Chinese `stole all nuclear secrets'

Espionage: Devastating report reveals that for 20 years Peking agents stripped America of weapons technology

THE POLITICAL storm brewing over Washington since the first disclosures of Chinese spying six months ago broke yesterday with release of the Cox report, a 700-page catalogue of deceit and theft that said Peking's nuclear- weapons expertise is "on a par" with that of the US. Peking could begin testing the first of its advanced nuclear weapons as early as this year, with deployment by 2002.

The report said China engaged in systematic espionage over 20 years, culling top-secret information on all seven nuclear warheads in the US ballistic-missile arsenal and the neutron bomb, not yet deployed. Stolen secrets included the blueprint for the W-88 miniaturised warhead, which allows a missile to be armed with multiple warheads.

The report also said at least some of the 3,000 Chinese corporations operating in the US, some connected to the Chinese army, were a front for unauthorised technology exports. US companies may not be aware of the extent of Chinese spying and many "are generally unprepared for the reality of doing business in the People's Republic of China". China's "appetite for information and technology appears to be insatiable", the report concluded. The leader of the Republican majority in the Senate, Trent Lott, led critics of the Clinton administration in saying the thefts were the most damaging foreign espionage effort since the Second World War, if not in US history.

The report acknowledged that, while "central" to China's acquisition of US nuclear secrets, spying was not the only method used. Information "is obtained through espionage, rigorous review of US unclassified technical and academic publications and extensive interaction with US scientists and the Department of Energy Laboratories". The report also blamed "a major counter- intelligence failure at the national laboratories" and lax security at Chinese launch sites for US satellites.

The Energy Secretary, Bill Richardson, whose department oversees the national laboratories, said he had taken "enormously aggressive action to deal with the problem" and many of the findings were outdated. "I can assure the American people that their secrets are now safe at the labs."

He accused opponents of the administration of "over-sensationalism".

"Not every allegation is a proven fact," he said. "There is no evidence of a wholesale loss of information."

Some of the report's strongest criticism was of two commercial US satellite companies, Loral and Hughes, accused not only of poor security on the ground but also of systematically breaching export regulations.

Among the report's 38 recommendations was to place controls on such defence- sensitive ventures in China.

The special congressional committee was set up a year ago under the Republican representative from California, Christopher Cox, to investigate US-China relations after allegations that China tried to buy influence during the last presidential election campaign. In the event, its findings on funding were inconclusive, and its focus switched to spying.

While the cumulative effect of the findings amounted to an indictment of Chinese deception, experts differed on how much national security had suffered. The most pessimistic view was that US nuclear security had been hopelessly compromised. A more sanguine view from Democrats and part of the scientific establishment was that China's record of using foreign technology was not good and that US nuclear weapons superiority remained - as Mr Richardson put it - "overwhelming".

President Bill Clinton said the administration accepted most of the report and was already implementing its recommendations. But his policy of "constructive engagement" - which Republicans see as the root of the problem - should continue, as it had produced benefits for US national security, including China's decision to sign the Test-Ban Treaty.

The political shock in Washington was dulled by the fact that the most heinous claims were already in the public domain, having been leaked to the US media in the four months between its completion and release for publication.

In Peking, the government condemned Washington's accusations as "groundless" and coming from those who "harbour deep prejudice and hostility" towards China. The report was fuelled by "ulterior motives", said China's foreign ministry spokesman. These included America's need to divert attention from the 7 May Nato bombing of the Chinese embassy in Belgrade, he said.

However, the question remains whether China can afford a sharply deteriorating relationship with the US. Foreign investment on the mainland is falling, exports are down, and Peking desperately needs US technology and investment.

What Cox Says Excerpts from the US Congressional report on Chinese espionage aimed at US nuclear secrets and satellite technology:

"The People's Republic of China has stolen design information on the United States' most advanced thermonuclear weapons ... The Select Committee judges that China's next generation of weapons will exploit elements of stolen information ... Chinese penetration of our labs spans at least the past several decades and almost certainly continues today."

"These thefts of nuclear secrets enabled China to design, develop and successfully test modern strategic nuclear weapons sooner than would otherwise have been possible, [giving China] information on a par with our own."

"The stolen information includes classified information on ... every currently deployed warhead in the US ballistic missile arsenal ... It also includes classified design information for an enhanced radiation weapon [the `neutron bomb'], which neither the US, nor any other nation, has yet deployed."

"The Select Committee has found that the primary focus of this long- term, ongoing intelligence collection effort has been on the following nationalweapons laboratories: Los Alamos; Lawrence Livermore; Oak Ridge; Sandia."

"With the stolen US technology, China has leapt, in a handful of years, from Fifties-era strategic nuclear capabilities to the more modern thermonuclear weapons designs. These modern thermonuclear weapons took the United States decades of effort, hundreds of millions of dollars and numerous nuclear tests to achieve."