Water Wars: Navy Sailors Paid Thousands to Pass Sensitive Information to China

The United States’ Summer in the Indo-Pacific

Two U.S. Navy Sailors Indicted for Passing Sensitive Military Information to China

Two U.S. Navy sailors stationed in California were arrested on Aug. 3 and charged with selling sensitive national security information to a Chinese intelligence officer. The Washington Post reported that the sensitive information included a blueprint for a radar system, information on defensive weapons, technical manuals for vessels, and operational plans for military exercises in the Pacific. Naval analysts told USNI News that the information targeted by the Chinese intelligence officer (including blueprints and information concerning upgrades to the Wasp Class Amphibious Assault Ship USS Essex (LHD 2), details on numerous shipboard systems, information on large-scale amphibious exercises in the Pacific, and the locations of air defense radars on Okinawa) indicates the Chinese military’s “sustained interest” in amphibious warfare as tensions around Taiwan remain high. 

Jinchao “Patrick” Wei, a machinist’s mate stationed aboard the USS Essex out of Naval Base San Diego, California, has been indicted by a grand jury in the Southern District of California on four counts, including conspiracy to communicate, deliver, and transmit information relating to the national defense of the U.S. to a foreign government in violation of 22 U.S.C. § 2778 (the Arms Export Control Act), violation of 18 U.S.C. § 794 (gathering or delivering defense information to aid foreign government), conspiracy to export technical data related to defense articles in violation of 22 U.S.C. § 2778 and Title 22, Code of Federal Regulations, and willful exportation of export-controlled technical data related to defense articles in violation of 22 U.S.C. § 2778 (the Arms Export Control Act) and Title 22, Code of Federal Regulations. Wei, 22, who was born in China, allegedly began the illicit conduct in February 2022 and collected between $10,000 and $15,000 from a Chinese intelligence officer.

Wenheng “Thomas” Zhao, a petty officer second class stationed at Naval Base Ventura County in Port Hueneme, California, has been indicted by a grand jury in the Central District of California on two counts, including conspiracy to collect and transmit sensitive U.S. military information in exchange for money in violation of 18 U.S.C. § 201(b)(2)(C) (bribery of public officials), and corruptly accepting and receiving payment in exchange for gathering and providing sensitive information, also in violation of 18 U.S.C. § 201(b)(2)(C). Zhao, 26, collected almost $15,000 in bribes from a Chinese intelligence officer.

At a press conference in San Diego, Department of Justice Assistant Attorney General for National Security Matthew Olsen stated that the defendants’ alleged crimes resulted in sensitive military information ending up in the hands of the People’s Republic of China (PRC). Olsen claimed that the charges “demonstrate [China’s] determination to obtain information that is critical to our national defense by any means so it can be used to their advantage.” According to the indictments, at the time of the alleged offenses, both indicted sailors maintained a secret level U.S. security clearance.

Both sailors pleaded not guilty in federal courts in San Diego and Los Angeles. If convicted, Wei and Zhao could face up to 20 years in federal prison.

U.S. and China Clash Over Freedom of Navigation in the South China Sea

On May 26, a Chinese J-16 fighter jet allegedly conducted an “unnecessarily aggressive” interception of a U.S. RC-135 Rivet joint reconnaissance aircraft in international airspace over the South China Sea. According to a statement by the U.S. Indo-Pacific Command (USINDOPACOM), “[t]he PRC pilot flew directly in front of the nose of the RC-135, forcing the U.S. aircraft to fly through its wake turbulence.” The turbulence of the intercepting aircraft allegedly disturbed the flight path of the U.S. aircraft, which appears visible on a video of the incident published along with USINDOPACOM’s statement. While USINDOPACOM asserted that the RC-135 was conducting safe and routine operations in international airspace at the time of the incident, the Chinese military accused the aircraft of “deliberately intrud[ing]” into China’s training area. China Foreign Ministry Spokesperson Mao Ning called on the U.S. to “stop such dangerous provocations” and asserted that “China will continue to take necessary measures to resolutely defend its sovereignty and security.”

