U.S. List of China Balloon Suppliers Hints at New Age in Surveillance

As the U.S. military retrieves debris from a Chinese balloon destroyed this month over the Atlantic Ocean, new indications are emerging from Washington of how high-tech components might point to a new Beijing spying threat. 

The Commerce Department on Friday named six Chinese enterprises as makers of balloon and airship equipment, which the agency alleged is connected to intelligence gathering by the People’s Liberation Army. The enterprises were added to a lengthy register of companies the U.S. aims to block from obtaining American high technology—sophisticated components and processes China lacks and that the government believes could be used to do harm to U.S. interests.

Meanwhile, U.S. authorities were continuing to assess a high-altitude object they haven’t publicly identified that was shot down Friday on President Biden’s order as it flew above Alaska. 

China’s government has so far not commented on the new sanctions or on the news of the flying object, nor responded to questions.

While balloons may be old school, the new sanctions coupled with the targets’ corporate profiles demonstrate U.S. concerns that China’s craft are wired for a new age in surveillance. 

Among the China-based suppliers blacklisted was the co-developer of an airship designed to fly far higher than aircraft, the holder of a patent for controlling aerial vehicles with satellites and artificial intelligence, a specialist in propeller flight equipment for drones and a producer of electronic sensors engineered for spacecraft. 

On their websites, some of the companies identify themselves as suppliers to China’s military. None is well-known. Also, their businesses don’t appear to include the manufacture of requisite balloon parts such as the giant fabric “envelopes” that billow with helium gas.

The Navy, among others, have spent a week scooping out of the Atlantic Ocean remains of what the U.S. said were solar panels, antennae and electronic apparatus attached to a 200-foot Chinese spy balloon. An American jet fighter destroyed the balloon with a missile this month after U.S. surveillance aircraft monitored it on a path across the American sky. 

The Pentagon in recent days has alleged that China’s military has deployed a fleet of high-altitude balloons for an aerial snooping program, and the public naming of component manufacturers is its latest evidence. 

Beijing says its downed balloon was a meteorological research craft that blew off course and that the U.S. overreacted by shooting it down.

Discovery of the balloon above the U.S. last week has added a new source of tension to an already bitter U.S.-China relationship and highlighted a military dimension to the rivalry between the world’s two largest economies. It led to the suspension of a visit to Beijing by Secretary of State

Antony Blinken

that both sides billed as an opportunity to put a floor under their problems. 

It’s unlikely China’s newly blacklisted companies are the sector’s only suppliers. The complexity of high-altitude ballooning, from the type of material used in the envelope that holds gas like helium to the payload of optical equipment and navigational systems on the ground, demands a broad array of systems.

“We’re a vertically integrated company, but we still have hundreds of suppliers to bring this to life,” says Ryan M. Hartman, president and chief executive officer of Tucson, Ariz.-based World View Enterprises Inc., which sends balloons to the stratosphere on the behalf of clients that include oil companies and the Defense Department. Mr. Hartman says the fixed costs of the imaging equipment and solar systems carried by the balloon can cost millions of dollars, while individual flights eat up hundreds of thousands of dollars to over $100,000 for single-use items like the helium.

The Chinese companies blacklisted over alleged ties to the PLA’s balloon endeavors include Beijing Nanjiang Aerospace Technology Co., China Electronics Technology Group Corp.’s 48th Research Institute, Dongguan Lingkong Remote Sensing Technology Co., Eagles Men Aviation Science & Technology Group Co., Shanxi Eagles Men Aviation Science & Technology Group Co., and Guangzhou Tian-Hai-Xiang Aviation Technology Co.

Efforts to reach the companies over the weekend were unsuccessful. 

The Commerce Department’s blacklist entries Friday are its latest actions aimed at slowing the technological advance of China’s military.

The department’s Bureau of Industry and Security stopped short of alleging the companies produced parts for the downed balloon. Its allegations are broader, that the entities have links to aerospace programs of the PLA, including airships and balloons and related materials and components. 

The bureau didn’t say what components might be sourced in the U.S. by the companies. They join a list of some 600 Chinese entities that are subject to U.S. sanctions in various forms that already includes telecommunications-gear maker Huawei Technologies Co. and surveillance-camera company

Hangzhou Hikvision Digital Technology Co.

Huawei Technologies Co. is among the Chinese companies subject to U.S. sanctions.


Photo: Bloomberg News

The administration has also taken other steps to restrict China’s access to Western technology in a bid to challenge the PLA’s power, including last year slapping export controls on advanced chip-manufacturing equipment required for the production of advanced semiconductors.

Corporate websites, online marketing, media reports and military procurement lists in China show each of the companies named by the U.S. on Friday produces specialized equipment that could have a role in the complex industry of high-altitude ballooning. 

In 2015, Beijing Nanjiang Aerospace developed China’s first airship for altitudes above those flown by jetliners known as near-space, according to Chinese government-run newspaper Science and Technology Daily. The solar-powered airship climbed above 65,000 feet from a launchpad in Inner Mongolia and had the ability to fly at all hours, according to the report, which said the craft made China a stronger competitor with the U.S., the global leader in near-space activity.

Also with near-space applications, Eagles Men Aviation Science & Technology has filed for patents in China for various high-altitude, unmanned aerial vehicles, from a video-enabled ground station control system to materials that are resistant to atmospheric conditions. It has developed algorithms powered by artificial intelligence for making satellite communication connections with unmanned aerial vehicles in near space, including balloons, according to a since-deleted description on its website. 

Public records suggest Eagles Men, which also uses other names in English, has links to Dongguan Lingkong Remote Sensing Technology Co. The records show they share an investor, and, in one case, ownership of a Chinese patent moved between the companies for a carbon-fiber structural component of stratospheric airships. Chinese patent filings separately show Guangzhou Tian-Hai-Xiang Aviation has developed a propeller-driven, drone-like vehicle for takeoff and landing.

The 48th Research Institute, a subsidiary of government-run China Electronics Technology Group Corp. that is based in Hunan province, advertises equipment on its website for making solar panels, lithium batteries, semiconductors and sensors. A supplier to China’s space program, the institute says on its website that its metal, hydrogen and pressure sensors have both civil and military uses.

In March, the 48th Research Institute awarded a tender for around $328,000 to a Shanghai subsidiary of Glenview, Ill.-based

Illinois Tool Works Inc.

for mass flow controls, according to documents on a procurement site maintained by China’s military. Illinois Tool didn’t respond to requests for comment on Saturday. Its controls are electronics that regulate the flow of gas.

Ian Talley and Selina Cheng contributed to this article.

Write to James T. Areddy at [email protected]

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