UKRAINE – CHINA: from Project-to-Project Cooperation to Strategic Partnership

Valentyn Badrak (edt.)Sergei Zhurets (edt.)Dmitriy BogdanovVladimir KopchakOlga Nabochenko

Alexei Yarovoj

Published by the Center for Army, Conversionand Disarmament Studies

Kyiv - 2009

Ukraine — China:from Project-to-Project

Cooperation to Strategic Partnership

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In the current situation — wherebygeopolitical scenery around Ukraine is get-ting worse, fundamentally new challengesand threats are brought into being,NATO’s key European players Germanyand France are refusing to further supportUkraine, and the United States is keepingsilence over all this — China’s potentialrole has risen significantly in the eyes ofUkrainian military-political establishment.The PRC has silently evolved into a pow-erful, almost independent center of influ-ence on the planet; it has entered the eliteclub of permanent members of the UN Se-curity Council, and boasts of having theworld’s biggest military force of 2.25 mil-lion. China’s defense expenditure in-creased 14.9% in 2009 to reach well past $84billion – the world’s second largest defensebudget behind that of the United States.Having the world’s biggest foreign tradeturnover of $2.5 trillion and a GDP of

$4.402 trillion (according to IMF data for2008), China is wealthy enough to meet itshuge defense requirement.

In nominal GDP terms, the PRC isnow the third biggest economy in theworld, lagging only the United State andJapan. Amidst the ongoing global eco-nomic recession, the World Bank revisedits 2009 economic growth forecast forChina to 8.4%, up from the projection of7.2% made in June. China’s economy grew6.1% in the first quarter of 2009, but recov-ered to 7.9% in the second quarter and 8.9%in the third, according to the PRC NationalBureau of Statistics.

At the present stage of civilization’sdevelopment, amidst complex globaliza-tion processes, the PRC is set to take uponitself an alternative mission of global pro-portions. China — who achieved a GDPgrowth at a time of severe global economicslowdown, and increased its foreign trade

Ukraine-China: from Project-to-Project Cooperation to Strategic Partnership

Introduction.Why China?

Valentyn BADRAK

Sergei ZHURETS

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turnover by 21% from last year — hasmuch to be proud of (the PRC is reportedto have already outpaced Japan by the rateof economy growth). If this upward trendcontinues, China surpassing the UnitedStates as the world’s biggest economy issimply a matter of time. It is projected bythe PRC leadership that the amount of Chi-nese exports would have increased to $5trillion by 2020, with the proportion ofhigh-tech products rising to about 50% ofthe projected sum. In addition to this, thePRC has huge strategic ambitions for tech-nology and geopolitics, its technologicalambitions having grown to the extent thatthey became the subject of concern by theUnited States and Russia. If, a few yearsago, Moscow did not hesitate to sell Beijingan amount of naval versions of the S-300SAM system, today it faces uncertaintyabout the feasibility of supplying the PRCwith Su-33 carrier-based fighters. Chineseweapons designers have developed a no-torious reputation for successfully repro-ducing even most sophisticated designswithout gaining copyright permission.

China’s approach to dealing withproblematic geopolitical issues appears tobe interesting enough. Suffice it to have alook at PRC’s policies towards Pakistan. Inrelations with Islamabad, Beijing appar-ently took the ‘enemy of my enemy is myfriend’ approach. By persistently reinforc-ing Pakistan, China weakens India and re-duces freedom of maneuver for NewDelhi. These ambitions by Beijing are whatKiev is looking at with much interest. Onthe one hand, Ukraine still retains much tooffer China with respect to technology. Theother side of that coin is that the possibilityis not fully ruled out that China’s territo-rial ambitions and general geopolitical ex-pectations with regard to the Far Eastmight spur Beijing to begin actively rein-forcing Ukraine as an anti-Russian center

of influence on the Western front. Ofcourse, this is simply a matter of specula-tion. Even if it is assumed that Beijingchooses to adopt this scenario, it would notbe implemented straightforwardly. Still,such a scenario, in a certain specific situa-tion, might well become a reality.

Assumption that China’s ambitionswill certainly grow further could be vali-dated by one evident aspect of U.S. foreignpolicies. A broad consensus appears hav-ing been reached among the expert com-munity to the effect that a policy ofcontainment of China is one of the funda-mentals of the United States’ foreign pol-icy, not simply part of it. Success orunsuccess of this American policy will de-termine the entire future architecture of theinternational relations system. RAND Cor-poration, an influential non-profit researchorganization in the United States, contendsthat the PRC is the only country in theworld to be potentially capable to rival theU.S. in the amount and quality of availablemilitary resources and to present a virtuallyacross-the-board high-tech challenge.RAND experts believe that within a decadeChina would be able to supplant America asthe dominant military power in East Asia.

In the meanwhile, a few recent yearshave seen pretty perceptible changes inattitudes by some European countries tocooperation with the PRC, which mightserve as an extra argument in favor ofproposed Ukrainian-Chinese rapproche-ment. Some European countries (eventhough the limitations on defense sup-plies to China from the EU continue to beeffective) began systematic effort to ex-pand their respective arms export quotasfor the PRC, this being practiced not onlyby Paris but London and Berlin as well.These quotas are fully legal since selectedweapons types are not covered by theChinese arms embargo.