On June 3, shortly after the incident between the J-16 and the RC-135, People’s Liberation Army Navy (PLAN) guided-missile destroyer CNS Suzhou (132) allegedly cut across the bow of the USS Chung-Hoon (DDG 93) as the latter and the Canadian warship HMCS Montreal (FFH 336) conducted a bilateral Taiwan Strait transit. According to the U.S. 7th Fleet, the bilateral transit was intended to “[demonstrate] the commitment of the United States and our allies and partners to a free and open Indo-Pacific.” The U.S. military released a video of the incident, which shows that the Chinese warship came within 150 yards of the Chung-Hoon in a maneuver that USINDOPACOM described as “unsafe” and a violation of the “rules of the road” for safe passage in international waters. The Chung-Hoon slowed to 10 knots to avoid collision. In response to the incident, China’s Defense Minister Li Shangfu accused the U.S. of provoking confrontation and called on the U.S. to “mind [its] own business” and refrain from sending military assets near China.

On June 20, the U.S. Coast Guard cutter USCGC Stratton (WMSL 752) also made Taiwan Strait transit. USINDOPACOM commented that the Stratton had transited through a corridor in the strait that is “beyond the territorial sea of any coastal State” and asserted that “[t]he United States military flies, sails and operates anywhere international law allows.” In response, PLAN Shandong Carrier Strike Group transited the Taiwan Strait the following day. The PLAN carrier did not cross the median line during the transit and remained on the western side of the strait. 

In a speech delivered in June at the International Institute for Strategic Studies’ 20th Shangri-La Dialogue in Singapore, Secretary of Defense Lloyd Austin asserted that, while the U.S. does not seek conflict or confrontation, it also “[does] not flinch in the face of bullying or coercion.” Austin stated that the U.S. would “work to ensure that no one country could exert control over the shared waterways” and will continue to work with allies and partners to uphold freedom of navigation and overflight. Chinese Defense Minister Li Shengfu declined Austin’s invitation to meet with him at the Shangri-La Dialogue, a decision that Austin called “unfortunate.” Chinese Lieutenant General Jing Jianfeng responded that responsibility for the breakdown in military dialogue “lies entirely on the U.S. side” due to the imposition of sanctions on Chinese officials and the U.S. military’s destabilizing presence in the Asia-Pacific.

Xinhua News Agency reported that during a July speech at the Association of Southeast Asian Nations foreign ministers’ meetings, Chinese Foreign Minister Wang Yi rejected “hegemony of navigation in the name of freedom of navigation.” Wang claimed that China “has always advocated the peaceful settlement of disputes through friendly consultations among countries directly concerned” and called upon countries outside the region to “play a positive role in maintaining regional stability instead of the opposite.”

Secretary of State Blinkin Visits China and Meets with Xi Jinping

Secretary of State Antony Blinkin met with Chinese President Xi Jinping on June 19 for a 35-minute discussion, culminating Blinkin’s “high-stakes” visit to Beijing. Prior to their meeting, Blinkin held discussions with several Chinese officials, which Xi described as “candid” and Blinkin called “constructive.” The talks focused on, among other topics, trade, human rights, climate change, macroeconomic stability, food security, and tensions over Taiwan. The State Department reportedly did not expect a “breakthrough” on any of the divisive issues discussed during Blinkin’s visit, and China did not agree to reopen military-to-military channels of communication. Blinkin noted that “[p]rogress is hard” but expressed his “hope and expectation” that the U.S. and China will have better communication and engagement moving forward. 

U.S. Navy Systems on Guam Hit by State-Sponsored Malware Attack

Microsoft, along with the Five Eyes intelligence sharing alliance (among the United States, Australia, the United Kingdom, New Zealand, and Canada), reported in late May that a Chinese state-sponsored hacking group called Volt Typhoon had carried out a cyber espionage campaign against U.S. military installations in Guam by installing malicious code designed to spy on and disrupt U.S. infrastructure. The malware’s targets included communications, utilities, manufacturing, and transportation systems. While Microsoft uncovered no evidence that the hacking group had used access to those systems for any offensive attacks, Microsoft stated that it has “moderate confidence” that the attack was designed “in preparation to upend communications in the event of a future crisis,” possibly centering on Taiwan. China denied the hacking allegations, dismissing Microsoft’s report as “extremely unprofessional” and part of a disinformation campaign that serves the U.S.’s political agenda. Chinese Foreign Ministry Spokesperson Mao Ning counter-accused the U.S. of hacking, calling the U.S. National Security Agency “the world’s biggest hacking group.” On May 24, China sent a warning to Chinese companies to be alert to American hacking efforts.

