The Official Chinese 🇨🇳 Espionage & Cold War Thread
Taiwan records scores of Chinese warplanes near island – DW – 09/14/2023
The defense ministry in Taipei reported dozens of Chinese jets and 10 naval ships near Taiwan.
www.dw.com
NSA plans new ‘innovation pipeline’ to focus on China | Federal News Network
The new concept, “Red Ventures,” will help the NSA coordinate both internal ideas and work with outside partners on technology innovation.
federalnewsnetwork.com
/cloudfront-us-east-2.images.arcpublishing.com/reuters/C6BAM7ZIHJND7L3VZH7G7KK4X4.jpg)
China's defence minister, not seen in weeks, skipped Vietnam meet
Chinese defence minister Li Shangfu abruptly pulled out of a meeting with Vietnamese defence leaders last week, three officials with direct knowledge of the matter said, amid questions about his more than two-weeks-long absence from public view.
www.reuters.com
China's defense minister not seen for two weeks
Rumors swirl over allegations of misconduct
asia.nikkei.com
Hypersonic Missiles Are Game-Changers, and America Doesn’t Have Them
The U.S. military is pouring resources into the superfast weapons but has struggled to develop them. China and Russia are far ahead.
www.wsj.com
ADevilYouKhow
Rhyme Reason
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Turkey’s Roketsan wins Malaysian deal for Karaok anti-tank missiles
An industry source estimated the contract price at around $20 million.
www.defensenews.com
ADevilYouKhow
Rhyme Reason
ADevilYouKhow
Rhyme Reason
In Risky Hunt for Secrets, U.S. and China Expand Global Spy Operations
The nations are taking bold steps in the espionage shadow war to try to collect intelligence on leadership thinking and military capabilities.
In Risky Hunt for Secrets, U.S. and China Expand Global Spy Operations
The nations are taking bold steps in the espionage shadow war to try to collect intelligence on leadership thinking and military capabilities.
EU warns of ‘possible’ Chinese retaliation over electric car probe | Financial Times
Brussels is wary that Beijing could target specific sectors in individual countries of the bloc
www.ft.com
EU warns of ‘possible’ Chinese retaliation over electric car probe
Brussels is wary that Beijing could target specific sectors in individual countries of the bloc
A BYD Seal electric car at the Munich Motor Show
The EU’s anti-subsidy investigation could lead to higher tariffs on Chinese imports such as those by carmaker BYD © Krisztian Bocsi/Bloomberg
The EU’s anti-subsidy investigation into China’s electric-car industry could provoke retaliatory measures from Beijing, senior EU officials have warned, even as the bloc’s ministers said the probe was crucial for safeguarding trade rules.
“We have to address this issue seriously,” Paolo Gentiloni, the EU’s economy commissioner, told reporters at a two-day meeting of EU finance ministers in Santiago de Compostela, Spain. “I think there’s no specific reason for retaliation [from Beijing], but retaliation is always possible.”
European Commission president Ursula von der Leyen said on Wednesday that Brussels would investigate Chinese electric vehicles on concerns that they were “distorting” the EU market, a probe that could constitute one of the largest trade cases launched given the scale of the market.
The months-long probe, which could lead to higher tariffs on Chinese imports, is aimed at buying more time for Europe’s legacy carmakers to adapt to the green transition as China’s battery-powered models threaten to swamp the growing market.
The move comes as the EU strives to find a balance in its wider strategy towards China, with Brussels seeking to treat Beijing as a rival in economic and geopolitical terms, but also as a key trade partner for many of its member states and a critical part of its green technology supply chains.
“We’re emboldened and feel like we shouldn’t shy away from a fight with them on this. We are quite confident that if there are moves from the Chinese side, then we have the strength to respond to that,” said a senior EU official of the attitude inside the EU’s executive arm.
“The bigger concern is what would happen internally if China targeted individual business sectors in individual countries,” the official added.
