, Guangxi Yuchai Machinery Company Ltd. ("GYMCL"), have today signed an agreement to set up a 50/50 joint venture for the production, under licence from MTU, of MTU diesel engines in China. Each party will invest 75 million RMB (around 10.5 million Euro) in the joint venture.The joint venture will be based at GYMCL's primary manufacturing facilities in Yulin City in Guangxi Province, south China and is expected to begin production in 2017. The joint venture will produce MTU Series 4000 diesel engines compliant with China Tier 3 emission standards with power outputs ranging from 1400 to 3490 kW, primarily for the Chinese off-highway market, in particular for power generation and oil & gas applications.The joint venture will open up new growth opportunities for both partners, particularly in China and Asia. The joint venture will enable better access to the Chinese market for the MTU Series 4000 diesel engines, via the extensive sales and service network operated by GYMCL. GYMCL will, as a result of the joint venture, be able to offer its customers technologically advanced engines that have a proven record on the global market. The joint venture engines will be marketed by GYMCL and MTU Suzhou within China and by MTU and its subsidiaries exclusively outside China. From 2020, the sales territory of GYMCL will be extended to selected countries in South East Asia such as Vietnam, Thailand and Malaysia. After a ramp-up phase of 3 to 5 years, the scope of the joint venture might (subject to further discussion) be extended to research and development activities as well as potentially direct sales from the joint venture to the customer.The establishment of the joint venture is subject to the fulfilment of certain conditions including but not limited to approvals by the relevant authorities.About China Yuchai InternationalChina Yuchai International Limited, through its subsidiary, Guangxi Yuchai Machinery Company Limited ("GYMCL"), engages in the manufacture, assembly, and sale of a wide variety of light-, medium- and heavy-duty engines for trucks, buses, passenger vehicles, construction equipment, marine and agriculture applications in China. GYMCL also produces diesel power generators. The engines produced by GYMCL range from diesel to natural gas and hybrid engines. Through its regional sales offices and authorized customer service centers, the Company distributes its engines directly to auto OEMs and retailers and provides maintenance and retrofitting services throughout China. Founded in 1951, GYMCL has established a reputable brand name, strong research and development team and significant market share in China with high-quality products and reliable after-sales support. In 2015, GYMCL sold 364,567 engines and is recognized as a leading manufacturer and distributor of engines in China. For more information, please visit Rolls-Royce Holdings plc1.Rolls-Royce's vision is to be the market-leader in high performance power systems where our engineering expertise, global reach and deep industry knowledge deliver outstanding customer relationships and solutions. We operate across five businesses: Civil Aerospace, Defence Aerospace, Marine, Nuclear and Power Systems.2.Rolls-Royce Power Systems is headquartered in Friedrichshafen in southern Germany and employs around 10,000 people. The product portfolio includes MTU-brand high-speed engines and propulsion systems for ships, power generation, heavy land, rail and defence vehicles and for the oil and gas industry. Under the MTU Onsite Energy brand, the company markets diesel gensets for emergency, base load and peak load applications as well as cogeneration plants using gas engines for the combined generation of heat and power. Bergen medium-speed engines power ships and power generation applications. L'Orange completes the portfolio with fuel injection systems for large engines.3.Rolls-Royce has customers in more than 120 countries, comprising more than 400 airlines and leasing customers, 160 armed forces, 4,000 marine customers including 70 navies, and more than 5,000 power and nuclear customers.4.We have three common themes across all our businesses:- Investing in and developing engineering excellence- Driving a manufacturing and supply chain transformation which will embed operational excellence in lean, lower-cost facilities and processes- Leveraging our installed base, product knowledge and engineering capabilities to provide customers with outstanding service through which we can capture aftermarket value long into the future.5.Annual underlying revenue was £13.4 billion in 2015, around half of which came from the provision of aftermarket services. The firm and announced order book stood at £76.4 billion at the end of 2015.6.In 2015, Rolls-Royce invested £1.2 billion on research and development. We also support a global network of 31 University Technology Centres, which position Rolls-Royce engineers at the forefront of scientific research.7.Rolls-Royce employs over 50,000 people in more than 46 countries. Nearly 15,700 of these are engineers.8.The Group has