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Such a situation developing aroundChina with its consistent and independentpolicies, and, also, the rising challenges toUkraine in whom China has a long-terminterest, all speak of the feasibility and ra-tionale of proposed effort to ensureUkraine’s rapprochement with China inpolitics, technology and economy. Ukrainecurrently needs assurances of a differenttype and a different format. If neither Rus-sia nor the USA intend to assume that role,it is essential that Kiev identify "a thirdparty" who would be interested in a sus-tainably developing Ukraine. Paradoxicalas it may seem, it is China who might po-tentially act as a guarantor of this kind. ForChina itself, in the presence of potentialtensions in relations with the EU in case itis pressurized by the United States, astrong Ukraine integrated into Europemight be of interest, indeed. There is anopinion that China’s interest in Ukraine isexclusively technological, but this is onlytrue to a limited extent. Of course, Ukraineas a technology donor still retains much tooffer China, most specifically in rocket andaerospace technology. Despite China’smulti-year history of cooperation with theRussian Federation, a significant aspect inpotential cooperation between Ukraineand China in critical technology sectorsmight be that Ukraine and Russia wouldoffer China technologies that are not com-peting but, rather, complementing eachother. It might be said with a high degreeof certainty that China’s interest in Ukraineis partly explained by the fact that Kievnever attaches any political strings or re-quirements to joint projects in sensitive sec-tors. Intuitively, Kiev’s forging closepartnership relations wit Beijing in the mis-sile technology area, i.e. missile warheadtechnology improvement, might cause prob-lems in its relationships with Washington.

Given that the signatory states to the1994 Budapest Memorandum (who as-sumed commitments as to Ukraine’s sov-ereignty and security assurances) tend totake less and less account of Ukraine’s in-terests, this fact can and must become amajor reference point in Kiev’s talks withthe United States. Moreover, Ukraine,under the umbrella of the Chinese might,could try and alter it location on thegeostrategic map of the region (particularlythrough defense and dual-use technologytransfers) and, simultaneously, build up anindigenous missile shield powerful enoughto deter potential aggressor of any kind. Asfor China, who has in recent years begunmassive export of weapons and defenseequipment, not only does it visualizeUkraine as a technology donor, but, also,as a potential large market for its defenseindustry products, given that the PRC hasalready surpassed Ukraine in the develop-ment and production of a whole range ofdefense technologies.

It goes without saying that a conceptof a Ukrainian-Chinese rapprochementneeds to be thoroughly elaborated and ne-gotiated in detail with the Chinese party.Still, for Kiev, this idea looks far morepreferable than apprehending an escala-tion of tensions in relations with the statespoised to ignore national interests ofUkraine or disrespect their own securityassurances once provided to Ukraine in ex-change for its nuclear-free status.

In Chinese, the word ‘crisis’ is writtenin two characters meaning ‘danger/haz-ards’ and ‘opportunity/chance/’. Thiscombination could well and fully conveythe content of military-political and mili-tary-technological friendship between Kievand Beijing for the sake of forging a newrelevant strategy.

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he period of 2008-09 proved tobe a difficult trial for Ukraine’sstatehood. A systemic eco-nomic crisis, coupled with acrisis of security system, has

become a stimulus for changing a geopo-litical situation on the European continent.A research conducted by the Center forArmy, Conversion and Disarmament Stud-ies (CACDS) revealed a number of adversetendencies that might threaten Ukraine.

For one thing, Ukraine has lost itsvalue in the eyes of the NATO memberswho see in it a buffer strip between the Al-liance and Russia. Key European NATOplayers Germany and France have effec-tively refused to back Ukraine's Euro-At-lantic bids, and there are grounds to claimyet no such support for Ukraine on the partof the United States. It’s not a stretch to saythat European players of the North At-lantic Alliance have openly retreated intheir fight for Ukraine, opting instead formaintaining smooth and even relation-ships with Russia. All-knowing mediasources have been talking everywhereabout ‘Munich conspiracy-2’ plot. Rhetoricby the new American administration andthe character of the current dialogue be-tween the United States and the RussianFederation are all warning that Ukrainemight be ousted to the periphery of Euro-pean developments. In this new situation,Ukraine’s effort aimed at gaining for itselfa place among the European ‘club’ of na-tions is not expected to pay off until many

years from now. It could be predicted witha very high degree of certainty thatUkraine will not join NATO in the next 10years. If key NATO players in Western Eu-rope, most notably Germany and France,continue with their current policies to-wards Ukraine (i.e. refuse to supportUkraine’s NATO membership bid), it risksbeing left outside the Western Club and theEuropean Values System.

Second, the level of threats haschanged to the extent that experts begantalking about emerging risks to the Ukrain-ian statehood itself. Ukraine, weakenedfrom within, has long seemed to be a ‘sit-ting duck’ for some countries. Tough-worded statements by the leaders ofRomania, Russia’s voiced territorial claimsto some Ukrainian regions and open inter-vention with Ukraine’s domestic affairsand, finally, surprise and unprecedentedrefusal by Moscow to acknowledge the ex-istence of the Ukrainian nation are all di-rect consequences of a comprehensiveweakening and undermining of theUkrainian State. The first losses of theweakened state were quick to come -- thede facto loss of Zmeiny Island and theshaping of the image of the Ukrainian as anenemy to the Russian. Neighbors ofUkraine have an interest in weakening itspolitical influence and defense capability.Furthermore, the security assurances pro-vided by Russia and the United States in1994 in connection with Ukraine's acces-sion to the Treaty on the Non-Proliferation


First chapterIn search of comprehensiveassurances

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of Nuclear Weapons are ineffective nowand will continue so in the future if the sce-nario is unfavorable to Ukraine. This as-sumption might be clearly validated by the"Tuzla" conflict [Russian attempt to join theTuzla spit in the Sea of Azov to the Russianmainland], the so called ‘gas wars’ withRussia and the threatening Russian rheto-ric itself, as well as the Russian-Georgianwar conflict over South Ossetia. The 1994Budapest Memorandum on Security As-surances in connection with Ukraine's ac-cession to the Treaty on theNon-Proliferation of Nuclear Weaponsprovided security assurances for Ukrainein exchange for it laying down its nucleararsenal and committing not to use or pos-sess strategic weapons carriers. Ukraineeventually handed over its arsenal of 1,734nuclear warheads to Russia as demandedby signatory states to the Budapest Memo-randum. Obviously enough, the never end-ing feud between political forces inUkraine has effectively brought the coun-try to the brink of disaster where it maycease to exist as an independent statehood.It’s not a stretch to say that, as we approachthe end of 2009, Ukraine has reached a bi-furcation point where its further develop-ment may, with an equal degree ofcertainty, go down various tracks -- unidi-rectional or opposing one another alike.Many experts are unanimous in their opin-ion that all the prerequisites for a militaryintervention into internal affairs of Ukraineare in place now. Beginning in 2003, therehas been a rapid growth in the level ofpurely military and military-politicalthreats whereby the Ukrainian soil mayturn into a theater of military action. Thisthreat is becoming particularly imminentas loud voices are being heard demandingthat the issue of Ukraine’s nonaligned sta-tus be brought back on the agenda. The de-gree of this threat will steadily grow as we

approach 2017 when the Russian Black SeaFleet is to be withdrawn from Ukraine.