European Commission president Ursula von der Leyen delivers her State of the Union speech on Wednesday
European Commission president Ursula von der Leyen announced the probe during her annual address to EU lawmakers on Wednesday © Julien Warnand/EPA-EFE/Shutterstock
Valdis Dombrovskis, the EU’s trade commissioner, who is set to travel to Beijing next week for previously arranged talks, said the investigation would be “fact-based”.
“We are just at the start of a fact-based investigation when we will consult extensively, including with Chinese authorities and industry. We will now follow this well-established process through, one step at a time,” Dombrovskis said.
“We welcome global competition because it makes our companies stronger. But competition must be fair. This is why engaging with China on this issue is essential, and I look forward to meeting my Chinese counterparts next week in Beijing,” he added.
China’s commerce ministry on Thursday called the probe “a naked protectionist act that will seriously disrupt and distort the global automotive industry and supply chain . . . and will have a negative impact on China-EU economic and trade relations”.
“China will pay close attention to the EU’s protectionist tendencies and follow-up actions, and firmly safeguard the legitimate rights and interests of Chinese companies,” it said in a statement.
The issue will be discussed by EU finance ministers at Santiago de Compostela, where reforms of the bloc’s fiscal rules and the future leadership of the European Investment Bank are also set to be debated.
“We just want everybody to abide by the same [trade] rules, that’s it. Nothing against China,” said Bruno Le Maire, France’s finance minister, as he arrived at the meetings on Friday. “This decision has been taken . . . to protect the interests of the European economy.”
Christian Lindner, Germany’s finance minister, also endorsed the commission’s investigation, and said it was important that all countries abide by international trade rules.
German carmakers in particular have enjoyed a strong position in China’s car market, but they have recently come under pressure from electric models produced by Chinese brands.
/cloudfront-us-east-2.images.arcpublishing.com/reuters/BTCA27QNYNLD3N3F5HH2473FXQ.jpg)
TSMC tells vendors to delay chip equipment deliveries, sources say
Taiwan's TSMC has told its major suppliers to delay the delivery of high-end chipmaking equipment, as the world's top contract chipmaker grows increasingly nervous about customer demand, two sources familiar with the matter said.
www.reuters.com
TSMC tells vendors to delay chip equipment deliveries, sources say
Taiwan's TSMC has told its major suppliers to delay the delivery of high-end chipmaking equipment, as the world's top contract chipmaker grows increasingly nervous about customer demand, two sources familiar with the matter said.
www.reuters.com
TSMC tells vendors to delay chip equipment deliveries, sources say
Sam NusseySeptember 15, 20235:54 AM EDTUpdated 2 days ago
Illustration shows TSMC logo
A smartphone with a displayed TSMC (Taiwan Semiconductor Manufacturing Company) logo is placed on a computer motherboard in this illustration taken March 6, 2023. REUTERS/Dado Ruvic/Illustration/File Photo Acquire Licensing Rights
TOKYO/SINGAPORE/AMSTERDAM, Sept 15 (Reuters) - Taiwan's TSMC (2330.TW) has told its major suppliers to delay the delivery of high-end chipmaking equipment, as the world's top contract chipmaker grows increasingly nervous about customer demand, two sources familiar with the matter said.
Shares in TSMC suppliers including Dutch-based ASML (ASML.AS) declined following the Reuters report.
The instruction by TSMC, which is grappling with delays at its $40 billion chip factory in Arizona, is aimed at controlling costs and reflects the company's growing caution about the outlook for demand, the sources said.
Suppliers currently expect the delay to be short-term, the sources said, declining to be named as the information is not public.
TSMC said it does not comment on what it called "market rumour".
The company referred Reuters to comments by CEO C.C. Wei in July that weaker economic conditions, a slower recovery in China and softer end-market demand is making customers more cautious and more mindful of controlling inventory.
Companies affected by the instruction to delay include ASML, which makes lithography equipment essential for high-end chipmaking, one of the sources said.
In an interview with Reuters last week, ASML CEO Peter Wennink said some orders for its high-end tools have been pushed back, without saying who by, and that he expected it would be a "short-term management" issue.
