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<\/p>\nIt\u2019s a clich\u00e9 to call China\u2019s rapid economic growth a \u201cmiracle\u201d. You\u2019ve heard all about the 800 million people \u201clifted out of poverty\u201d and the fishing villages turned into mega-cities. Across the developing world, Beijing markets its economic model \u2014 dubbed \u201cthe Beijing Consensus\u201d \u2014 to envious governments hoping for a bit of that Chinese magic.<\/p>\n
But was it so miraculous after all? In The Great Heist, the veteran CIA officers David R Shedd and Andrew Badger argue that the real reason for China\u2019s success is foul play. \u201cThe purported miracle of China\u2019s economic growth wasn\u2019t due to enlightened [Chinese Communist Party] state policy planners. Rather it was the fruit of cold hard theft on a scale never seen before in the global economy.\u201d<\/p>\n
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The Great Heist is a lengthy rap sheet of all the cases where Chinese state and corporate actors have stolen intellectual property from American companies. Shedd and Badger paint a picture of an all-powerful ministry of state security (MSS) that enlists the help of all and sundry to steal American research to help the motherland and its businesses. The examples of wrongdoing span the fields of electric cars, semiconductors, telecoms, AI, weaponry, chemicals, industrial agriculture, on and on.<\/p>\n
The experience of General Electric Aviation seems typical: an ethnically Chinese employee downloading proprietary information and handing it directly to an MSS handler. At other times the transfering of critical knowledge is done in the open \u2014 such as when the turbine company HT Blade, a joint venture with a Texan co-founder, was effectively taken over by state-owned Chinese companies.<\/p>\n
\u2022 Why China is winning the new espionage Cold War<\/a><\/p>\n But the authors go beyond illustrating the extent of Chinese industrial espionage. They overstretch their thesis, arguing that egregious intellectual property (IP) theft is the \u201csingle most critical contribution to China\u2019s rapid economic ascent and military buildup\u201d. This requires them to overlook the other, more important reasons behind China\u2019s remarkable rise.<\/p>\n Let\u2019s recap. In 1976, the year that Mao Zedong died, China\u2019s GDP was less than a tenth of America\u2019s, its exports accounting for about 1 per cent of global trade. Mao\u2019s death allowed a band of Chinese leaders, led by Deng Xiaoping, to begin economic reforms. Gone were the mass political movements, the state-allocated housing, the communally farmed fields. In their place came private enterprise, foreign investors and, from the grassroots to the elites, an almost rabid devotion to making money. Fifty years later, China is unrecognisable. It is the world\u2019s second-largest economy and the largest exporter of goods. <\/p>\n Espionage certainly doesn\u2019t explain the early years of China\u2019s economic success story. The first decades were based on cheap, labour-intensive but tech-light manufacturing. In that, the country was following the bog-standard, well-trodden routes to development taken by Japan, South Korea and Taiwan. This was the sort of industry that didn\u2019t require industrial espionage. For many of the following years, it was investment in property or in building bridges and roads that caused the bulk of Chinese growth. China has also invested much more of its GDP back into its economy than other developing countries. This is a much less sexy story, but one that is well documented by the International Monetary Fund and the World Bank. <\/p>\n Only recently have high-tech industries become central to Beijing\u2019s national power, and even now it\u2019s not clear that their success is enough to reinvigorate Chinese growth, which has slowed this decade as a result of the meltdown in property and construction. <\/p>\n \u2022 Chinese hackers infiltrated critical British infrastructure<\/a><\/p>\n No doubt IP theft has served as an accelerant for some companies, potentially saving years of research and development for such companies as Huawei, which has been accused of reverse engineering and copying contractors\u2019 production lines and codes.<\/p>\n But the authors fail to trace how that specifically translates into market dominance, compared with the many other factors that companies face. Even armed with cutting-edge IP, to convert that into commercial success still requires local supply chains, cheap and accessible labour, friendly regulations and generous subsidies. China produces almost half<\/a> of all the world\u2019s top AI talent. Its leading companies aren\u2019t just succeeding by copying what has been done before, but are genuinely pushing forward the technological frontier.<\/p>\n The authors\u2019 case may be stronger on the military side, where a stolen design can translate more directly into capability. But is China\u2019s military prowess really solely explained by a succession of thefts rather than decades of sustained spending, Russian arms purchases, and the building of a physical industrial base?<\/p>\n