Third, the Ukrainian Armed Forces’development level has fallen to the lowestpoint ever since independence. TheUkrainian military is in the state of rapiddeterioration, with military morale declin-ing and carrier officers, not excepting thosein the General’s rank, voluntarily retiringby the legions. The military employsweapons arsenals and defense equipmentinventories that are almost one generationlagging behind those of the leading armedforces of the world in terms of state-of-the-art. Commentators are warning thatUkraine’s warfighting capacity is clearlynot adequate to the current level of militarythreats facing it. The CACS is placing onrecord that defense capacity of the Statehas been brought to total collapse. In all the18 years since independence, Ukraine hasfailed to build an effective battle worthyarmy. Issues of the military and those ofhomeland defense have not been ad-dressed as they should be; rather, theyhave been fully and systematically ig-nored. Such an indifference to own armedforces and their capacity to defend thecountry could be explained by the fact thatthe military in Ukraine has always been leftoutside the scope of the system of issuesover which political opponents can pres-surize each other. This system is unique toUkraine and comprises the Interior Min-istry, the Prosecutor General’s Office, thecourt system, the Security Service (SBU)and more organizations. The powers thatbe in Ukraine cannot see why they shouldbe concerned about the military if it doesnot bring them any dividends. A manifes-tation of such an attitude is that the Inte-rior Ministry’s budget for 2009, for the firsttime in a few recent years, has surpassedthat of the Ministry of Defense(UAH8.365bn as against UAH7.4bn).



Worse still, Ukraine’s Military Establish-ment has lost much of its development in-ertia; even three to four years of massiveinvestment would not bring it up to thebest developed armed forces in the regionin terms of combat effectiveness. In otherwords, it is highly unlikely that Ukrainewill be able to rely solely on its armedforces any time soon when it comes to de-fending its sovereignty and inviolability ofborders.

Fourth, vigorous activities by neigh-boring Russia at the diplomatic, economic,information and social levels, coupled withthe absence of any coherent informationpolicies by Kiev towards Crimea havebrought high on the agenda the self-identi-fication issue of a substantial portion of theUkrainian population in south and south-east regions. Against the backdrop of theabsence of a National Purpose, it could beplaced on record that a substantial part ofthe population are indifferent to whetherUkraine is independent or not. Ukraine’spolitical establishment has been either inthe grip of an infantile misunderstandingof the degree of the threats facing Ukraineor remains to be heavily intoxicated byRussian propaganda. One way or another,Ukrainian policy makers are clearlydemonstrating incompetence.

The above well explains why Ukrainehas found itself in a ‘high-risk area’. Thesituation is aggravated further by globaleconomic recession and deterioration ofecological, demographic, energy-relatedand ethical/moral problems of contempo-rary humankind which all brought our civ-ilization into a ‘discussion stalemate’ andare stimulating aggressive behavior. Ex-perts and analysts place on record thatabout 70 percent of all the countries acrossthe globe have been increasing their de-fense budgets and spending on associatedre-equipment/re-weaponing programs,

this trend being observed during the fifthconsecutive year now. Some experts pointto an increasing tendency of some coun-tries to be inclined to use military force forresolving tasks such as changing worldorder or redrawing the geostrategic map ofthe world.

With this background in hand 18years past independence, Ukraine wouldbe urgently advised to begin an activesearch of alternative ways to ensure na-tional growth and secure vital interests ofthe State, not excepting those of homelanddefense and national security. In this par-ticular case, orientation to China’s militarypower seems to be well justified.

China’s military accomplishments arereally impressive. During a military paradecelebrating China’s 60th Anniversary na-tional day on October 1, 2009, Beijingdemonstrated dozens of newest weaponsand military hardware types that have fun-damentally changed both the external lookand the image of the People’s LiberationArmy (PLA). Interesting enough, the Chi-nese military-political leadership claim thatthe PLA now rivals armed forces of theWestern World in terms of state-of-the-art.This is a very serious claim that could beseen as an evidence of China’s global am-bitions. The PLA is the world’s biggestarmed force with 2.25mn active militarypersonnel plus a reserve force of 800,000,followed by the United States with its1.4mn-member army. But what makes thePLA’s key accomplishment is the level oftechnology intensiveness that has risendramatically in the past decade. The PRChas consistently increased its defensespending during many years now; in 2004,for example, China’s officially declared de-fense spending jumped to about $25 billionfrom $22.37 billion in the previous years.Some analysts, however, think that the in-crease rate was 11.6 percent. Roughly the

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same growth rate has been observed in allthe following years up to 2010. Some ex-perts, though, believe that total spendingmight be as high as $40-45 billion annuallybecause the official budget doesn't includefunding for weapons programs that arenormally set on a single line in the budgetplan. The amount of China’s military ex-penditure has always been a subject of se-rious concern for the Pentagon. In a 2007report, the Pentagon suggested thatChina’s actual defense spending mightamount up to $139 billion, a significant in-crease over the publicly announced figure.In March 2009, Beijing was planning to in-crease its defense spending by 14.9%, up to$480.686 billion. In this context, a 2009statement by China’s leadership that itsmilitary arsenal is technologically roughlyon a level with the world’s most advancedarmed forces looks highly symbolic. In aninterview whose text is available on theChinese Ministry of Defense website, De-fense Minister Liang Guanglie said that thePRC has achieved a great milestone in itsmilitary modernization endeavor.

