A U.S. think tank has recently pointed out two significant shortcomings in China’s defense industry. One is a potential personnel insufficiency, and two is a strong dependency on imports.

The report was released by RAND Corporation, titled “Assessing Systemic Strengths and Vulnerabilities of China’s Defense Industrial Base.” It was conducted under the U.S. Congress’s order and was completed in October last year.

In terms of workforce, the report anticipated that China could face an “upheaval” of available workers in the next ten years. The reasons include China’s low birth rate, an aging workforce, and gender inequality.

The report envisioned there would be problems with talents, explaining that a significant amount of Chinese studying overseas would not return to China after their education.

It cites, “In 2019, 1 million Chinese students were studying abroad, including more than 300,000 in the United States. Many will not return to China.”

Another critical vulnerability is China’s deep reliance on other nations in many vital aspects, including education, raw materials, advanced components, and intellectual property.

An indicator of China’s dependency is its “talent programs,” mainly focused on professionals and knowledge from overseas.

The report reads, “The sheer scale of China’s practices for gathering these resources—education and IP—from foreign countries indicates the country’s own view of these areas as domestic vulnerabilities.”

In 2019, researchers at the Center for Advanced Defense Studies discovered that the U.S. was the biggest supplier to China’s defense industrial base and nearly 20% of all of China’s imports for the sector. Furthermore, eight of the top ten other suppliers to China were also U.S. allies.

In the five areas of China’s top manufacturing imports in 2019, the U.S. and its ally, Japan, are leading suppliers in 4 categories. One of them relates to machinery, mechanical appliances, nuclear reactors, and boilers.

The other one is optical, photographic, cinematographic, and measuring.

The third area is vehicles other than railways.

The final area is pharmaceuticals.

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