China's Army Operates Over
2000 Front Companies In US
Charles R. Smith

The Chinese army operates over 2,000 front companies inside the United States. Newly declassified documents from the Defense Intelligence Agency (DIA) show that China United Airlines is a one such front company.
China United Airlines is a most curious business. A Chinese air force general heads China United. China United aircraft also double as troop transports for the People's Liberation Army.
Yet documents obtained from the Defense Intelligence Agency show that China United is allowed to do business inside the U.S. without question.
The newly declassified documents from the Defense Intelligence Agency had the names of DIA agents withheld for national security reasons. In addition, a series of Commerce Department computer inquiries into the DIA records on China United Airlines also had sections deleted to protect "personal information in law enforcement records."
What the declassified documents do show is that the Commerce Department was informed in 1994 that China United Airlines is actually owned by the People's Liberation Army Air Force (PLAAF).
"China United Airlines (CUA) is a commercial entity of the PLA Air Force," states a 1994 report on the Chinese military issued by Lt. Col. Dennis Blasko, former U.S. defense attaché to Beijing. Blasko's report on Chinese military industries was obtained by a lawsuit against the Commerce Department in 1999.
"The major enterprise subordinate to the PLA Air Force is the China Lantian [Blue Sky] Industrial Corp," wrote Col. Blasko. "Also affiliated to Lantian is the Tian Ma [Sky Horse] Brand of vehicles and vehicle repair parts and facilities."
The newly declassified DIA documents noted that in 1995 the DIA listed China United Airlines as an enterprise "subordinate to the PLA Air Force." In addition, the DIA documents added Tianma Enterprises and China Anda Aviation as also being "subordinate to the PLA Air Force."
Selling Airplanes to the Chinese Air Force
Despite the clear lines of Chinese military ownership, the Clinton administration approved the sale of 10 American-made airliners to China United in 2000. The 10 Boeing 737 airliners are now officially listed as part of the People's Liberation Army Air Force. The Boeing jets are being used as troop transports, flying PLA officers into and out of remote military airbases in western China.
According to statements published by China United, the PLA Air Force-owned airline also operates a small fleet of Russian-made Ilyushin IL-76 jet transports. The IL-76 four-engine jet is the front-line PLAAF military transport, and the Chinese civil version is frequently armed with two 23 mm cannons located in a tail turret.
In 2000, the China United Airlines IL-76 transports dropped paratroopers, tanks and artillery directly onto the battlefield during the fall Chinese military exercises.
"Both Boeing and McDonnell Douglas aircraft were used to move a division of the 15th Airborne Army to Beijing for use in Tiananmen Square," said Richard Fisher, a senior fellow at the Jamestown Institute.
"If PLA commandos capture a Taiwan airfield, there will be scores of U.S.-made transports bringing in troops and weapons to make it secure," stated Fisher.
"There are several PRC airlines that are either owned or linked to the PLAAF [People's Liberation Army Air Force]," noted Fisher.
"They mostly fly Boeing craft, though some Russian airliners as well. I assume that most airliners in PRC airlines are subject to mobilization if necessary."
It is a fact that former President George Bush (Sr.) approved the sale of military transport aircraft to China, including several Lockheed C-130 heavy lift transport aircraft that were purchased by Air China, an airline 100 percent owned by the communist government. The C-130 Hercules is currently used by the U.S. Air Force as a heavy transport plane and has recently been used in Afghanistan as an aerial gunship.
Jiang Zemin's Airplane
The Clinton administration also approved the sale of a used Delta Airlines Boeing 767 to China United. The Boeing 767 was intended to become Chinese President Jiang Zemin's personal plane. The 767 was refitted at a Texas airport with sophisticated American-made electronics, including satellite communications and navigation systems.
Ironically, the aircraft was also fitted with a series of covert eavesdropping devices, including bugs placed inside President Jiang's airborne bedroom, bathroom and secure telephone systems.
The 767-bugging incident led to the arrest of China United head, Maj. Gen. Liu Taichi. Liu is the air force officer in charge of air travel for Chinese leaders and the chairman of China United Airlines, a military-owned commercial airline that buys the leadership's planes.
The youngest son of a revolutionary marshal, Gen. Liu is also the deputy head of the Chinese Army Air Force equipment department. Lui often traveled to the United States as a civilian, using his position at China United as a cover. He also became a familiar face inside U.S. aviation companies such as Boeing. During the Clinton years, Gen. Liu bought six Boeing planes for use as VIP aircraft.
"He [Gen. Liu] was one of Boeing's best customers," said a former business associate of the PLAAF commander in a recent article published by the Wall Street Journal.
The Washington Times reported that President Jiang suspected former Chinese Premier Li Peng was behind the bugging incident because of corruption charges against Li's wife and children. Later, during a press conference in Macao, Li Peng disputed reports that he was behind the bugging of Jiang's airplane.
Gen. Liu's arrest reinforced reports from intelligence sources that the U.S. had little if anything to do with the eavesdropping devices found on Jiang's airplane. Instead of publicly blaming the United States for the bugging incident, Chinese authorities have quietly tried to cover up the entire affair.
China United Spy Plane
Yet Gen. Liu's covert activities were not limited strictly to U.S.-made aircraft. For example, China United Airlines aircraft B-4138 is a Russian-made TU-154M three-engine airliner that flies under an international civilian number as a passenger plane.
The markings on B-4138 include large black block letters and the CUA symbol on its tail.
China United flight B-4138 is actually a Chinese spy plane. U.S. Defense analysts confirmed that the so-called civil aircraft is a Chinese air force spy plane equipped with sophisticated radar and communications equipment. The modified airliner is packed with military communications gear and has a huge radar dome on the bottom of the aircraft.
"The Tu-154M is indeed from China United," stated Richard Fisher.
"It is equipped with a new Synthetic Aperture Radar [SAR] system," noted Fisher, pointing out the characteristic tub-like radar dome that dominates the lower half of the Chinese spy plane.
"This Tu-154M is likely involved in research for the development of SAR systems that can be used in a similar fashion to the U.S. JSTARS, which provided unprecedented battlefield awareness to U.S. commanders in the Gulf War. For the PLA, this and future SAR aircraft will help to manage military operations over Taiwan and to find critical targets for air and missile strikes," concluded Fisher.

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