Ukrainian experts must not lose sightof an issue such as the Pentagon’s concernsover China’s anti-satellite and space war-fare capabilities. U.S. analysts believe that,over the next few years, the PLA wouldhave enough technological capabilities inhand to temporarily incapacitate or destroyAmerican satellites in any potential Sino-U.S. military conflict. This concern, basedon a thorough examination of the results ofChina’s January 2007 anti-satellite (ASAT)test, was voiced, especially, by Chairmanof the Joint Chiefs of Staff Admiral MichaelMullen. The Pentagon’s concerns are re-lated to the launch of China's first lunar or-biting satellite, Chang'e 1 in October 2007.Analysts believe that this launch was ofparamount significance not only for theChinese scientific community but also for

its military, especially in the context of itsspace warfare capability enhancement.Media reports had it that control of thesatellite was initially carried out by PLANavy’s satellite communication ships andone of its nuclear-powered submarines.The results of the test had never been pub-licly announced, but, if it was a success, thePentagon analysts say this could mean thatthe Chinese military will not have a longway to go to achieve a substantial progressin improving its ASAT capability.

Another area of priority attention forthe PLA leaders is the development of itsdisruptive warfare capability. Disruptivewarfare is a form of non-traditional, asym-metric warfare that aims to undermine anopponent’s strengths by exploiting weak-nesses. The Pentagon believes that China’slogical strategy is to favor asymmetric ca-pabilities that target and exploit the weak-nesses of China’s militarily superioropponents, especially the United States, in-creasing the potential that China can defeatthem. Information warfare operations, es-pecially cyber attack operations are attrac-tive to the Chinese military as anasymmetric weapon in that it is much moreeffective than traditional weapons. PLAanalysts believe that the Pentagon has anexcessive dependence on civilian computernetworks and its NIPRNET unsecured net-work. It is believed that by attacking thesenetworks the PLA would be able to disruptUS force deployments in Asia in a poten-tial U.S.-Sino conflict over Taiwan. PLAcommentators point out that by temporar-ily incapacitating or destroying these com-puter networks the PLA would disruptTaiwan’s capability to respond to a possi-ble act of aggression by China and, also,would reduce the U.S. potentialities for arapid intervention into a conflict should itarise. Media reports on that subject had itthat a disruption of computer networks



supporting communications, financialtransactions and energy supply in Taiwanwould cause a comprehensive panic,thereby forcing Taiwanese authorities toenter into talks with Mainland China.PLA’s printed publications consider infor-mation warfare operations as a pre-emp-tive weapon to prevent a conflict fromescalating further. Here, one of priority ob-jectives in information warfare capabilitydevelopment is protecting own computernetworks from hacker attacks. The PLAhas in recent years begun setting up dedi-cated research organizations to experimentwith various information warfare scenar-ios. Expert research programs in this do-main are well financed and an informationwarfare research and development net-work is being expanded. Interestingly, thePLA does not have an official informationwarfare doctrine, neither does it have thecapability to implement such a doctrineshould it be there.

American military experts believethat the information warfare concept cur-rently existing in China does not imply awar in its traditional, Western sense. It ismore targeted at non-military applications,in contrast to the West where military ap-plication of information warfare technolo-gies is more traditional. This approach towarfare offers China a possible solution tothe disparity between the capabilities of thePLA and U.S. forces, while not requiringChina to build a military fully equal to thatof the United States. The objectives of theChinese information warfare concept areprojected into a far future, decades awayfrom now, unlike an equivalent concept inthe United States which is aimed at accom-plishing results ‘right there, right now’.Many evidences have emerged now rein-forcing the perception that China is cur-rently conducting a non-Western-typeinformation warfare; China has recently

sought to collect information (most partic-ularly relevant to economy and defense do-mains), secure own information networksand the decision-making community, andto uphold national unity.

Of particular importance to Ukraine isan aspect such as the Chinese experiencewith the development of medium- andshort-range missiles. Research and devel-opment on missiles in this category hasbeen underway in China since the early1980s. Three groups of missiles have beencreated to date, known by their export des-ignations M9, M11 and M18. Most widelyfielded variant is the M9/DF-15 – a single-stage solid-fuel missile that was exportedto Libya (140 units), Syria (80), Pakistan,Iran and Egypt. The PLA Air Force andNavy additionally possess a combined ar-senal of 1,500-2,500 cruise missiles. Onemore reason why this experience is of im-portance to Ukraine is that the UkrainianAir Force has an inventory of Soviet-vin-tage tactical missiles. These missiles, whosedesigners left in Russia after the demise ofthe USSR, all need in-service support andmaintenance by Russian engineers, andUkraine, on numerous occasions, could notreach understanding with the Russian sideon that issue. Moreover, these arsenals areantiquated by modern standards, andtherefore need to be rejuvenated. Here, itmust be pointed out that orientation to asingle military-technological cooperationpartner has already had a detrimental ef-fect on military modernization. Ukraine, in2005, set for itself a task of developing amulti-target missile system combiningmedium-range and short-range capabili-ties. Ukrainian designers, while having ahistory in the field of strategic missile sys-tems, do not have any experience in the de-velopment of tactical/operational missileweapons. For this reason, relevant skillsand technology transfers with the PRC



would be quite justifiable and feasible. In-tuitively enough, that issue must be ap-proached with great caution, as someproblems may arise here, both in the con-text of limitations stemming from the in-ternational Missile Technology ControlRegime (MTCR) and at the level of rela-tionships with the United States. By thevery fact of seeking such an opportunity inrelations with the PRC, Kiev sends a mes-sage to international community thatUkraine deserves better attitude on behalfof the key players of global politics whotend to take little if any account ofUkraine’s vital interests. In recent years, aclear shift has become visible in the UnitedStates’ foreign policy, with more prioritygiven to the development of anti-terroristwarfare capabilities. This has lead to alle-viation of the U.S. foreign policy pressureon the PRC, and, simultaneously, openednew vistas for China’s enhancing its globalprofile. This situation could be actively ex-ploited by the Ukrainian diplomacy in se-lecting ways to set up a platform for moreintensive, expanded Ukrainian-Sino coop-eration.

