Civil-military integration (CMI) is the process of combining the defense and civilian industrial bases so that common technologies, manufacturing processes and equipment, personnel, and facilities can be used to meet both defense and commercial needs. CMI includes:
Cooperation between government and commercial facilities in research and development (R&D), manufacturing, and/or maintenance operations; combined production of similar military and commercial items, including components and subsystems, side by side on a single production line or within a single firm or facility, and use of commercial off-the-shelf items directly within military systems. 
China is keenly aware of the potential benefits of CMI in reducing the costs and risks of weapons development and production, and in accelerating the process of military modernization. In particular, Beijing sees CMI as advancing its long-term goals of becoming self-sufficient in arms procurement, thereby permitting the PLA to reduce its dependencies upon foreign suppliers for its most advanced weapons. For China, therefore, CMI is basically a new wrinkle on the classic techno-nationalist development strategy of a joint government-industry-military effort to acquire, nurture, indigenize, and diffuse critical dual-use technologies deemed essential to national security and defense.
Early Chinese attempts at CMI (in the 1980s and early 1990s) were basically an effort to convert military factories over to civilian production. With Beijing’s enthusiastic blessing, the defense industry branched out into a broad array of civilian manufacturing. China’s aviation industry, for example, established a number of commercial joint ventures with Western aircraft companies to produce subassemblies and parts, while shipyards shifted much of their production to constructing cargo ships. Even the missile industry got into the act, entering the lucrative satellite-launching business with its series of Long March space-launch vehicles. Many of these efforts were only modestly successful, however, and they did little to transfer innovative commercial technologies to military uses.
China’s approach to CMI began to change around the mid-1990s, and it entailed a crucial shift to an active strategy of dual-use technology development and commercial-to-military spin-on, particularly in the areas of microelectronics, space systems, new materials, propulsion, missiles, computer-aided manufacturing, and information technologies (IT). This new strategy was embodied in the defense industry’s five-year plan for 2001-2005, which emphasized the dual importance of both the transfer of military technologies to commercial use and the transfer of commercial technologies to military use. This called for the Chinese arms industry not only to develop dual-use technologies, but to actively promote joint civil-military technology cooperation. 
These efforts at exploiting dual-use technologies have paid dividends in at least a few defense sectors. China’s military shipbuilding, for example, appears to have particularly benefited from CMI efforts over the past decade. Following an initial period of basically low-end commercial shipbuilding – such as bulk carriers and container ships – China’s shipyards have, since the mid-1990s, progressed toward more sophisticated ship design and construction work. In particular, moving into commercial shipbuilding began to bear considerable fruit beginning in the late 1990s, as Chinese shipyards modernized and expanded operations, building huge new dry-docks, acquiring heavy-lift cranes and computerized cutting and welding tools, and more than doubling their shipbuilding capacity. At the same time, Chinese shipbuilders entered into a number of technical cooperation agreements and joint ventures with shipbuilding firms in Japan, South Korea, Germany, and other countries, which gave them access to advanced ship designs and manufacturing technologies – in particular, computer-assisted design and manufacturing, modular construction techniques, advanced ship propulsion systems, and numerically controlled processing and testing equipment. 
As a result, military shipbuilding programs collocated at Chinese shipyards have been able to leverage these considerable infrastructure and software improvements when it comes to design, development, and construction. This in turn has permitted a significant expansion in naval ship construction since the turn of the century, and since 2000, China has launched at least six new diesel-powered submarines, three destroyers, and four frigates, with eight more warships under construction; this is nearly double the rate of naval ship construction during the 1990s. Moreover, the quality and capabilities of Chinese warships have also apparently improved. In 2001, for example, China began work on the first in a new class of domestically developed, 9,000-ton guided-missile destroyer, the Type 052B, equipped with a long-range air-defense missile system and incorporating low-observable features into its design. A further refinement on this class, outfitted with a rudimentary Aegis-type phased-array radar, is the Type-052C, first launched in 2003. China is also currently producing the Song-class diesel-electric submarine, the first Chinese submarine to have a skewed propeller for improved quieting and capable of carrying an encapsulated anti-ship cruise missile that can be launched underwater.
Even more important, China’s People’s Liberation Army (PLA) has clearly benefited from piggybacking on the development and growth of the country’s commercial IT industry. The PLA is working hard to expand and improve its capacities for command, control and communications, information-processing, and information warfare, and it has been able to enlist many local IT firms in support of its efforts. These include Huawei Technologies (which manufactures switches and routers for communications networks), Zhongxing Telecom (ZTE, mobile and fiber-optic networks), Julong (switchboards), and Legend and Beijing Founder (computers). Many of these companies have close ties to China’s military-industrial complex, and some, such as Huawei, Julong, and Legend, were founded by former PLA officers. Consequently, the PLA has developed its own separate military communications network, utilizing fiber-optic cable, cellular and wireless systems, microwave relays, and long-range high frequency radios, as well as computer local area networks. 
