China's PLA Involved in Cyber Espionage: Report

TAIPEI - For the first time, a new report details China's signals intelligence (SIGINT) organization, including what role the People's Liberation Army (PLA) has in cyber intelligence collection.
The report, "The Chinese People's Liberation Army Signal Intelligence and Cyber Reconnaissance Infrastructure," by Mark Stokes and Jenny Lin of the Project 2049 Institute, Arlington, Va., provides the first overview of the PLA General Staff Department's Third Department, China's premier cryptologic service responsible for signals and cyber intelligence collection.

• 
  

The Third Department is comparable to the U.S. National Security Agency and appears to be diversifying its traditional SIGINT mission to include cyber surveillance, also known as computer network exploitation (CNE), the report said.
The Third Department's Seventh Bureau (61580 Unit) is responsible for CNE. Headquartered in Beijing, the bureau's engineers specialize in computer network defense and attack, and have conducted joint studies with the PLA Information Engineering Academy Computer Network Attack and Defense Section. The bureau has been known to conduct research outlining U.S. network-centric warfare and dense wavelength-division multiplexing.
CNE also is conducted by the Technical Reconnaissance Bureaus (TRB), Stokes said: "A senior engineer from the Hainan office was granted awards for network-related work, including possible surveillance of Voice over Internet Protocol."
The Chengdu Military Region's 1st Technical Reconnaissance Bureau also may be involved in cyber surveillance.
The degree of control that the Third Department exercises over the Technical Reconnaissance Bureau bureaucracies of the country's seven military regions is unknown, but Third Department's resources dedicated to high-performance computing and its large arsenal of skilled linguists could comprise China's cryptologic "A-Team."
"The combination of SIGINT and CNE, for example, fusing transcripts of phone conversations with intercepted email exchanges, would enable a powerful understanding of plans, capabilities, and activities of an organization or individual in near real time," Stokes said.
China could be cracking down on its own cyber warfare activities. Lt. Gen. Wu Guohua, who directed the Third Department from 2005 to 2010, allegedly was transferred out due to unauthorized cyber attacks.
"If true, it appears that senior civilian leaders could have some understanding of the political damage caused by overt, hostile network penetration," Stokes said.
Another possible reason for the dismissal could be that the Third Department overstepped its area of responsibility. It is possible the PLA has consolidated computer and network attack missions with electronic warfare into an "integrated Network electronic warfare" activity under the Fourth Department, responsible for electronic countermeasures, said Desmond Ball, a SIGINT and cyber warfare specialist at the Australian National University's Strategic and Defence Studies Centre.
"Use of the doctrinal concept of 'integrated network and electronic warfare' implies an attempt to link computer network attack and jamming," Stokes said.
Both the Third and Fourth Departments are said to jointly manage a network attack and defense training system.
Though the U.S. continues to blame China for alleged intrusions into U.S. government and defense industry computer networks, the Chinese believe the U.S. is the attacker.
"Chinese analysts believe that the United States is already carrying out extensive CNE activities against Chinese servers," Stokes said. "Therefore, from the Chinese perspective, defending computer networks must be the highest priority in peacetime."
Ball points to massive internal problems with malicious hackers and possible intrusions from foreign governments. Chinese officials have said that China is the biggest victim of network hacking.
The Beijing-based National Computer Network Emergency Response Technical Coordination Center released a report in March claiming that more than 4,600 Chinese government websites had their content modified by hackers in 2010, an increase of 68 percent over the previous year, Ball said. An incident in 2000 involving a series of high-technology combat exercises by the PLA was suspended when a computer hacker attacked the military's network.

Vietnam In Talks to Buy 4 Sigma-class Corvettes

TAIPEI - Vietnam is in talks with Dutch-shipbuilder Damen Schelde Naval Shipbuilding (DSNS) for the purchase of four Sigma-class corvettes, a U.S. defense official said.
Two of the ships will reportedly be built in Vietnam, where the technology transfer will be an "important contribution" to the country's ability to develop its navy and a "national capability for warship repair and maintenance," said Sam Bateman from the S. Rajaratnam School of International Studies at Nanyang Technological University in Singapore.