a strong commitment to apprentice and graduate recruitment and to further developing employee skills. In 2015 we employed 228 graduates and 277 apprentices through our worldwide training programmes.SOURCE China Yuchai International Limited(3) China has a list of encouraged industries; other sectors are closed to foreign investment transfers in the trenches of US-China trade warBy GIOVANNI DI LIETO |  OCTOBER 5, 2017 3:17 PM (UTC+8)Forced technology transfers are the new bone of contention in the intellectual-property battle of the impending US-China trade war. Since 1989, the Office of the United States Trade Representative (USTR) has released an annual review of the global state of intellectual property rights (IPR) protection and enforcement.The report is called "Special 301" to signify that it ultimately serves to provide the US administration with legal evidence to activate Section 301 of the Trade Act of 1974 against IPR violations.In fact, over the past two decades, the Special 301 Report has regularly put China on the Priority Watch List, in particular regard to counterfeit goods and software piracy.However, in more recent years, technology transfers have emerged as a highly contentious area of international trade policy that governments and multinational corporations can see as both limiting or enabling innovation and investment, according to their different economic circumstances.The administration of US President Donald Trump shows little doubt on which side of the fence it sits. A recent Presidential Memorandum for the USTR highlighted the importance of keeping trade secrets from China’s hands.The memorandum indeed claims that Chinese regulations "inhibit United States exports, deprive United States citizens of fair remuneration for their innovations, divert American jobs to workers in China, contribute to our trade deficit with China, and otherwise undermine American manufacturing, services, and innovation".More specifically, in the words of the 2017 Special 301 Report, China tops the Priority Watch List as it systematically "imposes requirements that US firms develop their IP in China or transfer their IP to Chinese entities as a condition to accessing the Chinese market."This shows how forced technology transfers are inherently related to the various domestic laws and international treaties regulating foreign investment. In fact, since China’s accession to the World Trade Organization (WTO) in 2001, its commercial and administrative law has been gradually easing the stringent rules that govern foreign invested entities.Last October there was a major revision of the statutes concerning wholly foreign-owned entities, equity joint ventures and contractual joint ventures, which no longer require the approval China’s Ministry of Commerce, but just a plain registration.Nevertheless, as usual the devil is in the details, as the Commerce Ministry maintains a catalogue for the Guidance of Foreign Investment Industries with a schedule of encouraged industries. In essence, this is a negative list of sectors and firms denied to foreign investment and ownership.In business-law terms, the ministerial catalogue restricts foreign firms to those corporate structures and market access requirements that enable the legal transfer of technological know-how to their Chinese partners.Add to this China’s newly introduced Cybersecurity Law, which imposes security assessments on data transfer overseas in ways that may force IPR disclosures to local firms. Furthermore, effective from June 2017, the Cybersecurity Law restricts enterprises identified as "critical information infrastructure operators" to storing data domestically.All these issues paint a picture in which the USTR is yet another step closer to taking legal action against China’s technology-transfer tactics. The defensive instrument of choice is crucial to define how the looming Sino-American trade war is going to affect the future of economic globalization.The USTR can either go multilateral by bringing the claim before the WTO Dispute Settlement Unit, or it can go solo by imposing unilateral restrictions on Chinese goods, services and investment based on the Section 301 investigation.The multilateral option seems less likely, considering Trump’s notorious change of tack in trade and industrial policy. On the other hand, the unilateral option would certainly be quicker to implement and more to the taste of trade hardliners in Trump’s administration. However, it would certainly spark Chinese commercial retaliations and thus lead to unprecedented geopolitical troubles across the Asia-Pacific region.On paper, another possible solution is reviving the stalled US-China bilateral investment treaty (BIT), so as to follow the tracks of existing free-trade agreements that include investor-state dispute settlements, such as the North American Free Trade Agreement (NAFTA).The European Union is also promoting to its major trade partners a multilateral investment court modeled on the WTO dispute-settlement mechanisms.The China BIT with further integration with the EU project could be the most balanced forum to keep the US-China trade relationship from falling apart and dragging down the world economy in the process, if only it didn’t take years if not decades to set up this kind of mechanism.However, now the reality is that President Trump is looking for legal sparks to wage a full-blown trade war with China as a sure way to leave a long-lasting legacy from his "America First" foreign-policy agenda.