CTT Research Memo Finds Three Main Lessons on BIS Nominee Alan Estevez

Two weeks ago, President Joe Biden nominated Alan Estevez as the director of BIS. On that day, China Tech Threat hosted an online panel of four previous BIS directors’ views on Mr. Estevez’s pending challenges. (China Tech Threat’s coverage of the BIS nomination, opinions, news articles, and expert videos can all be found at chinatechthreat.com/future-of-bis/.) In order to better understand the nominee’s views on export controls, the Entity List, and other BIS tools, China Tech Threat has studied his career and compiled this research memo summarizing three main lessons. While there is limited material to examine,- after all, having spent 36 years as a Department of Defense civil servant, Mr. Estevez provides little public commentary, speeches, and writings upon which to… Read More

US and Allies Accuse China of Major Cyberattacks

Yesterday, the U.S., NATO and other allies are came together to call out China for malicious cyberattacks, including a March attack that exploited a flaw in Microsoft’s Exchange Server. It’s the first time that NATO has signed onto a formal condemnation of China’s cyber activities. They authorities are detailing more than 50 different techniques that Chinese state-sponsored actors used, and offering up recommended mitigations that businesses and organizations can take. The U.S. says that China’s Ministry of State Security is using contract hackers to conduct the attacks, many of which are being done for profit, including via ransomware. As part of Monday’s announcement, the Justice Department unveiled criminal charges against four Ministry of State Security hackers for a “multiyear campaign… Read More

The Hill and White House Get Tighter on the CPP’s Abuses

Rep. Michael McCaul (R-TX) and Sen. Bill Hagerty (R-TN) on Monday urged Commerce Secretary Gina Raimondo to add Chinese chipmaker Yangtze Memory Technologies Company (YMTC) to the department’s Entity List, citing ties to the Chinese military. The lawmakers wrote in the letter that urgency is needed to make sure memory chip supply does not become a “point of leverage” for China over the U.S. China’s “irrational state subsidies and non-financial support” to firms such as YMTC pose a threat to U.S. and its allies because memory chips have applications in defense, aerospace, artificial intelligence, they note. Both men sit on committees that have jurisdiction over export controls; McCaul is the ranking member of the House Foreign Affairs Committee and Hagerty is the… Read More

Statement: Estevez Nomination Signals Biden Administration’s Focus on China Threat

China Tech Threat Co-Founder Roslyn Layton issued the below statement on Alan Estevez, who President Biden named today to head the U.S. Commerce Department’s Bureau of Industry and Security (BIS). Read here for more on the elevated importance of BIS as the People’s Republic of China seeks to acquire strategic U.S. technology to advance its military. “We congratulate Mr. Estevez on his nomination at a time of expanded responsibility and oversight at BIS,” said Roslyn Layton. “Without the Bureau’s due diligence, the latest and greatest American-made, sensitive and strategic technologies could end up in the hands of the Chinese military and threaten our national security. During his confirmation hearing, we expect the members of the Senate Banking Committee to ask Mr.… Read More

President Biden Officially Nominates Alan Estevez to serve as BIS Under Secretary

Originally reported this morning in the Wall Street Journal and Reuters, this afternoon President Biden announced his intention to nominate Alan Estevez to serve as Under Secretary for Industry and Security at the Commerce Department. The White House press release called Mr. Estevez “a recognized leader in the defense and aerospace community, [that] joined Deloitte Consulting as a national security strategy and logistics executive in June 2017 after completing a 36 year career with the Department of Defense.” Earlier today, China Tech Threat provided an initial analysis of Mr. Estevez’s expectant nomination followed by a panel featuring four prior BIS directors. China Tech Threat will continue to cover Mr. Estevez’s nomination in the days and weeks to come.… Read More

Introducing High Tech Heist: New Vlog Series on Banking Cybersecurity

China Tech Threat is pleased to introduce High Tech Heist: Vlog Series on Banking Cybersecurity. In the first of the series, Dr. Roslyn Layton speaks with Tom Vartanian, a former federal banking regulator and author of 200 Years of American Financial Panics: Crashes, Recessions, Depressions and the Technology that Will Change It All. “Financial institutions are the number one target of hackers around the planet,” Mr. Vartanian explains. “And that’s not hard to understand because, as Willie Sutton said, that’s where the money is.” Financial organizations must realize that “the bank is the front door, the backdoor is an endless supply chain of vendors and people suppling everything that bank provides – online services, offline services, physical services,” he adds.… Read More

Chinese Universities Join the Push for Semiconductor Dominance

China’s mainland universities are ramping up programs to support the Chinese government’s ambitions to dominate the global semiconductor market, the South China Morning Post reported this week. “The increase in… academic programmes shows how China is doubling down on efforts to build up its semiconductor industry, which has been hampered by Beijing’s tech and trade war with Washington,” the article notes. The Made in China 2025 plan calls for eight percent of Chinese R&D expenditures to be directed to the semiconductor market, but a lack of skilled engineers “continues to be a drag on China’s attempts to catch up with the West.” The universities’ engagement demonstrates the Chinese Communist Party’s whole-of-nation approach to developing the country’s indigenous chip-making capabilities. Through… Read More

White House Report Part 2 of 2: Short-Term Profits Undermine Long-Term Resilience

A White House report last week offers a solemn assessment of American companies prioritizing profits over national security and long-term sustainability. “A focus on maximizing short-term capital returns has led to the private sector’s underinvestment in long-term resilience,” the 250-page report states. The United States has a competitive advantage over China in the production of semiconductor manufacturing equipment (SME), which provides a chokepoint that can limit “advanced semiconductor capabilities in countries of concern.” Yet, despite tighter export controls in recent years, sales to Chinese companies have been a major driver of American SME makers’ profits. Approximately 90 percent of Applied Materials’ and Lam Research’s revenues came from non-U.S. sales last year, the White House report notes. The percentage of Lam… Read More

White House Report Part 1 of 2: China’s “Massive Subsidy Campaign”

The White House released a report on Tuesday that details the findings and recommendations of the Administration’s 100-day supply chain review. Among the findings, the report warns of the Chinese government’s “massive subsidy campaign” to dominate emerging markets. President Biden signed an executive order in February that directed the review of four key industries: semiconductors, large capacity batteries, critical minerals and pharmaceuticals. The report states that the Chinese government’s “massive subsidy campaign [as much as $200 billion over the past eight years] to develop its domestic semiconductor capability” has exploited “gray areas” in international trade rules and avoided World Trade Organization (WTO) oversight. The Chinese Communist Party has made a concerted effort to dominate the semiconductor market. The Made in… Read More

Let the Chips Fall at BIS? Highlights Challenges, Opportunities for Biden Nominee

President Biden’s nominee to lead the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) will need to advance offensive and defensive measures to curtail China’s ambitions to dominate modern technology markets. That was among the participants’ recommendations during today’s virtual roundtable, “Let the Chips Fall at BIS?” The event, hosted by Dr. Roslyn Layton, featured Emily de La Bruyère, Senior Fellow at the Foundation for Defense of Democracies; Stephen Ezell, Vice President of Global Innovation Policy at the Information Technology & Innovation Foundation; and Will Hunt, Research Analysist at the Center for Security and Emerging Technology. The event coincided with the release of the White House’s 100-day supply chain review report. Among the findings, the report highlights the… Read More