In 2005, Vietnam canceled plans to build Project 2100-type corvettes because the task was beyond its technical capacity.
"Vietnam has been able to assembly BPS 2000 corvettes from knock up kits, but was not able to step up to taking charge of the construction process," said Carlyle Thayer of the Australian Defence Force Academy.
But the SIGMA vessels - the acronym stands for Ship Integrated Geometrical Modularity Approach - "represents a revolutionary new modular technology in which ships from 50 meters to 150 meters can be built," Thayer said.
There has been no confirmation on what type of Sigma-class vessel is under consideration.
Vietnam will be joining Indonesia and Morocco in operating Sigma-class vessels. Indonesia began taking delivery of four Sigma-class vessels in 2007; a year later, Morocco signed a $2.12 billion contract for three vessels that are now being delivered.
"This represents a major stride forward in Vietnamese defense industry capabilities," Thayer said. "The SIGMA class represents a major step forward in technology and tonnage."
Vietnam's navy has been expanding both its surface and submarine fleet with new procurements from Russia, including Kilo-class submarines. The modernization effort is part of a response to China's growing military clout in the South China Sea and territorial disputes over islands claimed by both nations.
"The bottom line is that Vietnam is stepping up the pace of acquiring modern ships capable of defending Vietnamese interests in its Exclusive Economic Zone, such as armed escort for oil exploration vessels," Thayer said.
Beijing has thus far used mainly civilian enforcement vessels in its dispute with Vietnam, but now "China will now have to decide whether to accept the new status quo or commit to deploying PLAN [People's Liberation Army Navy] ships," he said.
In May, three Chinese vessels operated by the State Oceanic Administration harassed a Vietnamese oil exploration seismic survey vessel inside Vietnam's Exclusive Economic Zone.
China and Vietnam have been bumping into one another in the South China Sea since the 1970s. In 1974, China took the Paracel Islands by military force from then-South Vietnam, but Hanoi continues to claim the islands. Then, in 1988, China and Vietnam fought over the Johnson South Reef in the South China Sea. China sank two Vietnamese naval vessels and opened fired on Vietnamese troops occupying the reef, killing 30.

Taiwan Says Early Warning Radar Tests Underway

TAIPEI - Taiwan said Nov. 10 it has started testing a billion-dollar early warning radar system, designed to give an extra six minutes' warning of any Chinese missile attack, which is nearing completion.
Deputy Defense Minister Chao Shih-chang said the installation of the state-of-the-art, long-range radar system, supplied by defense giant Raytheon, has entered its final stage.

"The radar system has undergone initial tests lately," Chao said in response to a question in parliament.
"And the results showed that it has successfully linked to the Patriot anti-missile units and the Heng Shan military command," he said, referring to the emergency military command center in the capital Taipei.
Construction of the ultra-high-frequency radar - delayed for three years, partly due to the collapse of the road to the mountainous construction site - will be finished next year, the state Central News Agency said.
"This is the most advanced system of its kind in the world. ... It is crucial as the Chinese communists are aiming at Taiwan with more than 1,000 ballistic missiles," Chao said, adding it is also capable of detecting cruise missiles.
Critics say the system, which will cost more than 30 billion Taiwan dollars ($1 billion), is too costly given it will only provide six more minutes of warning.
Ties between Taipei and Beijing have improved markedly since Ma Ying-jeou of the China-friendly Kuomintang Party came to power in 2008, promising to boost trade links and allow more Chinese tourists to visit the island. But Beijing still sees the island as part of its territory awaiting reunification, by force if necessary.
China has repeatedly threatened to invade Taiwan should the island declare formal independence, prompting Taipei to seek more advanced weapons, largely from the United States.

Venezuelan Navy Chases Off Nuclear Sub: Chavez

CARACAS - The Venezuelan Navy this week chased off a "nuclear-powered submarine" that violated its territorial waters, President Hugo Chavez said, without pointing to any specific country.
In a televised call to state TV on Nov. 9, Chavez said naval forces had detected the submarine on Nov. 8 and pursued it, but "it escaped because it was much faster than ours."

"Obviously, given the speed and the velocity, it was a nuclear-powered submarine, but we are investigating," he added.
Chavez said his government had its "suspicions" concerning the origin of the vessel, but said "we are not accusing anyone" at the moment.
"We cannot say exactly who it was, because we have no evidence, but it was certainly a submarine," Chavez said.
He added that "the imperialists," referring to the United States, "have grown accustomed to strolling around the Caribbean and being all over the place, including by using satellites for espionage."
The fiery leftist Chavez has long accused the United States of meddling in Latin America and has cultivated ties with Washington's arch-foes, including Cuba and Iran.

China, Vietnam Vessels Collide At Sea – Literally

TAIPEI, Taiwan - A Vietnam Maritime Police vessel rammed a China Maritime Surveillance vessel within the past six months. Exactly where the incident ensued is unknown, but given the fact that it was a "police" vessel points to the likelihood it was within Vietnam's Exclusive Economic Zone (EEZ).
The video appeared on YouTube on Nov. 7 and shows a Vietnamese vessel ramming the Chinese vessel.

Sources in the region indicate that if it occurred after the July 20 agreement for the Declaration of Conduct guidelines for South China Sea claimant countries or after the Oct. 11 China-Vietnam agreement on basic principles to settle sea issues, it then raises questions on which country is in violation.
However, Vietnam is clearly the aggressor in the video, and the video demonstrates that the Vietnamese vessel violates safety of navigation and international regulations preventing collisions at sea.
Tensions from overlapping claims in the South China Sea have been rising in the past year as China increases naval patrols in the region and ignores the EEZ of its neighbors.
Since January, Chinese vessels have harassed Filipino and Vietnamese fishing- and oil-exploration vessels with greater regularity, including allegations China has placed equipment near Reed Bank, claimed by the Philippines.
On May 26, three Chinese state-operated Ocean Marine Surveillance vessels harassed the Binh Minh 02, a vessel owned by the oil company PetroVietnam, cutting a towed survey cable. Then on June 9, a Chinese fishing boat rammed a PetroVietnam vessel conducting an oil survey. Both incidents occurred within Vietnam's EEZ.
China and Vietnam have been bumping into one another in the South China Sea since the 1970s. In 1974 China took the Paracel Islands by military force from then-South Vietnam, but Hanoi continues to claim the islands. In 1988 China and Vietnam fought over the Johnson South Reef in the South China Sea. China sank two Vietnamese naval vessels and opened fired on Vietnamese troops occupying the reef, killing over 30.