(4) Forced Technology Transfers To China 301: US Investigates Allegations Of Forced Technology Transfers To China08/10/2017by Zhiyao (Lucy) Lu and Gary Clyde Hufbauer, Peterson Institute for International EconomicsReprinted from the original post on the East Asia ForumOn 18 August 2017, the Trump administration invoked Section 301 of the Trade Act of 1974 to launch an investigation into alleged Chinese violations of intellectual property rights (IPR). In response, China stated that the United States ‘disregards the rules of the WTO’ and that it will ‘take all proper measures to safeguard its legitimate rights’. Alongside investigations into steel and aluminium imports, the new Section 301 case holds the potential to escalate US–China trade tensions.Counterfeit goods and software piracy have long been contentious IPR issues between the United States and China. China has appeared on every Priority Watch List in the Special 301 Report published annually by the United States Trade Representative since its first review in 1989.But in recent years, forced technology transfer has been a rising concern. According to a survey conducted by the US–China Business Council in 2015, some 59 per cent of firms were worried about transferring technology to China, although only 23 per cent had been asked to transfer technology within the past three years.To understand how China may force US firms to transfer technology to domestic enterprises, it is worth taking a look at China’s inward investment regime.Three major laws govern foreign investment into China: the Law on Sino-Foreign Equity Joint Ventures, the Law on Sino-Foreign Cooperative Joint Ventures and the Law on Wholly Foreign-Owned Enterprises. Other administrative rules on foreign investment are issued by various government agencies at the central and provincial levels, as well as by ministries supervising different industries and regions.Reflecting these major laws, the Ministry of Commerce periodically updates a catalogue for the Guidance of Foreign Investment Industries to regulate foreign investment in China. The most recent catalogue contains a list of encouraged industries, a ‘negative list’ of sectors where ownership limits or other investment restrictions apply, and a schedule of prohibited sectors.So how could China’s inward investment regime prompt IPR violations and forced transfers of technology?The first path stems from restrictions on foreign investment specified in the catalogue. Some industries, such as prospecting and exploitation of petroleum and natural gas, are limited to joint or cooperative ventures. These mandatory business structures may force US firms to transfer valuable know-how to their Chinese partners. One example might be deep sea drilling technology, another might be fracking in folded shale structures.Second, under China’s investment regime, foreign firms must generally seek prior approval from relevant regulators. Since China has multiple laws and regulations on foreign investment issued by agencies that oversee different industries and regions, the approval process lacks transparency. This creates room for government officials to impose deal-specific requirements, which may include transfer of technology as a pre-condition for market access.Third, new regulations on the information technology sector to ensure ‘secure and controllable’ standards may infringe the IPR of foreign investors. For example, the Cybersecurity Law, which came into effect on 1 June 2017, requires businesses identified as ‘critical information infrastructure operators’ to store data domestically, and transferring data overseas is subject to security assessments. Such restrictions on cross-border data flow may lead to forced IPR disclosures to local enterprises.Estimates of the cost of IP theft are highly speculative, but according to the updated IP Commission Report by the National Bureau of Asian Research, the annual cost to the US economy as a result of counterfeit and pirated tangible goods, pirated software, and trade secret theft ranges from US$225 billion to US$600 billion. The trade secret share of this range — estimated between US$180 billion and US$540 billion — is most relevant for forced technology transfer. As a major IP infringer, China (including Hong Kong) accounted for 88 per cent of US IPR seizures in 2016. The figure probably represents a good estimate of the Chinese share of forced technology transfer.The Trump administration has mixed motives in launching the Section 301 investigation. Foremost, the administration believes that reforms to the Chinese system would reduce the bilateral US trade deficit