It must be emphasized here in thiscontext that by modernizing its military thePRC is keen to max out scientific and tech-nological advances, creating a backlog ofknowledge for many years to come. Fur-thermore, the PLA leadership is seeking tomax out the effectiveness of new arms de-velopments by integrating into thembreakthrough upstream research achieve-ments. In such a case, achieving full inde-pendence from foreign defense suppliersremains a top-priority objective of the Chi-nese defense industry development. Thecurrent stage in the Chinese defense in-dustrial complex development is notablefor an integrated employment of a wholeset of various measures, including acquisi-tion of advanced foreign equipment and

technologies; cooperative research pro-grams; licensed production/co-produc-tion; own scientific-technical initiatives;expansion of indigenous production ca-pacities and modernization of the existingdefense-industrial base.

A characteristic of the current PLAtransformation/modernization stage is therealization by the country’s military-polit-ical leadership of the fact that the primerole in ensuring national security is as-signed to the PLA. A number of militaryoperations at the start of the XXI centurybrought to the fore the issue of a wideningtechnological gap between the armedforces of the Western World and those ofthe rest of the world. This increasinglywidening technological gap spurred theChinese leadership to urge the PLA to seekachieving ‘technological leaps’ in order toexpedite the development of new capabil-ities for increased maneuverability, fire-power and precision of fire by way ofcomprehensive informatization of the Chi-nese armed forces. Chinese analysts alsobelieve that the first two decades of the XXIcentury would be a critical period in thetransformation and building of new rela-tionships between the defense science/re-search community and arms industry inChina. This experience should not escapethe close examination of Ukraine’s mili-tary-political establishment, most particu-larly in the context of enhancement andreinforcement of the Ukrainian ArmedForces and orientation to capabilities ofown Military Establishment.

The PRC has for many years nowbeen developing cooperation in militarytechnology with the Russian Federation.This seems to be no impediment to Ukrain-ian-Sino cooperation, which is evident bya high enough level of this cooperationseen today. An important characteristic ofUkrainian-Sino cooperation in critical tech-



nology areas is that technologies offeredChina by Ukraine and Russia have differ-ent applications and are, therefore, com-plementing rather than competing witheach other. This perception is reinforced bya pretty high level of cooperation the PRChas maintained with Belarus, this beingboosted further by highest-level contactsbetween leaders of the two states.

At the same time, Ukrainian foreignpolicy with respect to China has been no-table for a lack of consistency. Even though[Ukraine’s defense import/export author-ity] UkrSpetsExport and some major de-fense suppliers, among them Motor-Sich[aeroengine maker] do have their respec-tive representative offices in China, no in-tensification of contacts has been observedat the top national level. Ex-presidentLeonid Kuchma, for example, paid two of-ficial visits to the PRC (one of them in atwo-leg tour that included a trip to UlanBator). The sitting president, ViktorYushchenko has never included Beijing onhis foreign tour schedules, and visits byForeign Minister Petro Poroshenko andDefense Minister Yuri Yekhanurov wouldnever have filled in the void in relation-ships with the key state dominating theSoutheast Asian region. Even so, we mustnot fail to take note that contacts have de-veloped pretty well at the industry-to-industry level. Also, expert appraisal of theexisting legal and regulatory frameworkfor Ukrainian-Sino cooperation is favorableenough. There has been active work by theUkrainian-Sino intergovernmental Mili-tary-Technical Cooperation Commissionco-chaired by first deputy Minister of In-dustrial Policy of Ukraine. Earlier in 2009,for the first time in many years, the Chief ofthe Ukrainian MoD’s Intelligence Direc-torate paid an official visit to Beijing, whichwas appreciated by the Chinese side as aconstructive and useful step forward in the

development of bilateral cooperation be-tween special services.

In forging cooperation with the PRC,one must be mindful that China stronglyopposes changing established rules of thegame or previous agreements. This atti-tude by China could be well observed fromproblems emerged in relations withUkrainian aircraft engine market ‘Motor-Sich’, over, as claimed by some observers,pricing policy changes. A few years priorto this, China cancelled its previously de-clared intention to acquire a large amountof Il-76 military-transport aircraft fromRussian suppliers, again, because ofchanges of previously agreed price tags.Also worthy of note is China’s tough atti-tude to quality issues of imported defenseproducts. If we regard a few recent yearsof military-technical cooperation, hereUkraine has at least one negative example,which is evidence, among other things, ofthe loss of Soviet-era production qualitystandards. In China’s eyes, Ukraine, sad tosay, still remains to be, to a certain degree,a nonresponsive inconsistent partner. Oneexample is that a well thought-out, onceproven noncash-payment scheme optiondid not work out again because the Ukrain-ian government failed to set up a frame-work allowing a defense exporter to barterits products for civilian goods. Not enoughclarity is provided with respect to privati-zation issues, either. Here, Ukraine cannotconduct a dialogue at an adequate level,while concrete questions about business-plans or international audit checks have,more times than not, been left unanswered.Furthermore, Ukraine does not seem tohave felt much urgency to push ahead witha transparent privatization program for itsdefense industry companies. On the otherhand, China will readily support projectstargeted at third-country markets. Alreadyavailable positive experience here gives



reason to hope for an expansion and fur-ther advancement of this area of coopera-tion.