Two other defense sectors are worth noting when it comes to achieving some success in civil-military integration. First, China’s satellite business has entailed the considerable development and application of dual-use civilian technologies. Chinese telecommunications satellites are basically commercial in nature, as is China’s rudimentary Beidou navigation satellite system, but both serve military purposes as well. In particular, recent Chinese successes in launching earth observation satellites – such as the Ziyuan-1 and Ziyuan-2 – have critical military applications in providing near-real time – and increasingly high-resolution – imagery intelligence. In addition, many of the technologies being developed for commercial reconnaissance satellites, such as charge-coupled device cameras, multi-spectral scanners, and synthetic aperture radar imagers, have obvious spin-on potential for military systems.
Secondly, China’s small but growing helicopter industry has always been dual-use in execution, such as the licensed-production of the French AS-365 Dauphin 2 (used by the PLA Navy for antisubmarine warfare, for example), and the more recent development of the indigenous Z-10 utility helicopter, which includes an armed attack version.
Despite these achievements, Chinese civil-military integration efforts -particularly when it comes to commercial-to-military spin-on – have remained limited. There is little evidence so far of any significant civil-military integration in other sectors of the Chinese defense industry, particularly the aviation industry where one might expect CMI to be a naturally occurring phenomenon. Commercial and military aircraft manufacturing in China is still carried out not only (and perhaps unavoidably) on separate production lines, but also in separate facilities and often in separate enterprises, with little apparent communication and crossover between these compartmentalized operations. Moreover, with the exception of helicopters (and possibly transport aircraft), the technological overlap between civil aviation and military aircraft (particularly fighter aircraft) is small and not very conducive to CMI. As such, there are few opportunities to share personnel, production processes, and materials, and perhaps even fewer prospects for joint R&D or collocated production.
Likewise, China’s overall record of indigenous high-technology development and innovation has been mixed, further limiting opportunities for CMI. Many gaps and weaknesses still exist in China’s science and technology (S&T) base, and very little indigenous design and manufacturing actually takes place in much of China’s high-technology sectors. Rather, high-tech production is still oriented toward the fabrication of relatively mature consumer or commodity goods, such as DVD players or semiconductors, built according to original equipment manufacturer (OEM) specifications. In addition, China still lacks sufficient numbers of skilled designers, engineers, scientists, and technicians in crucial high-technology sectors, particularly IT, and so most high-end items, such as microprocessor chips, must be imported. Finally, many of the country’s high-technology incubators are still very much in their nascent stage, and Beijing continues to spend relatively little on high technology compared to the United States and the rest of the West. 
Moreover, much of China’s high-technology R&D and industrial base is still foreign-controlled, either through foreign-owned companies or joint ventures. Foreigners own virtually all of China’s high-technology intellectual property and most of its manufacturing capacity (such as semiconductor plants), and as such, 85 percent of China’s high-tech exports come from foreign-owned or joint ventures operations.  In addition, many foreign-established so-called R&D centers are actually geared more toward training and education than joint S&T development.
Overall, therefore, civil-military integration in China is still very much in its early stages, and both civilian and military authorities have yet to formulate a specific strategy for more effectively exploiting CMI. As one consequence, therefore, the R&D of defense-specific technologies, as well as the importation of such technologies, continues to be crucial in the modernization of the country’s military-industrial complex and in the development of next-generation weapons systems.
Nevertheless, CMI still has considerable potential to revolutionize the way militaries develop and produce defense-critical systems. It holds particular promise in the area of adapting commercial information technologies – technologies increasingly deemed as essential to transforming armed forces for next-generation warfare – to military purposes. For these reasons, therefore, China is likely to continue to search for ways to promote dual-use technology development and commercial-to-military spin-on.
1. U.S. Congress, Office of Technology Assessment (OTA), Other Approaches to Civil-Military Integration: The Chinese and Japanese Arms Industries (Washington, DC: U.S. Government Printing Office, March 1995), p. 3.
2. Tai Ming Cheung, Harnessing the Dragon: Civil-Military Integration and China’s Defense Modernization, paper presented to the CAPS/RAND conference on “Whither the PLA After the 16th Party Congress,” Taipei, Taiwan, November 7-8, 2002, pp. 3-6.
3. Evan S. Medeiros, Linking Defense Conversion and Military Modernization in China: A Case Study of China’s Shipbuilding Industry, manuscript, February 1998, pp. 2-12.
4. Cheung, Harnessing the Dragon, pp. 12-13; Evan S. Medeiros, Analyzing China’s Defense Industries and the Implications for Chinese Military Modernization, testimony presented to the U.S.-China Economic and Security Review Commission, February 6, 2004, p. 9; U.S. Department of Defense, Annual Report on the Military Power of the People’s Republic of China 2003 (Washington, DC: U.S. Department of Defense, July 28, 2003), pp. 31-34.
5. “China: The Allure of Low Technology,” Economist, December 18, 2002.