Military Developments in Taiwan 

U.S. Announces $345 Million Military Aid Package for Taiwan

On July 28, the U.S. announced $345 million in military assistance to help Taiwan counter China. This package, which would include defense equipment, as well as education and training for the Taiwanese military, is the Biden administration’s first major package that draws on the United States’ own stockpiles. According to two U.S. officials, the U.S.will send man-portable air defense systems, intelligence and surveillance capabilities, firearms, and missiles to Taiwan.

The military aid package “is in addition to the nearly $19 billion in military sales of F-16s and other major weapons systems that the United States has approved for Taiwan.” Most recently, the U.S. State Department approved the sale of $440 million in military equipment to Taiwan, which included 30 mm ammunition and related equipment, along with spare parts for Taiwan’s vehicles, small arms, combat weapon systems, and logistical support items. Delays in the delivery of these arms-sales due to supply chain issues and pressures created by Russia’s invasion of Ukraine, however, prompted the discussion around the military aid package. 

China immediately opposed the announcement. On Aug. 1, China stated that it had complained to the U.S. about its military aid package to Taiwan. Tan Kefei, a spokesperson for China’s defense ministry, stated that the U.S. “must stop all forms of ‘military collusion’ with Taiwan.” Furthermore, Liu Pengyu, a spokesman for the Chinese Embassy, issued a statement urging the U.S. to “stop selling arms to Taiwan” and to “stop creating new factors that could lead to tensions in the Taiwan Strait.” The U.S., however, has said that providing Taiwan with defense capabilities is important. Deputy Defense Secretary Kathleen Hicks, for example, stated that “getting stockpiles of weapons to Taiwan now, before an attack begins, is one of the lessons the U.S. has learned from Russia’s invasion of Ukraine.”

Taiwan Continues Diplomatic Visits to Europe, U.S.

In June, Taiwan’s Foreign Minister Joseph Wu held meetings in Europe to seek “support from European friends.” Wu visited Prague and met with Milos Vystrcil, the president of the Czech Senate, and Marketa Pekarova-Adamova, head of the lower house of Parliament, among others. Wu also traveled to Brussels to meet other European Union officials.

Though Taiwan has no formal diplomatic relations with any European country except the Vatican, it has maintained extensive informal ties with Central and Eastern European countries. Following Russia’s invasion of Ukraine and in the face of increased military aggression from China, EU leaders have expressed their support for Taiwan. In November 2022, for example, members of the European Parliament supported a resolution that condemned China’s aggression in the Taiwan Strait. And in a May interview with Al Jazeera, Remus Li-Kuo Chen, head of the Taipei Representative Office in the EU and Belgium, commented on the positive upswing in Taiwan-EU relations and drew comparisons between Ukraine and Taiwan.

In mid-August, William Lai, Taiwan’s vice president and Democratic Progressive Party presidential frontrunner visited the U.S. through stopovers on his way to and from Paraguay for the Aug. 15 inauguration of Paraguay’s new president. Lai transited through New York on his way to Paraguay and stopped in San Francisco on his way back to the democratic, self-governing island. While in the U.S., Lai gave speeches to the Taiwanese community and met with officials from the American Institute in Taiwan, a government nonprofit that handles U.S.-Taiwan relations. Taiwan’s presidential and parliamentary elections will be held in January 2024, and Taiwan’s government has stated that China will attempt to interfere in those elections through illicit funding of pro-Beijing candidates.