China has always been distinguishedfor a well though-out, balanced foreignpolicy, and it therefore cannot be imaginedthat the PRC would sign any agreementsproviding security assurances to anybody.A thoroughly calculated, consistent foreignpolicy course will stimulate China to behighly cautious in taking decisions. Thereis certain to be no precipitation here. Still,interesting enough, China has a separateprogram facilitating cooperation with ex-Soviet states. This program provides for arange of mutually beneficial projects thatcould allow participating countries to en-hance their defense and technological po-tentialities. An important characteristic ofthe Chinese leadership is that they are dis-

inclined to take fast decision but, rather,tend to thoroughly examine and weigh inthe balance all the options available beforedetermining an acceptable response. Manyexperts believe that China has alreadylaunched a cautious advance on Russianinterests, but Beijing is very unlikely to gofor direct confrontation with Moscow. Theimportant positive side to Ukraine’s rap-prochement with China is that it does notaffect or run counter to its rapprochementwith Russia. If Ukraine is to have a rap-prochement with China, it has to evolveinto a consistent partner, unswervingly ad-hering to previously assumed obligations.Also, further advancement of Ukrainian in-terests in China calls for a high-level lob-bying and an intensification of bilateralcontacts between the leaders of the twostates.



s the defense market has de-veloped highly dynamically,it gets pretty difficult some-times to draw a line betweenwhere mutually beneficial

cooperation ends and open competitionbegins.

When analyzing in quantitativeterms the level of military-technologicalcooperation between countries, it is nec-essary to understand that volumes of de-fense contracts typically make noallowance for close international indus-trial cooperation ties where subcon-tracted companies supply subsystemsand assemblies, machinery, or assem-bly/repair kits, or replacement parts.

The topic of upgrading and repairsof numerous already operationalweapons systems and items of militaryequipment deserves a bit of its own at-tention. The establishment of large serv-ice centers in the Customer country isemerging as a new tendency observedamong proven first line defense suppli-ers.

In addition to industrial offset pro-grams, one of factors of no little signifi-cance is that defense customers areincreasingly keen to get an access to cur-rent-generation technology and, under-standably enough, to establish andfurther develop their capacities for re-verse engineering and licensed produc-tion. The latter trend is most apparentlyobserved in cooperation with China.

The PRC, who has vigorously worked tobring defense production processes to acommercial level and establish, in theshortest possible timeframes, indigenousmass series production of previously im-ported weapons types and items of de-fense equipment, has now beenprogressively transferring from the sta-tus of defense importer to status of pow-erful defense supplier. Here, a tendencycould be observed where the Chineseoutpace original design developers inputting reverse engineered designs intoproduction. Simultaneously, original de-sign developers who transfer their mostadvanced technology to China wouldhave had little time left to produce newdesigns and offer them to the market.The result is that the circle of technolo-gies that China would be interested toobtain has been increasingly narrowing.

As the situation is today, most se-vere competition has been developingalong two most visible lines. First, this iscompetition between Ukraine and Rus-sia over the Chinese market, and secondis competition within the Ukraine-Rus-sia-China triangle over third markets inthe Asian-Pacific Region, the MiddleEast and Africa as well as part of theIranian market. In the latter case,Ukraine has not been engaged in compe-tition for political reasons.

Due to the arms embargo imposedon the PRC by the USA and major de-fense suppliers in Europe following the


Second chapterPlace of Ukraine in the China-Ukraine-Russia triangle

A

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1989 Tainanmen Square massacre, Rus-sia and Ukraine still have had the abilityto sell out to China what has remained oftheir scientific research potentials, re-dundant weapons arsenals and surplusmilitary equipment inventories. In theeventuality that the arms embargoagainst the PRC is lifted, as has beenopenly pushed for by the EU countries,Western designers could propose Chinamore advanced technologies than Russiaor Ukraine can. On the other hand, how-ever, it is the desire by the West to put abrake on the growth of China’s techno-logical potential and military might thathas brought about the situation as it isnow, as Western nations clearly visual-ize China as a potent competitor threat-ening their defense industrialdominance.

Almost complete dependence ofUkrainian and Russian defense indus-tries upon the export market has evolvedinto a common threatening tendency forboth countries, this stemming from verylimited capacity of their respective do-mestic defense markets which cannot ab-sorb enough orders to provide domesticmanufacturers with sustained businessor large enough Government contracts.

One of the reasons why Ukraine orRussia cannot offer the defense marketany of their fundamentally new designsis very tight budgets of their militaryR&D and defense procurement pro-grams. Further aggravating the situa-tion, the break-up of sound defenseindustry cooperation ties that existed be-tween Ukraine and Russia prior to thedemise of the USSR has brought about asituation where it takes decades to de-velop new designs and turn develop-ments into products. The lack of ability(stemming from a range of objective eco-nomic reasons) for the designers to see

their developments through from con-ception to construction is conducive togrowing competition on the engineeringservice market. One more explanationmight be that most of basic design-fo-cused upstream research was carried outback in the 1970-80s, and as such the de-velopments are almost finished intellec-tual products that cannot be put to useunder the conditions where there are alack of operating assets, limited amountand value of Government defense con-tracts, and inability to solicit invest-ments, most particularly at the time ofeconomic recession.

On the other side of that coin, thereis a major slump in the quality of defenseproduction. In addition to a lack of ex-perience with independently doing de-sign and development, and a criticaldegree of obsolescence and wear-and-tear of manufacturing assets due tostaffing shortfalls, there has been a sharpdrop in the culture of engineering, aswell. A board of inquiry set up by theRussian Government to investigate thecause of a series of test launch failures ofthe submarine-launched intercontinentalballistic missile ‘Bulava’ could not iden-tify the cause of the failures for a longtime. At the initial stage of investigation,the finger was pointed to a subcontrac-tor who allegedly supplied faulty ejec-tion cartridges used in the separation ofthe missile's stages. Eventually, it wasconcluded that the most recent testlaunch failed because of a design andconstruction fault of the first stage steer-ing system. A fatal accident with theRussian nuclear attack submarine“Nerpa’ which left 20 people dead in No-vember last year could also be consid-ered a consequence of an overall declinein technical culture and a shortfall ofhighly skilled workforce.