with China (US$309 billion in 2016) and create more US jobs, especially in the manufacturing sector. The administration also subscribes to arguments advanced by the US business community that the Chinese system is fundamentally unfair to foreign firms.Given these concerns, how might the United States pursue its IPR grievances with China?One avenue is to bring a case to the WTO. From the US perspective, this path faces two obstacles: the length of time and the standard of proof. The WTO Appellate Body would take at least three years to reach a final decision. It is also not at all certain that Chinese laws and regulations violate the WTO code on trade-related aspects of intellectual property rights or other WTO rules.Another avenue, preferred by hawkish voices within the administration, is to impose unilateral restrictions on Chinese exports and investment based solely on the findings of the Section 301 investigation. US imports from Chinese companies might be subject to a penalty tariff, or Chinese companies might be denied permission to acquire US firms. Unilateral penalties could, of course, lead to tit-for-tat retaliation and possibly a trade war.As a third and probably more productive avenue, the United States could resume the stalled negotiation of a bilateral investment treaty (BIT) with China. The IPR section of the BIT could draw on relevant chapters in the US–Singapore FTA and the South Korea–US FTA, which set the gold standard for IPR terms. The treaty should contain an investor–state dispute settlement mechanism to ensure effective enforcement of BIT commitments.Whatever approach is taken, changes in Chinese practices will take time. The above measures will not quickly change the dynamics of inward investment, or curb the bilateral trade imbalance. But over a decade, enhanced Chinese respect for IPR has the potential to benefit China as much, or more, than the United States.Zhiyao (Lucy) Lu is a research analyst and Gary Clyde Hufbauer is Reginald Jones Senior Fellow at the Peterson Institute for International Economics (US).(5) Vietnam turns to USA to counter China bullying Vietnam welcomes America’s returnUSS Carl Vinson aircraft carrier's historic docking at Da Nang draws the one-time adversaries into a new and risky strategic embraceBy PHAM CHI DUNG |  HO CHI MINH CITY, MARCH 6, 2018With the USS Carl Vinson’s arrival this week in Da Nang, the first port of call of an American aircraft carrier to the country since the end of the Vietnam War in 1975, the two former battlefield adversaries have taken yet another symbolic step in drawing closer together.The giant American naval vessel’s docking comes shortly after US Defense Secretary James Mattis visited Hanoi on January 24, just days after the Pentagon released a new National Defense Strategy (NDS), a policy shift that openly identifies China as a "strategic competitor" in need of a counterbalancing.Vietnam had arguably arrived at a similar policy conclusion in mid-2017, when many in the country’s Communist Party leadership, including in the powerful Politburo, recognized the strategic need to lean more towards the US and way from China due to heated developments in the contested South China Sea.Vietnam’s less openly apparent policy shift came despite still strong skepticism about the US and its intentions among certain power-wielding Party elites, not least among them Communist Party General Secretary Nguyen Phu Trong and Defense Minister Ngo Xuan Lich. Trong in particular is viewed as being close to China.But a series of standoffs with China in nearby waters, including areas known to be rich in oil and gas, has driven the strategic recalibration towards the US. Those sea showdowns intensified in mid-2014, when China deployed a massive oil exploration rig, known as the Haiyang Shiyou 981, in Vietnamese claimed waters.During that three-month standoff, Vietnam’s strategic partners, including key arms supplier Russia, turned away rather than dare to confront Beijing. Nor did Vietnam’s Politburo or National Assembly issue a resolution of condemnation, viewed by many as a face-losing humiliation.Then US Pacific Commander Admiral Samuel Locklear, however, suggested at the time that the two sides work to develop a deeper strategic partnership to extend what was then only mild military cooperation, hindered largely by a lethal arms embargo held over from the Vietnam War.Those US overtures were by and large ignored, however. Meanwhile, Party leader Trong, known for his close ideological ties and open lines to China, reportedly called Chinese President Xi Jinping nearly 20 times to speak about the tensions around the oil rig but the Chinese leader apparently declined to receive his calls.Angry nationalistic protestors later targeted Chinese interests in the country, including in industrial areas, forcing Beijing to evacuate hundreds of its nationals. An estimated 21 Chinese nationals were killed and hundreds injured in the melees, according to a The Guardian report.Vietnam’s tightrope balancing act between China and the US wobbled further amid Beijing’s