China has protested both of Taiwan’s diplomatic visits. Ahead of Wu’s visit to the Czech Republic, Chinese Foreign Ministry spokesperson Wang Wenbin stated that China urges “the European side to understand the essence of the Taiwan issue … and not to conduct official exchanges with Taiwan under any name.” With respect to Lai’s trip to the U.S., Xie Feng, Chinese ambassador to the U.S., stated that “the priority for [China] is to stop Lai Ching-te from visiting the U.S., which is like a gray rhino charging at us.” A “gray rhino” event refers to a “highly obvious yet ignored threat.” China also carried out air and sea military exercises around Taiwan to “send a stern warning” to Taiwan following Lai’s U.S. visit. Although Taiwan’s President Tsai Ing-wen and her administration have repeatedly proposed discussions with China, her requests have been rejected by Beijing.

Other Military Developments

Military activity has continued in and around Taiwan this summer, which includes Chinese, American, and Taiwanese military presence.

• In early May, Taiwan reported that it had detected People’s Liberation Army (PLA) drones circling the island. It was the second time in a week that China used long-range reconnaissance drones to deploy “encirclement” maneuvers above Taiwan. Military analysts have stated that such drones, especially those capable of carrying heavy weapons, could play a critical role in surveillance, blockades, strikes, and assassinations.
• On June 8, Taiwan reported that 37 Chinese military aircraft flew into the island’s air defense zone, some of which then flew into the western Pacific.
• On June 11, Taiwan again reported that it had detected 24 Chinese air force planes, including J-10, J-11, J-16, Su-30 fighters, and H-6 bombers. It also reported that four Chinese naval ships were executing combat patrols.
• On June 24, Taiwan’s defense ministry stated that it had detected 19 Chinese warplanes, including J-10 and J-16 fighters, and that eight of them had crossed the Taiwan Strait’s median line and had approached close to the island’s contiguous zone.
• On July 3, Taiwan’s military held live fire drills at Pingtung, on Taiwan’s southern coast. The drills included “firing missiles from highly mobile armoured cars to destroy targets close to shore in a simulation of repelling invading forces.”
• On July 4, Chinese fighter jets crossed the median line of the Taiwan Strait again.
• On July 12, Taiwan’s Ministry of National Defense reported a total of 30 Chinese aircraft operating near Taiwan, including unmanned aerial vehicles, Chengdu J-10 multi-mission aircraft, Shenyang J-16 fighters, and Xian H-6 bombers. Taiwan also reported that four PLAN vessels were operating near the island.
• On July 13, China protested a U.S. Navy P-8A flight through the Taiwan Strait, stating that the U.S. “hyped [the aircraft transit] publicly.” The U.S. responded, saying that the U.S. Navy P-8A Poseidon transited the Taiwan Strait “in accordance with international law.”
  

AUKUS Progresses on Nuclear Submarine Capabilities 

After 18 months of analysis and discussion with the U.K. and Australia, the U.S. signaled progress on the goal of developing Australia’s first nuclear-powered submarine force. As reported in previous Water Wars columns, the U.S., the U.K., and Australia formed a security agreement known as AUKUS in September 2021 as a response to “growing perceptions of a rising Chinese threat.” One of AUKUS’s key goals was to help Australia develop at least eight nuclear-propelled submarines. On July 13, the U.S. Senate Foreign Relations Committee proposed legislation outlining how the U.S. would help Australia develop nuclear submarine capabilities.

The amendment to the State Department Authorization Act of 2023 “authorizes the transfer of two Virginia class submarines from U.S. stocks to Australia, while authorizing a third submarine for sale to Australia via the Foreign Military Sales (FMS) process.” The amendment also creates an expedited process for AUKUS-related technology clearances and creates commercial export controls exemptions for the material related to the program. Commenting on the amendment, U.S. Sen. Tim Kaine (D-Va.) said: “I’m working to make sure the AUKUS defense agreement strengthens our partnerships with Australia and the United Kingdom, especially in light of Chinese aggression in the South China Sea[.] ... This legislation is key to paving the way for that vision.”