In addition to this, there has been aconsiderable upset in the quality controlsystem that previously was based on theinstitution of Military Acceptance. Aswas pointed out in a final statement of aconference on defense industry develop-ment issues hosted by Russian NPO“Mashinostroyenie” (Scientific/Produc-tion Association “Mechanical Engineer-ing”), only one in ten defense companiesin Russia have international ISO qualitymanagement certificates thus far, whilein Ukraine, a volunteer qualification sys-tem for defense products has yet to takeshape.

Low-level procurements of qualityweapons systems and military equip-ment types result in fewer current-gen-eration systems being made available forarmed forces, thereby limiting their abil-ity to build up operational experienceswith such systems. According to expertfigures for 2009, latest generation sys-tems account for a meager six percent ofthe Russian Federation Armed Forces in-ventory.

It is worth of note that the PRC hasascribed great importance to militaryspecialist training, seeking to enhancethe overall educational level of the PLAmilitary personnel, which still remainspretty low. A few teams of senior-rank-ing PLA officers have taken trainingcourses at reputed universities inUkraine and Russia. Curiously enough,the Chinese trainees were less interestedin the training course content but morein the training process in and of itself --its philosophy, organization, approachesand technique – apparently revealingtheir intent to put into use the lessonslearnt in setting up massive military per-sonnel education and training grid inChina. They made no secret of PLA’s in-tent to have legions of its specialists ed-

ucated and trained at military universi-ties in Ukraine and Russia. In this con-text, it may be noted that the latter twohave openly competed on the educa-tional service market over Chinese stu-dents. The 6,500 Chinese students (plusPLA trainees) constitute the singlelargest foreign student contingent inUkraine (29.25pct of a 45,000-strong for-eign student contingent). By comparison,the Russian Federation has a populationof more than 25,000 Chinese students, in-cluding about 6,000 in Moscow and over4,000 in St-Petersburg. A considerableproportion of the Chinese student popu-lation have been specializing in technicaldisciplines related to defense technologyamong other things. A slant towardstechnical education is most apparentlyvisible among the Chinese student pop-ulation, which has not been observedamong student communities of othercountries. The foreign student popula-tion structure in terms of specializationis usually divided among three roughlyequal domains, with one third of stu-dents specializing in medicine, one thirdin technology and engineering, and acombined one third in oil and gas, ruraleconomy, culture and other disciplines.As Western medicine is not practiced inthe PRC where the Traditional ChineseMedicine dominates, medical studentsfrom China are not to be found inUkraine or Russia, which explains whythe proportion of students specializingin technical disciplines is much higheramong the Chinese student populationas compared to student communitiesfrom other countries.

Ongoing armed forces downsizingin Ukraine and Russia is conducive toclosures and mergers of military univer-sities, which has a highly adverse impacton the quality of military specialist edu-



cation and training there. Simultane-ously, there are occurrences where se-lected Ukrainian scientists and scholarsare invited to visit China to provide highpaying lecture courses on a variety ofcritical subjects relating, among others,to theory and practice of aircraft carrierbuilding, which reveals China’s desire toobtain valuable knowledge by this way.It could well be assumed that Russianscholars as well have been engaged toteach courses in China, both in privatecapacity or under lecturer exchange pro-grams.

Financial support being providedby China to selected renowned foreigndefense designers, and China’s engagingthem to assist in the design and devel-opment of indigenous arms and militaryequipment designs has in its basis the as-piration to get access to new-generationtechnology and build up own experiencewith independently doing R&D. This ob-viously suggests that the PRC has beendeviating from reverse engineering askey defense technology developmenttool and, instead, progressively redirect-ing its effort towards the establishmentof scientific schools of its own.

A factor of no little significance is thatChina is geographically close to the ThirdWorld countries who previously were tra-ditional customers for Soviet-suppliedweapons systems. Here, China has ex-panded its political influence on thosecountries and supplied them with licensedproduced weapons types. Western Euro-pean countries and their traditional marketson the Euro-Asian continent have been ef-fectively closed to defense suppliers fromRussia or Ukraine. Interests of defense sup-pliers are usually focused on countries withhigh GDP or excessive financial resources,whereas markets in underdeveloped coun-tries usually remain to be neglected.

In pursuing their military-technical co-operation policies, countries have to complywith current limitations relevant to so-called‘rogue’ states under a variety of internationalsanctions. While those limitations are dulyrespected by most of defense suppliers,China has openly acted in defiance of sanc-tions of any kind. As traditional markets fordefense supplies from Ukraine and Russiahad taken shape back in Soviet-era days, thetwo countries took to competing over theonce shared market space.

Holding huge financial resources inhand, China confines itself to purchasingsmall quantities, placing an emphasis onacquiring production licenses, engineer-ing documentation and manuals with anapparent goal of subsequently reproduc-ing the defense designs obtained. By en-gaging foreign developers to assist inR&D projects for indigenous defense de-signs, China pursues the objectives to getcomprehensive knowledge of current-generation technologies, obtain relevantexperiences and acquire intellectualproperty products without purchasingend products. Yet through it all, it mustbe noted that it was cooperation withChina that enabled survival of most ofthe defense companies that remained inplace in Ukraine and Russia followingthe Soviet collapse.