ASML, Europe's most valuable tech listed company, is operating at maximum capacity and overall sales are forecast to grow 30% this year.
"We've had several (news) reports about fab readiness. Not only in Arizona ... but also in Taiwan," Wennink told Reuters, referring to preparations for chip manufacturing.
Shares in ASML declined 2.5%, making the company the biggest loser in the euro zone STOXXE50 (.STOXX50E) index.
ASM International (ASMI.AS), a smaller equipment firm that is also a supplier to TSMC, fell 5.6%, with BE Semiconductor (BESI.AS), a packaging equipment firm, down 3.3%.
Major U.S. semiconductor firms Applied Materials (AMAT.O) , KLA Corp (KLAC.O)and Lam Research (LRCX.O) were all down between 2.2% and 2.6% in premarket trading.
Analyst Michael Roeg of Degroof Petercam said he was not surprised by the selloff.
"There has been a lot of excitement about artificial intelligence and the implications for the semiconductor industry," he said, adding that AI was positive for TSMC, which makes chips for NVIDIA (NVDA.O).
"However the strength in demand for AI chips is not strong enough to compensate (for) what is happening in other segments."
He cited mobile phone, laptop, industrial and more recently automotive chips as problem areas. "That's a lot of end markets that are sluggish," he said.
DOUBLE WHAMMY
TSMC has been forced to push back production at the Arizona plant by a year to 2025, as it struggled to recruit workers and faced pushback from unions on efforts to bring in workers from Taiwan.
"If you ship a lot of people from Taiwan to help build a factory in Arizona, they're not working somewhere else. So this is kind of a double whammy," Wennink said.
TSMC Chairman Mark Liu said last week there had been "tremendous" improvement at the Arizona site in the last five months.
The Taiwanese chip giant is not alone in worrying a bounceback in demand may take longer than expected.
Apple (AAPL.O), a key TSMC customer, launched a new series of iPhones this week that included a faster chip, but it did not raise prices, reflecting the global smartphone slump.
Media reports that Beijing has ordered some government employees to stop using iPhones at work, and the launch by tech firm Huawei of a flagship phone using Chinese-made chips, is causing further unease at TSMC, one of the sources said.
TSMC used to make chips for Huawei but suspended supplies after Washington imposed sanctions on the Chinese firm. Analysts have found Huawei worked with Chinese contract chipmaker Semiconductor Manufacturing International Corp (SMIC) (0981.HK) to manufacture an advanced chip for its latest smartphone.
TSMC forecast in July a 10% slide in 2023 sales and as much as a 4% point drop in operating margin this quarter from the previous quarter, citing weak demand for smartphones and PCs and uncertainty about the market for artificial intelligence.
The chipmaker is also facing elevated capital expenditure, which increased 21% to $36 billion last year, from expansion plans put in place during the pandemic-driven chips boom.
It estimated in July that investment spending for this year would be at the lower end of a previous forecast of $32 billion to $36 billion, and said it expected a slower increase in the next few years.
Reporting by Sam Nussey in Tokyo, Fanny Potkin in Singapore and Toby Sterling in Amsterdam; Editing by Miyoung Kim and Stephen Coates
Our Standards: The Thomson Reuters Trust Principles.
Acquire Licensing Rights
In Risky Hunt for Secrets, U.S. and China Expand Global Spy Operations
The nations are taking bold steps in the espionage shadow war to try to collect intelligence on leadership thinking and military capabilities.
In Risky Hunt for Secrets, U.S. and China Expand Global Spy Operations
The nations are taking bold steps in the espionage shadow war to try to collect intelligence on leadership thinking and military capabilities.
Sept. 17, 2023Updated 11:19 a.m. ET
An illustration of a red balloon with the Chinese flag hanging a satellite over the White House. A telescope on top of the White House is looking up at the balloon as military airplanes fly by.
Illustration by Chantal Jahchan; photographs by Getty Images
Illustration by Chantal Jahchan; photographs by Getty Images
By Julian E. Barnes and Edward Wong
Julian E. Barnes, who covers the U.S. spy agencies, and Edward Wong, a diplomatic correspondent and The Times’s former Beijing bureau chief, have reported together on China intelligence issues for five years.