Given high bipartisan enthusiasm around deepening the AUKUS partnership, criticism has been fairly muted. On July 26, however, a group of 22 Republican senators and three Republican House members led by Sen. Roger Wicker (R.-Miss.) and Sen. Susan Collins (R-Maine) urged the Biden administration to propose a multi-year plan to expand industrial spending on submarines, expressing concerns that the current proposal would “unacceptably weaken the U.S. fleet even as China seeks to expand its military power and influence.” In the letter, the lawmakers request that “appropriations and authorities alongside a multi-year plan to increase U.S. submarine production to a minimum of 2.5 Virginia-class attack submarines per year.”

Despite such concerns, senior leaders in AUKUS remain optimistic. Such optimism was further reinforced through the Talisman Sabre 23 military exercise held in Australia in late July. The large-scale military exercise, which included nearly 30,000 troops from the U.S. and its allies, aimed to express “an unmistakable message of resolve toward maintaining a free and open Indo-Pacific.”

The Philippines Navigates Relationships with China and the U.S.

China’s Xi Meets with Former President Duterte as Marcos Jr. Visits Oval Office

On July 17, former Philippine President Rodrigo Duterte engaged in a “surprise” meeting with Chinese President Xi Jinping, during which Xi urged Duterte to help foster “friendly cooperation” between China and the Philippines. Xi’s outreach to a former Philippine leader “known for his pro-China approach” comes at a time when current President Ferdinand Marcos Jr. has pursued closer ties with the U.S., most notably by granting the U.S. military access to four additional locations within the Philippines earlier this year as part of the Enhanced Defense Cooperation Agreement between the two countries. Marcos stated that he was aware of Duterte’s meeting with Xi and expressed hope that the discussion would help achieve progress. 

The Duterte-Xi meeting followed closely on the heels of Marcos’s visit to Washington, D.C., on May 1 to meet with President Biden as part of an effort to strengthen security and economic relations between the U.S. and the Philippines. During that meeting, Biden assured Marcos that the U.S. commitment to the defense of the Philippines remains “ironclad.” 

Buoy Competition in the Disputed Spratly Islands 

On May 14, the Philippines placed navigational buoys within its exclusive economic zone in order to reinforce its claim of sovereignty over the Spratly Islands (China: Nansha Qundao; Philippines: Kalayaan Islands; Vietnam: Quần đảo Trường Sa). China has routinely deployed Coast Guard and fishing vessels to the disputed territory. Commodore Jay Tarriela, a Philippine Coast Guard spokesperson, claimed that the placement of buoys was intended to “[highlight] the Philippines’ unwavering resolve to protect its maritime borders and resources and contribute to the safety of maritime trade.” Less than two weeks after the Philippines’ buoy placement, China deployed three of its own buoys in the vicinity of the Spratly Islands, which China claimed would “ensure the safety of ships’ navigation and operations.” The buoy-placing competition between China and the Philippines is regarded as a sign of heightened tensions over the contested region.

International Backlash After Chinese Coast Guard Fires Water Cannons at Philippine Vessel

On Aug. 5, a Philippine ship conducting a resupply mission to the garrison aboard a Philippine transport ship grounded on Second Thomas Shoal (Philippines: Ayungin Shoal; China: Ren’ai Jiao; Taiwan: Ren’ai Ansha; Vietnam: Bãi Cỏ Mây) was interdicted by six Chinese Coast Guard vessels and two militia vessels, one of which fired water cannons at the Philippine vessel. The Philippine Coast Guard released a video of the incident. In 1999, the Philippines intentionally grounded the BRP Sierra Madre on the Second Thomas Shoal and manned the grounded vessel with a garrison of Marines in order to assert its maritime claim to the region, which China disputes. China’s Coast Guard, in response to the incident, accused the Philippines of trying to “permanently occupy” Chinese territory. The Philippines summoned the Chinese ambassador to deliver a diplomatic protest following the incident.

The Philippines’ maritime claim to the Second Thomas Shoal is supported by the 2016 South China Sea Arbitration, in which an arbitral tribunal determined that the Second Thomas Shoal was part of the exclusive economic zone and continental shelf of the Philippines. China refuses to accept or recognize the arbitral ruling, claiming that it violates the United Nations Convention on the Law of the Sea (UNCLOS) and is thus “illegal, null and void.”  