assertiveness in the South China Sea in 2017, including around the oil and gas rich Vanguard Bank. Chinese ships intensified their provocations and even shot at Vietnamese fishing boats in the area.In October 2017, Deputy Defense Minister Senior Lieutenant General Nguyen Chi Vinh was the next senior Vietnamese officer to visit Washington. In a meeting with former prisoner of war and current US Senator John McCain, Vinh delivered the letters McCain’s relatives sent to him while he was detained at Hao Lo prison.Despite years of diplomatic warming, often spearheaded by McCain himself, Vietnam had until then held onto the family letters. But there is much more at stake for Vietnam in gravitating toward the US than war era reconciliation.In early 2017, Prime Minister Nguyen Xuan Phuc warned of a possible "collapse" of the national fiscal budget, driven in part by a drastic fall in oil export revenues caused by lower global prices and fast declining local output.Since 2015, Vietnam’s revenues from crude oil exports have fallen by some 40%. Some industry analysts have estimated Vietnam may run out of oil reserves altogether as early as 2021, the year Vietnam will hold its next five yearly Communist Party Congress. To many in the Party, China threatens to make that dire fiscal situation worse.  Last July, China pressured Vietnam into suspending joint oil and gas exploration with Spanish energy company Respol around the Vanguard Bank area, which Vietnam claims as part of its sovereign territory.According to international media reports, China had threatened to attack Vietnamese military outposts in the Spratly Islands if Respol continued its exploration activities.Vietnamese officials fear the Blue Whale field, currently being developed in a joint venture between US energy giant ExxonMobil (64% operating stake) and state-run PetroVietnam, could be China’s next target for intimidation.The off-shore field, known in Vietnamese as Ca Voi Xanh, is estimated to hold reserves of anywhere between 85 to 283 billion cubic feet of gas reserves. The companies have announced they expect to produce the first gas for power generation by 2023.Vietnam has said revenues from the field could earn as much as US$20 billion for the national budget over the life of the project.While the US certainly has a commercial interest in the Blue Whale project (it was signed in the presence of then US Secretary of State John Kerry), the deployment and docking of the USS Carl Vinson has much wider strategic implications, as outlined in the Pentagon’s new NDS.While the NDS identifies five major challenges to US national security interests, namely (1) China, (2) Russia, (3) North Korea, (4) Iran, and (5) terrorism, the policy reorientation is expected to focus particularly on the Asia-Pacific, including maintaining freedom of navigation in the South China Sea.Beijing has voiced its concerns that the US is bidding to "encircle" its interest through an emerging network of regional alliances and initiatives. China’s critics say it is bidding to turn the maritime area, through which over US$5 trillion of global trade passes every year, into a Beijing-controlled "toll station" for international shippers.They believe Chinese President Xi Jinping, now vying to extend his tenure beyond traditional term limits, could move more aggressively in the area after the completion of this month’s Communist Party Congress, in a bid to deflect attention from his power play by stoking nationalistic fires.If so, Vietnam-claimed areas of the Spratly islands, a close target geographically for China’s emerging forces in the area, could quickly emerge as a new regional flash point. Tensions are already brewing in the area.In August 2016, Reuters cited "intelligence" information in reporting that Vietnam had test-launched missiles in five areas of the Spratlys, which if true would have been meant as a clear provocation towards China.In a media interview, Deputy Defense Minister Vinh neither confirmed nor denied the test launches occurred. Strategic analysts saw the move as a counter to China’s test launch of missiles at the contested Woody Island in the Paracel Islands in 2015.Vietnamese (R) and U.S. naval officers talk during a welcoming ceremony to the U.S. aircraft carrier USS Carl Vinson after it docked at a port in Danang, Vietnam March 5, 2018. REUTERS/Kham Vietnamese (R) and US naval officers during a welcoming ceremony to the US aircraft carrier USS Carl Vinson after it docked at a port in Danang, Vietnam March 5, 2018. Photo: Reuters/Kham Whether the US would be willing to intervene in a China versus Vietnam conflict in the name of maintaining freedom of navigation is unclear.What is clear is that the US and Vietnamese defense establishments are keen to develop deeper strategic ties, including via more naval exchanges, small weapons sales and the future establishment of a joint military drill mechanism.In 2013, three US warships docked at Da Nang with considerable less fanfare than the USS Carl Vinson’s visit to carry out routine "naval exchanges" with Vietnamese naval counterparts.Since 2016, Vietnam has ignored at least three instances when US warships have traveled near the Paracel islands in an indirect challenge to China’s claim over the contested archipelago in the South China Sea.On two of those occasions, Vietnam’s Ministry of Foreign Affairs said in public statements that the American vessels’ presence in the area was harmless and that "US ships have right of freedom in the South China Sea."It’s warm welcome of the USS Carl Vinson now underway at Da Nang, a clear sign of Vietnam’s shifting policy position between the US and China, will have further underscored that point.