US, Allies Should Better Screen Chinese Investment in Remote Sensing Tech, Report Says
The U.S. and its allies should increase their scrutiny of China's foreign investment in commercial remote sensing firms to ensure the Chinese military does not benefit from such transactions, the congressionally mandated U.S.-China Economic and Security Review Commission said in a new report Dec. 16.
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The Committee on Foreign Investment in the U.S. should receive additional powers from Congress to review transactions involving remote sensing technology, the report says. The commission also calls on the U.S. to set up a “framework” with its European and Pacific allies to protect remote sensing technology from "surreptitious acquisition by China."
“As imperfect as CFIUS regulations are, they are stronger than the export control and investment approaches of many close U.S. allies, potentially offering Chinese investment and technology firms a way to acquire advanced remote sensing technology without having to deal with CFIUS,” the report says.
Using “both licit and illicit methods,” Chinese commercial entities and state-owned funds have invested at least $3.7 billion in U.S. remote sensing firms to gain access to technology and expertise that could advance its military capabilities, the commission said. China’s remote sensing investments have mostly been in lidar, though it has also participated in deals to acquire space-based remote-sensing companies.
As an example of the potential dangers of such investments, the commission cited Chinese auto manufacturer Baidu’s $75 million investment in Velodyne, a Silicon Valley-based lidar company. “Although Baidu has concentrated its autonomous vehicle research on commercial robo-taxis, the company has also been forced to confront allegations that its [artificial intelligence] technology has been used by the [People’s Liberation Army], raising the question of whether technology such as lidar might also be utilized by the Chinese military to develop autonomous vehicles that could be used in a range of support and combat missions,” the report says.