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The PLA Gets Two Huge Industrial Parks For Its R&D

November 4, 2017

Via Wikimedia Commons.

This week marked a crucial turning point for China’s military-industrial complex. On November 2, a Thursday, a barely publicized ceremony in Shaanxi Province was held to launch two important projects. The significance of the event merited a cursory press release whose mileage didn’t extend beyond the usual state-owned media.

Two new industrial parks are now open for attracting private sector firms to embark on military-related ventures. Both are located outside the historic city of Xi’an. The Xi’an Electronics Valley and the Western China Civil-Military Integration Valley are reported to offer a “1.45 million square meter area” for manufacturing and research enterprises.

What exactly the PLA needs from China’s private sector isn’t specified. The enviable state of domestic military procurement led by enormous regional conglomerates and their subsidiaries are responsible for bringing the PLA to the 21st century. Its achievements are staggering. But for years now plans have been afoot to absorb the best practices from the private sector so technological innovation can be hastened; a holy grail in the Xi Jinping era.

The short-term for these parks is:

…the project’s first priority is to set up a system featuring military-civilian integration and Information Technology (IT) industries, which promote innovation in electronic information and the transformation of scientific and technological achievements in an area of 100,000 square meters.

Allowing the private sector to have a role in PLA modernization began three years ago with the launch of a procurement website. The process gained serious momentum the following year as the military’s technological benchmarks rose higher. One clever method for boosting R&D was allowing state-owned enterprises to join the Shanghai Stock Exchange and raise capital from foreign sources. A genuine private-public policy didn’t materialize until 2017 with the creation of the mysterious Military-Civil Fusion Development Commission.

But the opaque nature of Chinese corporate structures really muddles the divide between a private firm and a state-owned entity. Hasn’t the PLA always turned to the private sector, via shell companies, fronts, shady purchases, and joint ventures, for building up its arsenal? True.

The new Civil-Military/Military-Civil craze might be aspiring for a different goal. It does appear that by opening up an industrial park, with cooperation from the local administration and a engineering university, China’s military can extricate themselves from gray activities and enjoy unfettered R&D that’s no longer dependent on foreign know-how.

What exactly is going to be made in Xi’an? With the PLA’s impressive supply chain capable of rolling out any weapon system in record time, the output from these civil-military valleys could be more strategic in nature. Meaning what matters are promising new applications taken from STEM fields, like artificial intelligence and biotechnology, rather than more tanks and UAVs.

Ever since the PLA celebrated its 90th birthday there’s been a steady repetition of a few crucial tenets. These are winning wars, mechanization, and information technology.

But education counts a lot too:

By taking advantage of the achievements in the industries and scientific research, the pair will meet the demands for personnel and technological innovation and also open a wide land for their exploration in producing, teaching and researching.

In the 1.45-million-square-meter planning area, the valley will also work to nurture talents, attract entrepreneurial companies and provide supporting services in order to usher in a new technology development era.

It’s tempting to call this China’s version of a “Silicon Valley for weapons” but the outcome could be more nuanced. The entire efforts points to a melding of research, engineering, and manufacturing so that Beijing can finally overcome its technological shortcomings. Just as Xi and his generals want.


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