(6) China's Silent Invasion of Australia - Clive Hamilton agents are undermining Australia's sovereignty, Clive Hamilton's controversial new book claimsBy Dylan WelchUpdated February 22, 2018 15:52:16Thousands of agents of the Chinese state have integrated themselves into Australian public life — from the high spheres of politics, academia and business all the way down to suburban churches and local writers' groups — according to a controversial book to be published on Monday.The book, Silent Invasion: How China Is Turning Australia into a Puppet State, is written by Clive Hamilton, professor of public ethics at Charles Sturt University.In it, he alleges that a systematic Chinese government campaign of espionage and influence peddling is leading to "the erosion of Australian sovereignty".That erosion is caused, in part, by a recent wave of Chinese migration to Australia including "billionaires with shady histories and tight links to the [Chinese Communist] party, media owners creating Beijing mouthpieces, 'patriotic' students brainwashed from birth, and professionals marshalled into pro-Beijing associations set up by the Chinese embassy," Professor Hamilton writes.ABC News has been given a pre-publication copy of the book, which is being published in the middle of widening public debate over China's influence in Australia and concerns Beijing has thousands of unofficial "spies" in the country.Those concerns were given some credence by the Government late last year, when Prime Minister Malcolm Turnbull announced he planned to enact new foreign interference laws to counter such espionage.Mr Turnbull used strong language at the time, paraphrasing a famous Chinese communist slogan to say Australia would "stand up" to foreign governments meddling in Australian affairs.The book will cause particular angst among Australia's political class.It lists more than 40 former and sitting Australian politicians who Professor Hamilton says are doing the work of China's totalitarian Government, if sometimes unwittingly. Many are household names."[Former prime ministers Bob] Hawke and [Paul] Keating, when their political careers ended they went on to become reliable friends of China, shuttling between the two countries, mixing with the top cadres and tycoons," Professor Hamilton writes."While Hawke's China links proved lucrative, Keating was more interested in influence."'Beijing Bob'An entire chapter, titled Beijing Bob, is dedicated to former Labor foreign minister and NSW premier Bob Carr.The chapter accuses Mr Carr of "pushing an aggressive pro-China stance in Labor caucuses".Professor Hamilton chronicles Mr Carr's 2015 appointment as the founding director of the Australia-China Research Institute (ACRI) at the University of Technology, Sydney.ACRI was created with a $1.8m donation from billionaire property developer Huang Xiangmo, who has donated millions to Australian politicians and has been described in the book as being one of Beijing's most powerful agents of influence in Australia."Huang sits at the centre of a web of influence that extends throughout politics, business and the media," Professor Hamilton writes.Mr Huang has been the subject of public speculation ever since the ABC News revealed his millions of dollars in political donations, and his questionable connections to senior federal politicians, in a series of stories in 2015, 2016 and 2017."Let's call the Australia-China Research Institute for what it is," Professor Hamilton writes."A Beijing-backed propaganda outfit disguised as a legitimate research institute, whose ultimate objective is to advance the CCP's [Chinese Communist Party's] influence in Australian policy and political circles, an organisation hosted by a university whose commitment to academic freedom and proper practice is clouded by money hunger, and directed by an ex-politician suffering from relevance deprivation syndrome who cannot see what a valuable asset he has become for Beijing."Mr Huang denies his donations and influence within Australian society are connected to the Chinese Government, describing the allegations as innuendo and racism.Mr Carr, who declined to comment for this article, has previously said ACRI took a "positive and optimistic view" of the Australia-China relationship and was "independent" and "non-partisan". He rejected any suggestion he was working with or for the CCP or its proxies.The book also details a list of Chinese-Australian academics