Updated January 23, 2023
Chinese Nuclear and Missile Proliferation
The U.S. government has continued to express concerns
facilities and 1997 changes to Chinese nuclear export
about China’s record concerning the proliferation of
policy, as well as other Chinese nonproliferation efforts.
nuclear- and missile-related technologies to other countries,
with more recent focus on the threat of Chinese acquisition
The United States has extensive nuclear cooperation with
of U.S.-origin nuclear technology. (See CRS In Focus
China, which is governed by a civil nuclear cooperation
IF11050, New U.S. Policy Regarding Nuclear Exports to
agreement, renewed in 2015. (See CRS Report RL33192,
China, by Paul K. Kerr and Mary Beth D. Nikitin.) Official
U.S.-China Nuclear Cooperation Agreement.)
U.S. government reports indicate that the Chinese
government has apparently ended its direct involvement in
The above-described changes in Chinese behavior took
the transfer of nuclear- and missile-related items, but
place after the two governments concluded their first
Chinese-based companies and individuals continue to
nuclear cooperation agreement in 1985. Laws subsequently
export goods relevant to those items, particularly to Iran
adopted by Congress required, as a condition for U.S.
and North Korea. U.S. officials have also raised concerns
implementation of the agreement, the President to submit to
about entities operating in China that provide other forms of
Congress certain nonproliferation-related certifications, as
support for proliferation-sensitive activities, such as illicit
well as a report about Beijing’s “nonproliferation policies
finance and money laundering.
and practices.” President William Clinton stated in a
January 1998 letter to Congress that China had “made
Background
substantial strides in joining the international
China did not oppose new states’ acquisition of nuclear
nonproliferation regime, and in putting in place a
weapons during the 1960s and 1970s, the Department of
comprehensive system of nuclear-related, nationwide
State wrote in a declassified January 1998 report to
export controls,” since concluding the 1985 agreement.
Congress. According to a 1983 National Intelligence
Estimate (NIE), China had exported “nuclear materials
Beijing acceded in 1992 to the Nuclear Nonproliferation
since 1981” that were not subject to International Atomic
Treaty (NPT) as a nuclear-weapon state (NWS) and has
Energy Agency (IAEA) safeguards. Beijing did so “mainly
voluntary IAEA safeguards on its civil reactors. The treaty
to earn hard currency,” the estimate assesses, explaining
defines NWS as those that exploded a nuclear weapon or
that the
other nuclear explosive device prior to January 1, 1967:
China, France, Russia, the United Kingdom, and the United
Chinese became aware in 1979 that they had
States. All other NPT states-parties are nonnuclear-weapon
insufficient resources for their initially grandiose
states. According to the treaty, a NWS is not to transfer
modernization program and that they needed to
nuclear weapons to “any recipient whatsoever” or to “in
generate more revenue through expanded foreign
any way … assist, encourage, or induce any” nonnuclear-
trade. Accordingly, the State Council directed its
weapon state “to manufacture or otherwise acquire nuclear
subordinate ministries in late 1979 to begin selling
weapons.”
surpluses.
China is also a participant in the Nuclear Suppliers Group
Consequently, according to the NIE, Beijing ended its
(NSG)—a multilateral control regime for nuclear-related
“abstention from commercial trade in conventional arms
exports. The Missile Technology Control Regime (MTCR)
and nuclear materials.” During the 1980s and 1990s, China
performs an analogous function for missiles and related
transferred nuclear and missile technology to other
items. China is not an MTCR partner but has agreed to
countries’ weapons programs. China provided assistance to
adhere to the regime’s export guidelines.
Pakistan’s nuclear weapons program and engaged in
nuclear cooperation with Iran. Beijing exported missiles to
The Chinese government continues to express support for
Pakistan, Saudi Arabia, and Iran. (For more information,
the international arms control and nonproliferation regime.
see CRS Report RL33192, U.S.-China Nuclear
According to a July 2019 Chinese government publication
Cooperation Agreement, by Mark Holt, Mary Beth D.
titled China’s National Defense in the New Era, “China
Nikitin, and Paul K. Kerr.)
actively participates in international arms control,
disarmament and non-proliferation” and “objects to arms
According to U.S. government reports and official
race and strives to protect global strategic balance and
statements, China significantly curtailed its nuclear- and
stability.” Similarly, Fu Cong, Director General of the
missile-related transfers during the 1990s; Beijing also
Department of Arms Control of China’s Ministry of
committed to improving its export controls. For example,
Foreign Affairs, stated during the December 9-10, 2020,
the 1998 State Department report cited above noted China’s
16th Asian Senior-Level Talks on Non-Proliferation that
1996 pledge to refrain from assisting unsafeguarded nuclear
“China is ready to enhance non-proliferation policy
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Chinese Nuclear and Missile Proliferation
exchanges and cooperation with all countries, including the
2017 Department of the Treasury report similarly assesses
incoming U.S. administration.”
that North Korea
Current Proliferation Concerns
uses and maintains a network of financial
As noted, official U.S. government reports indicate that the
representatives, primarily in China, who operate as
Chinese government has apparently ceased direct
agents for North Korean financial institutions …
involvement in nuclear-related proliferation and transfers of
these representatives orchestrate schemes, set up
complete missile systems. However, Chinese entities have
front or shell companies, and manage surreptitious
continued to engage in proliferation, and the U.S.
bank accounts to move and disguise illicit funds,
government has repeatedly expressed concerns with regard
evade sanctions, and finance the proliferation of
to weaknesses in China’s export control system. According
North Korea’s WMD and ballistic missile
to a 2019 Department of State report regarding states’
programs.
compliance with nonproliferation and arms control
agreements, “Chinese entities” continued in 2018 “to
Then-Deputy Assistant Secretary of State Alex Wong
supply MTCR-controlled items to missile programs of
asserted during a November 2020 speech that “China hosts
proliferation concern, including those in Iran, North Korea,
no less than two dozen North Korean WMD and ballistic
Syria, and Pakistan.” The United States also “raised a
missile procurement representatives and bank
number of [other] cases with China concerning” Chinese
representatives.” China has flouted UN Security Council
entities’ missile technology transfers to “programs of
resolutions’ requirements to expel such representatives,
concern” in those same countries, according to the report,
Wong claimed, adding that the United States has “provided
which added that, despite U.S. requests for Beijing to
China with ample actionable information on the ongoing
“investigate and put a stop to such activities, most of these
UN-prohibited activities occurring within its borders,” but
cases remain unresolved.” The 2021 version of the report
Beijing “has chosen not to act.”
states only that “Chinese entities continued to supply
MTCR-controlled goods to missile programs of
Media outlets have reported that China is assisting in the
proliferation concern in 2020.” Editions of the report
construction of facilities in Saudi Arabia for possible
published in 2016, 2017, 2018, 2020, and 2022 contain
uranium production. When asked about the topic during a
similar language.
September 2020 Senate Committee on Foreign Relations
hearing, Under Secretary of State for Political Affairs
The United States has continued to sanction Chinese
David Hale declined to provide any information, citing
entities for proliferation. For example, on November 25,
classification concerns.
2020, the State Department imposed sanctions on two
Chinese entities “for transferring sensitive technology and
China’s construction of civil nuclear reactors in Pakistan
items to Iran’s missile program,” according to then-
has been another source of congressional concern; the
Secretary of State Michael Pompeo. In August 2017, the
United States has argued that the projects violate Beijing’s
Department of the Treasury blocked U.S. assets of, and
NSG commitments. China has constructed four power
prohibited transactions with, a Chinese coal company for
reactors in Pakistan and is constructing two additional such
allegedly using foreign exchange generated from the sale of
reactors. Pakistan has IAEA safeguards agreements in force
North Korean coal to purchase “nuclear and missile
for all of these reactors. However, the NSG guidelines
components” for North Korea.
prohibit such projects in states, such as Pakistan, which lack
IAEA safeguards on all of the country’s nuclear facilities.
Regarding government involvement in these sorts of
Islamabad’s nuclear weapons facilities are not safeguarded.
transfers, former Deputy Assistant Secretary of State Vann
Van Diepen told Politico in 2017 that, even if the transfers
The United States argues that only the first two reactor
are not directly state-sponsored, “China hasn’t devoted the
projects are consistent with China’s NSG commitments;
priority, effort, or resources to thwart” such activity, adding
Beijing and Islamabad concluded contracts for these
that “when that continues to be the case over 20 years, even
reactors before China joined the NSG in 2004. At that time,
when they have been criticized, over time it becomes a
other NSG members agreed to “grandfather” only ongoing
choice, and you have to wonder what’s going on.”
Chinese reactor projects in Pakistan, then-Assistant
Secretary of State Thomas Countryman said during a May
U.S. officials have described other concerns with regard to
2015 Senate Foreign Relations Committee hearing. (For
Chinese proliferation behavior, such as money laundering,
more information, see CRS Report RL34248, Pakistan’s
the provision of illicit financial services, and illegitimate
Nuclear Weapons, by Paul K. Kerr and Mary Beth D.
procurement by entities operating within China. According
Nikitin.)
to a 2018 Department of the Treasury report, “Chinese
entities and individuals” have engaged in proliferation
Paul K. Kerr, Specialist in Nonproliferation
financing activities “for the benefit of” Iranian and North
Korean weapons of mass destruction (WMD) programs. A
IF11737


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Chinese Nuclear and Missile Proliferation


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https://crsreports.congress.gov | IF11737 · VERSION 5 · UPDATED

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