China’s Efforts in Civil-Military Integration, Its Impact on the Development of China’s Acquisition System, and Implications for the U.S.

Abstract

Under the leadership of Xi Jinping China is significantly stepping up its efforts to pursue military-civil fusion (MCF) as an integral component of its whole of whole of nation development strategy of building a technologically advanced and militarily powerful state within the next 1-2 decades. This paper examines the making, nature and implementation of Xi’s grand MCF undertaking. This paper offers an analytical framework that seeks to provide a coherent and holistic view of the many moving parts and disparate elements of MCF through an innovation systems perspective. This framework identifies seven categories of factors that are important in shaping the structure and process of the MCF system: catalytic, input, institutional, organizational, networks, contextual, and output factors. Key dynamics that are examined in detail in the paper includes the high-level leadership engagement, the influence of the external threat and technology environments, application of new financial mechanisms such as hybrid state-private sector investment funds, the role of key state and military agencies, and the evolution of the Chinese defense acquisition system to embrace MCF. This analytical perspective also helps highlight the barriers to implementing the MCF project, particularly as it moves beyond central level planning to execution within a complex subnational political economy. The paper concludes with analysis of how the MCF grand strategy is impacting China’s own military modernization efforts and what the implications are for the United States and its defense acquisition base.