whom Professor Hamilton says are allowing the transfer of potentially national security-significant research — in sensitive areas such as space, artificial intelligence and computer engineering — from Australian universities to the Chinese military.Silent Invasion appears to have also divided Australian Parliament, with Labor and Liberal members of a classified parliamentary committee at odds over whether they should provide legal cover for the book.Plans were hatched recently by members of Parliament's intelligence oversight body, the Parliamentary Joint Committee on Intelligence and Security (PJCIS), to publish a digital copy of the book.The release would have been the first time the Australian parliament published a book in its entirety — therefore granting it a limited form of parliamentary privilege — in an effort to protect the information it contains from legal attack.While Liberal members of the committee broadly supported publication of the book, the majority of Labor committee members did not, arguing it was not appropriate for the Australian Parliament to give the book its imprimatur.Silent Invasion was provided to the committee in a submission as part of an inquiry into Mr Turnbull's foreign interference laws.The book's release by the committee would have been seen as an inflammatory act by Beijing, already smarting from Mr Turnbull's announcement.Co-opting GodIn another section of the book, Professor Hamilton describes a curious relationship between Chinese Christian churches in Australia and the atheist Chinese Communist Party, which has a history of supressing Christianity at home.He refers to classified Chinese Government reports which instruct Chinese officials to infiltrate overseas churches that have Chinese congregations. "They instruct cadres to monitor, infiltrate and 'sinify' overseas Chinese churches by actively promoting the CCP's concepts of Chineseness and 'spiritual love'."In 2014, he notes, the website of the Canberra Chinese Methodist Church included a statement which linked the rise of the CCP to God's will: "The awe-inspiring righteousness of Xi Jinping, the President of the People's Republic of China, and the rise of a great nation that is modern China are part of God's plan, predestination and blessing."Many Chinese church pastors believe their congregations have been penetrated by Chinese Government cadres, Professor Hamilton writes."One pastor told me: 'There are lots of communists in our church community.' He guessed that around a quarter or a third are or have been communists. Some join the church for the companionship, some for the social contacts; others are the [Chinese Government's] assets."The manuscript also alleges that people connected to the Chinese Government have infiltrated Australia's writing scene. It states that a group called the Australian-Chinese Writer's Association was recently taken over by "pro-Beijing forces".Professor Hamilton describes how well-known Australian writing forums such as the Melbourne Writers Festival and Writers Victoria have unwittingly hosted local Chinese writing groups operating under Beijing's control and "whose aim is to spread into Australian society the CCP worldview, one that is extremely intolerant of artistic license and dissenting views."A 'landmark win' for ChinaSilent Invasion is so controversial it almost didn't make it to publication. It was due to be released late last year by Allen & Unwin, but the publisher baulked over concerns it would be targeted by Beijing and its proxies in Australia. Melbourne University Press also turned down the book.That led Professor Hamilton — the author of half-a-dozen books about climate change, politics and economics — to hit out at what he described as an attempt by the CCP to muzzle public debate in Australia."[This is a] landmark win for the Chinese Communist Party's campaign to suppress critical voices," Professor Hamilton wrote to Allen & Unwin chief executive Robert Gorman at the time.The book was recently acquired by Hardie Grant, run by Sandy Grant, who in the 1980s published the controversial memoir of former British intelligence officer Peter Wright. The publication occurred against the wishes of the British government, which was trying to censor the book.Mr Grant told the ABC he was aware publishing Silent Invasion may invite the attention of the Chinese Government, but he hoped it would not be serious. "This is a debate being held at the ABC, the New York Times, the London Times; we are just one voice in that, we are hardly a serious thorn in the Chinese Government's side," he said.Professor Hamilton may also have reason to be concerned about the impact of authoring the book. This week New Zealand Prime Minister Jacinda Ardern ordered intelligence officers to investigate break-ins at the home and office of prominent NZ China academic Anne-Marie Brady.Professor Brady has spent her career researching China's global influence and her 2017 paper, Magic Weapons, caused global waves when it revealed how deeply China had penetrated NZ's Government.-- Peter Myerswebsite: