WASHINGTON: The United States worries that China will use its power in global supply chains as an additional weapon to advance its political and military might, a report released Wednesday showed.
The “Annual Threat Assessment” issued by the Director of National Intelligence said China is already using its supply chain dominance to force foreign companies and countries to transfer technologies and intellectual property to it.
China hit back against the assessment on Thursday, terming the report “slander” and saying it “confuses black with white.”
The US intelligence community sees Beijing using its economic power in parallel with military strength to secure regional and global influence.
“The government of China is capable of leveraging its dominant positions in key global supply chains in an attempt to accomplish its goals, although probably not without significant cost to itself,” the report said.
That could be a particular danger if China is able to take over Taiwan, another leading contributor to industrial and technology components, it said.
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China seizing Taiwan “probably would have wide-ranging effects, including disruption to global supply chains for semiconductor chips because Taiwan dominates production of cutting-edge chips,” it said.
The pandemic demonstrated how the disruption of a single factory in China or elsewhere could halt the work of major industrial operations around the globe.
The “Annual Threat” report singled out China’s dominance in technology sectors including semiconductors, critical minerals, batteries, solar panels, and pharmaceuticals.
“China’s dominance in these markets could pose a significant risk to US and Western manufacturing and consumer sectors if the Government of China was able to adeptly leverage its dominance for political or economic gain,” it said.
The Threat report also singled out other distinct military challenges from China.
It said the People’s Liberation Army Rocket Force’s conventional missile capabilities “probably” now pose a serious threat to US forces and bases in East Asia.