As China’s spy balloon drifted across the continental United States in February, American intelligence agencies learned that President Xi Jinping of China had become enraged with senior Chinese military generals.
The spy agencies had been trying to understand what Mr. Xi knew and what actions he would take as the balloon, originally aimed at U.S. military bases in Guam and Hawaii, was blown off course.
Mr. Xi was not opposed to risky spying operations against the United States, but American intelligence agencies concluded that the People’s Liberation Army had kept Mr. Xi in the dark until the balloon was over the United States.
American officials would not discuss how spy agencies gleaned this information. But in details reported here for the first time, they discovered that when Mr. Xi learned of the balloon’s trajectory and realized it was deratiling planned talks with Secretary of State Antony J. Blinken, he berated senior generals for failing to tell him that the balloon had gone astray, according to American officials briefed on the intelligence.
The episode threw a spotlight on the expanding and highly secretive spy-versus-spy contest between the United States and China. The balloon crisis, a small part of a much larger Chinese espionage effort, reflects a brazen new aggressiveness by Beijing in gathering intelligence on the United States as well as Washington’s growing capabilities to collect its own information on China.
For Washington, the espionage efforts are a critical part of President Biden’s strategy to constrain the military and technological rise of China, in line with his thinking that the country poses the greatest long-term challenge to American power.
For Beijing, the new tolerance for bold action among Chinese spy agencies is driven by Mr. Xi, who has led his military to engage in aggressive moves along the nation’s borders and pushed his foreign intelligence agency to become more active in farther-flung locales.
President Xi Jinping of China, wearing a black suit and blue tie, sits at a conference table. A wire from a translation device runs from his ear.
President Xi Jinping of China has led his military to engage in aggressive moves along the nation’s borders and pushed his foreign intelligence agency to become more active in farther-flung locales.Marco Longari/Agence France-Presse — Getty Images
The main efforts on both sides are aimed at answering the two most difficult questions: What are the intentions of leaders in the rival nation, and what military and technological capabilities do they command?
American officials, most of whom spoke on condition of anonymity to discuss espionage, have stressed in interviews throughout the year the magnitude of the challenge. The C.I.A. is focusing on Mr. Xi himself, and in particular his intentions regarding Taiwan. The F.B.I.’s counterintelligence task forces across the nation have intensified their hunt for Chinese efforts to recruit spies inside the United States. U.S. agents have identified a dozen penetrations by Chinese citizens of military bases on American soil in the last 12 months.
Both countries are racing to develop their artificial intelligence technology, which they believe is critical to maintaining a military and economic edge and will give their spy agencies new capabilities.
Taken together, U.S. officials say, China’s efforts reach across every facet of national security, diplomacy and advanced commercial technology in the United States and partner nations.
The C.I.A. and the Pentagon’s Defense Intelligence Agency have set up new centers focused on spying on China. U.S. officials have honed their capabilities to intercept electronic communications, including using spy planes off China’s coast.
The spy conflict with China is even more expansive than the one that played out between the Americans and the Soviets during the Cold War, said Christopher A. Wray, the F.B.I. director. China’s large population and economy enable it to build intelligence services that are bigger than those of the United States.
“The fact is that compared to the P.R.C., we’re vastly outnumbered on the ground, but it’s on us to defend the American people here at home,” Mr. Wray said in an interview, using the initials for the People’s Republic of China. “I view this as the challenge of our generation.”
China sees it differently. Wang Wenbin, a Chinese Foreign Ministry spokesman, has said that “it is the U.S. that is the No. 1 surveillance country and has the largest spy network in the world.”
‘Going After Everything’
Espionage can halt a slide into war or smooth the path of delicate negotiations, but it can also speed nations toward armed conflict or cause diplomatic rifts.
In late February, weeks after he canceled an important trip to Beijing over the balloon episode, Mr. Blinken confronted China’s top diplomat with a U.S. intelligence assessment that Beijing was considering giving weapons to Russia. That disclosure raised tensions, but also might be keeping China from sending the arms, U.S. officials say. And when Mr. Blinken finally went to Beijing in June, he raised the issue of Chinese intelligence activities in Cuba.
China’s vastly improved satellite reconnaissance and its cyberintrusions are its most important means of collecting intelligence, U.S. officials say. The fleet of spy balloons, though far less sophisticated, has allowed China to exploit the unregulated zone of “near space.” And the U.S. government is warning allies that China’s electronic surveillance capabilities could expand if the world’s nations use technology from Chinese communications companies.
Part 2:
An image of an exploded white balloon with smoke in a blue sky.
China has suspended its spy balloon program since one floated off course over the continental United States and was shot down off the coast of South Carolina in February.Randall Hill/Reuters
Artificial intelligence is another battleground. The U.S. government sees its lead in A.I. as a way to help offset China’s strength in numbers. Chinese officials hope the technology will help them counter American military power, including by pinpointing U.S. submarines and establishing domination of space, U.S. officials say.
American officials are also more concerned than ever at Chinese agencies’ efforts to gather intelligence through personal contacts. They say China’s main intelligence agency, the Ministry of State Security, aims to place agents or recruit assets across the U.S. government, as well as in technology companies and the defense industry.
Chinese agents use social media sites — LinkedIn in particular — to lure potential recruits. Any time an American takes a publicly disclosed intelligence job, they can expect a barrage of outreach from Chinese citizens on social media, according to current and former officials.
Responding to that threat, federal agencies have quietly opened or expanded their in-house spy catching operations. And Mr. Wray said the F.B.I. has thousands of open Chinese intelligence investigations, and every one of its 56 field offices has active cases. All of those field offices now have counterintelligence and cyber task forces largely focused on the threat from Chinese intelligence.
Those investigations involve attempts by Chinese spies to recruit informants, steal information, hack into systems and monitor and harass Chinese dissidents in the United States, including using so-called police outposts.
“They’re going after everything,” Mr. Wray said. “What makes the P.R.C. intelligence apparatus so pernicious is the way it uses every means at its disposal against us all at once, blending cyber, human intelligence, corporate transactions and investments to achieve its strategic goals.”
But critics say some of the U.S. government’s counterintelligence efforts are racially biased and paranoid, amounting to a new Red Scare — a charge at least partly supported by the cases the Justice Department has had to drop and by its shutdown of the Trump-era China Initiative program.
China has undertaken its own expansive counterintelligence crusade, one that echoes Mao-era political campaigns. On July 1, China enacted a sweeping expansion of a counterespionage law. And in August, the Ministry of State Security announced that “all members of society” should help fight foreign spying, and offered rewards for anyone providing information.
The rival governments have also established new listening posts and secret intelligence-sharing agreements with other governments. American and Chinese agents have intensified their operations against each other in pivotal cities, from Brussels to Abu Dhabi to Singapore, with each side looking to influence foreign officials and recruit well-placed assets.
An image of Mr. Xi is seen on a giant screen in the middle of a display of Chinese military assets such as warships and planes at a military museum in Beijing.
Some U.S. officials think Mr. Xi’s authoritarian governance style gives intelligence agencies an opening to recruit disaffected Chinese citizens.Florence Lo/Reuters
For American spy agencies, Mr. Xi’s decisions and intentions are arguably the most valuable intelligence they seek, but he is also the most elusive of targets.
U.S. agencies are now probing exactly why China’s defense minister, Gen. Li Shangfu, appears to have been placed under investigation for corruption, and why Mr. Xi ousted Qin Gang, his foreign minister. American diplomacy and policy depend on knowing the motivations behind these moves.
A decade ago, the United States’ network of informants in China was eliminated by Chinese counterintelligence officials after the informants’ identities were uncovered. Since then, the C.I.A. has faced a major challenge to rebuild its network. That is partly because China’s expanding webs of electronic surveillance have made it difficult for American case officers to move freely in China to meet contacts.