TENSION TIMELINE

· Feb. 25: A Chinese frigate fired warning shots at three Filipino fishing boats near the Jackson atoll near Palawan Island, Philippines.
· March 2: Two Chinese maritime patrol vessels threatened to ram a Philippine government energy-research vessel, the M/V Venture, conducting a seismic survey in the Reed Bank area near Palawan Island.
· May: China announces a unilateral fishing ban for the northern part of the South China Sea from May to August.
· May: Vietnam alleges Chinese naval vessels fired on four Vietnamese fishing vessels near East London Reef and Cross Island.
· May: Chinese vessels laid steel posts and a buoy in the Amy Douglas Bank, southwest of Reed Bank within the Philippines Exclusive Economic Zones.
· May 11: Two unidentified fighter jets, said to be Chinese, were sighted near Palawan Island, claimed by the Philippines.
· May 23: Philippine President Benigno Aquino III warned Chinese Defense Minister Gen. Liang Guanglie during his visit to Manila of a possible arms race if tensions worsened over South China Sea disputes.

Coordinated Approach to Cyber Defense Urged

BRUSSELS - Countries need to have a good understanding of the cyber capabilities being developed by opponents, said a leading Israeli government official, because "you can't block an attack by waiting for the attack to come, including in cyber defense."
Isaac Ben-Israel, a senior cybersecurity adviser to the Israeli prime minister, was speaking at a Security and Defence Agenda event on cybersecurity.

Maj. Gen. Patrick Fermier, director of NATO C3 Staff, dodged a question about whether there was a need to improve cyber offensive capacity to improve cyber defense.
"NATO is trying to develop the protection of its infrastructure network," Fermier said. This is the first step, he added, after which "we'll see, at 28, what steps to take in the future. Protecting information and information sharing is a key parameter of success in any military operation."
Robert Bell, senior civilian representative of the secretary of defense in Europe and defense adviser to the U.S. ambassador to NATO, said that NATO needs to get all its agencies and commands under a single cyber defense roof by the end of 2012 and was on track to do that. He also said NATO needs to identify standards.
"We have no alternative except to work in close partnership with industry, which has much to teach us about the use of open standards to get us to the point where we need to be," he said.
Ben-Israel said Israel had realized in 2002 that the most vulnerable points are power production, water distribution, food supply etc. The country then set down a list of 19 key areas but faced a legal problem because most are owned or operated by the private sector. As a result, Israel had to change its laws and define how much government "intrusion" into the private sector was allowed in order to guarantee security.
The EU is faced with a similar issue in that a lot of its critical infrastructure is owned by the private sector. On this point, the German Ministry of the Interior has taken a stance in its national cybersecurity strategy, unveiled earlier this year.
"We are in favor of the alliance's commitment to establishing uniform security standards, which member states may also use for civilian critical infrastructures on a voluntary basis, as foreseen in NATO's new Strategic Concept," says the document.
Ben-Israel also said "there was a real threat from states and major criminal organizations." In that context, a report released Nov. 3 by U.S. intelligence agencies said, "the governments of China and Russia will remain aggressive and capable collectors of sensitive U.S. economic information and technologies, particularly in cyberspace."
Cecilia Malmström, the EU's commissioner for Home Affairs, pointed out that the EU has developed relations with NATO in this area and has a formal relationship with the U.S. But asked if there was an EU-NATO plan to respond to an Estonia-type cyber attack by another state or terrorist organization, she said that "there was no strategy."

U.S. 'Confident' on Pakistan Nuclear Weapons Safety

WASHINGTON - The United States believes that Pakistan's nuclear weapons are in safe hands, a State Department spokesman said Nov. 9, rebutting a report that Islamabad's atomic arsenal was vulnerable to theft.
Two U.S. publications, The Atlantic and the National Journal, citing unnamed sources, last week said Pakistan had transported nuclear weapons in low-security vans on congested roads to hide them from U.S. spy agencies.

State Department spokesman Mark Toner told reporters in Washington that the United States was not persuaded that safety had been compromised.
"We have confidence that the government of Pakistan is well aware of the range of potential threats to its nuclear arsenal and is accordingly giving very high priority to securing its nuclear weapons and materials effectively," Toner told reporters. "We continue to have confidence... that they're taking appropriate steps," he said.
Pakistan at the weekend rejected as "pure fiction" the report's assertion that transporting the weapons in such a manner had made them more susceptible to theft by Islamist militants.