The water cannon incident prompted international backlash, with France and Japan voicing concern over China’s actions and expressing support for the 2016 arbitral ruling in favor of the Philippines. A U.S. State Department press release similarly expressed support for the Philippines, calling China’s “dangerous actions” to obstruct the resupply mission “inconsistent with international law” and “the latest in repeated threats to the status quo in the South China Sea, directly threatening regional peace and stability.” The State Department asserted that the 2016 international arbitration is “final and legally binding on the PRC and the Philippines” and called upon China to abide by the ruling. The U.S.’s statement also emphasized that any armed attack on Philippine vessels, aircraft, and armed forces would invoke U.S. mutual defense commitments under Article IV of the 1951 U.S.-Philippines Mutual Defense Treaty.

China defended its “professional, restrained, and justifiable” actions and demanded that the Philippines remove the “illegally” grounded ship from the Second Thomas Shoal.

Engagement With Pacific Island Nations

Solomon Islands Newspaper Allegedly Accepts Funds in Exchange for Positive Coverage

 A Solomon Islands news company sparked controversy by allegedly accepting Chinese funding in exchange for positive coverage of China. The Solomon Star was reportedly given more than $130,000 by the Chinese government in exchange for a pledge to “promote the truth about China’s generosity and its true intentions to help develop” the Solomon Islands. In an editorial published on Aug. 1, the Solomon Star admitted that it received funding from China, claiming that the newspaper “had nothing to hide.” The newspaper further denied that the Chinese funding had any impact on its editorial independence.

Pacific Island Nations Consult with Australia About Forming Militaries

The Solomon Islands and Vanuatu are reportedly considering forming military forces. The two Pacific Island nations have discussed the matter with Australia, according to Defense Minister Richard Marles. Marles stated that his country “would not ‘express a view’ either way” as to whether they should do so but affirmed that “Australia is very keen to play its part in partnering with the Solomon Islands in the development of their defence force” if they do move forward with the plans. He asserted that Australia seeks to “be the natural partner of choice” for all countries in the Pacific seeking to expand military capabilities.

Only three Pacific Island nations (Tonga, Papua New Guinea, and Fiji) currently have militaries. Earlier this year, the U.S. entered into a defense cooperation agreement with Papua New Guinea, reportedly in response to the security pact that the Solomon Islands signed with China in 2022. 

U.S. Opens a New Embassy in Tonga

On May 9, the U.S. officially opened a new embassy in Nuku’alofa, Tonga. Last July, following the finalization of China’s security pact with the Solomon Islands in April, Vice President Kamala Harris announced new commitments to deepen U.S. engagement with the Pacific Islands. The opening of the new U.S. embassy in Tonga fulfills part of Harris’s pledge.

Analysis

Alan C. Tidwell, Meg Keen, Anna Powles, Jose Sousa-Santos, and Anouk Ride argued that the Solomon Islands’ attempt to develop military capabilities may be misguided in solving its security challenges. Though geopolitical rivalries have recently been leveraged to assist the Solomon Islands in building a military force, the authors outline a number of reasons why military investments may be unproductive. Most notably, the most pressing security concerns faced by the Solomon Islands include those related to climate change and the environment, which the authors argue are better addressed through “targeted government spending and development assistance.” The authors suggest that the U.S. and other countries build the capacity of existing local and regional institutions to assist the Solomon Islands as a better strategy.

Cymie R. Payne at the American Society of International Law summarized the new High Seas Biodiversity Treaty, which was adopted on June 19 as the third implementing agreement to the UNCLOS. As Payne notes, the treaty aims to “protect and preserve the marine environment in areas beyond national jurisdiction,” “to ensure adequate assessment and monitoring of potentially harmful activities,” and “to support the development and use of marine scientific research,” among other goals.

Several authors argued on War on the Rocks that a comprehensive U.S. foreign policy in the Indo-Pacific must expand beyond a focus on China. Instead, the authors noted that nontraditional maritime security threats, particularly illegal fishing and piracy, remain critical barriers to a “free, safe, and prosperous maritime domain” in the Indo-Pacific. As a solution, the authors suggest that the U.S. lead multilateral efforts to establish clear and enforceable rules to provide guidance around illegal fishing and other maritime crimes.