China even has artificial intelligence software that can recognize faces and detect the gait of an American spy, meaning traditional disguises are not enough to avoid detection, according to a former intelligence official. American operatives now must spend days rather than hours taking routes to spot any tailing Chinese agents before meeting a source or exchanging messages, former intelligence officials say.
And Mr. Xi, like other authoritarian leaders, limits his use of phones or electronic communications, for the very purpose of making it difficult for foreign intelligence agencies to intercept his orders.
But officials in the vast bureaucracy under Mr. Xi do use electronic devices, giving U.S. agencies a chance to intercept information — what spies call signals intelligence — to give them some insight into the internal discussions of their Chinese counterparts.
In the balloon incident, the C.I.A. began tracking the balloon in mid-January, when the Chinese army launched it from Hainan Island, officials said.
U.S. officials also determined that commanders on the Central Military Commission that Mr. Xi chairs were unaware of this particular flight until it was tipping into crisis, and they vented their frustration at the generals overseeing the surveillance program.
Since that crisis, China has paused the operations of its fleet of balloons, but American officials said they believe Beijing will likely restart the program later.
William J. Burns, wearing a gray suit and red tie, standing in the Rose Garden of the White House.
William J. Burns, the C.I.A. director, has ordered an expansion of intelligence collection and analysis of China.Drew Angerer/Getty Images
Under William J. Burns, the C.I.A. director since 2021, the agency has hired more China experts, increased spending on China-related efforts and created a new mission center on China. And while American officials refuse to discuss details of the agency’s network of informants, Mr. Burns said publicly in July that it had made progress on rebuilding a “strong human intelligence capability.”
While it is unclear how robust the new network is, some U.S. officials think Mr. Xi’s extremely authoritarian governance style gives intelligence agencies an opening to recruit disaffected Chinese citizens, including from among the political and business elite who had benefited in previous decades from less party control and a less ideological leadership.
Some prominent Chinese figures, including “princelings” of Communist Party elite families, say in private conversations that they disagree with the turn China has taken.
China has also poured resources into determining the thinking of top American officials. A Justice Department indictment unsealed in July suggests Chinese businesspeople tied to the government were trying to recruit James Woolsey, a former C.I.A. director who was in the running to be a Trump administration national security cabinet official right after the 2016 election.
An image of an exploded white balloon with smoke in a blue sky.
China has suspended its spy balloon program since one floated off course over the continental United States and was shot down off the coast of South Carolina in February.Randall Hill/Reuters
Artificial intelligence is another battleground. The U.S. government sees its lead in A.I. as a way to help offset China’s strength in numbers. Chinese officials hope the technology will help them counter American military power, including by pinpointing U.S. submarines and establishing domination of space, U.S. officials say.
American officials are also more concerned than ever at Chinese agencies’ efforts to gather intelligence through personal contacts. They say China’s main intelligence agency, the Ministry of State Security, aims to place agents or recruit assets across the U.S. government, as well as in technology companies and the defense industry.
Chinese agents use social media sites — LinkedIn in particular — to lure potential recruits. Any time an American takes a publicly disclosed intelligence job, they can expect a barrage of outreach from Chinese citizens on social media, according to current and former officials.
Responding to that threat, federal agencies have quietly opened or expanded their in-house spy catching operations. And Mr. Wray said the F.B.I. has thousands of open Chinese intelligence investigations, and every one of its 56 field offices has active cases. All of those field offices now have counterintelligence and cyber task forces largely focused on the threat from Chinese intelligence.
Those investigations involve attempts by Chinese spies to recruit informants, steal information, hack into systems and monitor and harass Chinese dissidents in the United States, including using so-called police outposts.
“They’re going after everything,” Mr. Wray said. “What makes the P.R.C. intelligence apparatus so pernicious is the way it uses every means at its disposal against us all at once, blending cyber, human intelligence, corporate transactions and investments to achieve its strategic goals.”
But critics say some of the U.S. government’s counterintelligence efforts are racially biased and paranoid, amounting to a new Red Scare — a charge at least partly supported by the cases the Justice Department has had to drop and by its shutdown of the Trump-era China Initiative program.
China has undertaken its own expansive counterintelligence crusade, one that echoes Mao-era political campaigns. On July 1, China enacted a sweeping expansion of a counterespionage law. And in August, the Ministry of State Security announced that “all members of society” should help fight foreign spying, and offered rewards for anyone providing information.
The rival governments have also established new listening posts and secret intelligence-sharing agreements with other governments. American and Chinese agents have intensified their operations against each other in pivotal cities, from Brussels to Abu Dhabi to Singapore, with each side looking to influence foreign officials and recruit well-placed assets.
An image of Mr. Xi is seen on a giant screen in the middle of a display of Chinese military assets such as warships and planes at a military museum in Beijing.
Some U.S. officials think Mr. Xi’s authoritarian governance style gives intelligence agencies an opening to recruit disaffected Chinese citizens.Florence Lo/Reuters
For American spy agencies, Mr. Xi’s decisions and intentions are arguably the most valuable intelligence they seek, but he is also the most elusive of targets.
U.S. agencies are now probing exactly why China’s defense minister, Gen. Li Shangfu, appears to have been placed under investigation for corruption, and why Mr. Xi ousted Qin Gang, his foreign minister. American diplomacy and policy depend on knowing the motivations behind these moves.
A decade ago, the United States’ network of informants in China was eliminated by Chinese counterintelligence officials after the informants’ identities were uncovered. Since then, the C.I.A. has faced a major challenge to rebuild its network. That is partly because China’s expanding webs of electronic surveillance have made it difficult for American case officers to move freely in China to meet contacts.
China even has artificial intelligence software that can recognize faces and detect the gait of an American spy, meaning traditional disguises are not enough to avoid detection, according to a former intelligence official. American operatives now must spend days rather than hours taking routes to spot any tailing Chinese agents before meeting a source or exchanging messages, former intelligence officials say.
And Mr. Xi, like other authoritarian leaders, limits his use of phones or electronic communications, for the very purpose of making it difficult for foreign intelligence agencies to intercept his orders.
But officials in the vast bureaucracy under Mr. Xi do use electronic devices, giving U.S. agencies a chance to intercept information — what spies call signals intelligence — to give them some insight into the internal discussions of their Chinese counterparts.
In the balloon incident, the C.I.A. began tracking the balloon in mid-January, when the Chinese army launched it from Hainan Island, officials said.
U.S. officials also determined that commanders on the Central Military Commission that Mr. Xi chairs were unaware of this particular flight until it was tipping into crisis, and they vented their frustration at the generals overseeing the surveillance program.
Since that crisis, China has paused the operations of its fleet of balloons, but American officials said they believe Beijing will likely restart the program later.
William J. Burns, wearing a gray suit and red tie, standing in the Rose Garden of the White House.
William J. Burns, the C.I.A. director, has ordered an expansion of intelligence collection and analysis of China.Drew Angerer/Getty Images
Under William J. Burns, the C.I.A. director since 2021, the agency has hired more China experts, increased spending on China-related efforts and created a new mission center on China. And while American officials refuse to discuss details of the agency’s network of informants, Mr. Burns said publicly in July that it had made progress on rebuilding a “strong human intelligence capability.”
While it is unclear how robust the new network is, some U.S. officials think Mr. Xi’s extremely authoritarian governance style gives intelligence agencies an opening to recruit disaffected Chinese citizens, including from among the political and business elite who had benefited in previous decades from less party control and a less ideological leadership.
Some prominent Chinese figures, including “princelings” of Communist Party elite families, say in private conversations that they disagree with the turn China has taken.
China has also poured resources into determining the thinking of top American officials. A Justice Department indictment unsealed in July suggests Chinese businesspeople tied to the government were trying to recruit James Woolsey, a former C.I.A. director who was in the running to be a Trump administration national security cabinet official right after the 2016 election.