Either way, after acquiring sufficientscientific-technological potentialities tosupport its further technological develop-ment, China is going to give up coopera-tion with defense partners in Ukraine andRussia once it becomes economically un-feasible. Future cooperation will only takeplace with dynamically developing de-signer companies capable of independ-ently producing innovative designs. Itmust be noted for that matter that Chinaonce proposed Ukraine establishing arange of industrial partnerships and setting



up a research-and-technology park inUkraine, but those proposals have neverbeen materialized. Even though technol-ogy parks, according to statistics data, ac-count for no more than 13 percent ofinnovative product output, they attractpinpoint investments in promising projectsdue to access to low-soft lending programsand tax exemptions. Marked manifestationof inertia being observed there arises fromconsiderable juridical difficulties involvedin official registration of technology parkswhich require legislative amendments tobe established. Regarding defense compa-nies in Ukraine and Russia, cooperationwith China almost always takes place incases involving most easily producible de-fense designs created 20 to 25 years ago. Insuch a case, the shortest possible time limitrequired for China to reproduce a selecteddesign has been reduced to two years. Inthe opinion of a number of Ukrainian de-fense industry sources (general designersat premier defense companies), the end ofthe active phase of cooperation with Chinamight be expected in five to seven yearsfrom now, enough for the PRC to launchindigenous production of reverse engi-neered designs and oust Ukrainian andRussian defense companies from their tra-ditional markets. Truth be told, this doesnot apply (at least at this point in time) tothe AFV and aircraft engine domains.

On the other hand, the PRC, by mostconservative estimate, procured from $1.8to 2.0 billion worth of weapons and de-fense equipment in each of the recent 15years when it achieved a considerable mil-itary-technological quality leap. After-wards, the amount of foreign defenseprocurements was willfully reduced to theminimum.

By expert estimates, China will, in theforeseeable future, be able to establish pro-duction of most of the defense technologies

accessible to it in Ukraine or Russia. Thiswould enable it to emerge as a most power-ful competitor on third markets – powerfulto the extent as to oust Ukrainian and Russ-ian defense companies from their old tradi-tional markets, with only few criticaltechnologies remaining the exclusiveprovince of Ukraine and Russia.

Basically, cooperation and growingcompetition between the three countriescould be observed on markets for the fol-lowing:

•Satellite launch services andco-development of satellite navigationsystems;

•Aeronautical technologies;•Land warfare equipment;•Naval ships and related

weapons and systems;•Air defense systems.

In addition, separate considerationshould be given to:

•Rocket and missile technolo-gies;

•Control and communicationsystems, electronic intercept radio intel-ligence systems, electronic warfareequipment;

•Joint R&D activities;•Educational services (military

specialist training)

Problems involved insafeguarding intellectual property rights

Some interesting relationships, bothin legal and moral terms, have arisen be-tween individual companies in Ukraine,Russia and China as well as at the trina-tional level over intellectual-propertyrights to technologies involved in some orother military design.

At the panel session on “Problems in-volved in safeguarding intellectual prop-



erty rights relating to defense-industrial co-operation between the Russian Federationand foreign states” that took place in Janu-ary 2008 as part of the Infoforum-10 on“Safeguarding intellectual property rightsand the exploitation of the results of intel-lectual property”, hosted by Moscow’s Sci-entific Research Institute of IntellectualProperty, it was pointed out in a reportpresented by E.A.Livadny that the ChinaNorth Industries Corporation (NORINCO)was manufacturing without proper licensesome individual small arms weapons typesderived from the Kalashnikov AK-47 as-sault rifle: Type 97, Type CQ, Type 56(copy of the AK-47), Type 68, Type 81,Type WQ 314 and Type WQ 314A. Thesame report said that China has establishedproduction of reverse engineered copies ofsome of Russian-designed weapons sys-tems, among them the AO-80K air defensegun, the laser-guided 155mm projectile‘Krasnopol’ and the ‘Fregat M2EM’ navalradar, as well as the naval radar ‘Mineral-ME’ designed by what is now the State En-terprise ‘Scientific-Research Institute ofRadar Equipment ‘Kvant-Radiolocation’based in Kiev.

Ukrainian designers are speaking ofnumerous facts where equipment oncesupplied to China had, while under war-ranty, been subject to unauthorized open-ing with the aim of studying the structureand construction of, and subsequently re-producing its constituent subsystems.However, no official complaints have everbeen made out of fear of losing well-pay-ing customers.

Most illustrative in terms of copyrightprotection might be the two examples asdescribed below.

First is about the contract from Chinato supply four Type 1232.2 ‘Zubr’ smalllanding craft air cushion vehicles, whosesigning was announced in May 2009 by the

Ukrainian Minister of Industrial Policy,V.Novicki. Even though Ukraine and Rus-sia had previously jointly carried out a sim-ilar contract to supply four same-class‘Zubr’ air cushion landing vehicles to theHellenic Navy, neither of the two has thecapability to build vehicles of this type sin-gle-handedly. Ukraine’s workshare inbuilding vehicles of this type is estimatedby analysts at no less than 40 percent, plusa major part of warranty and post-war-ranty servicing provided by Research andManufacturing Gas Turbine CorporationZoria-Mashproekt. Competition over theHellenic Navy’s contract was fierce; it evencontinued when work on the contract wasalready in progress, which resulted in a re-vision of the terms of the deal. The resultwas that the value of the $200mn contractpreviously equally shared between theUkrainian and Russian contractors was re-distributed in the latter’s favor by a factorof 1 to 3. The situation was eventually re-solved to satisfaction of Ukraine who wasawarded a compensating contract to sup-ply a TP-400-type ship transporter plat-form built at Sevmorzavod ShipbuildingYard in Sevastopol. The value of the ‘Zubr’contract with China may amount to$315mn, provided that the supply packageincludes the complete set of engineeringdocumentation and manuals as demandedby the Customer. It was reported by vari-ous media sources that Russia was negoti-ating the transfer of production license forthe Zubr to China in 2007, in a package in-cluding the supply of 10 to 15 such vehiclesto be built at Russian shipyards. At variousstages of the negotiating process, theamount of the supply varied from four ve-hicles (for $215mn) to six and ten vehicles,but the negotiating parties had never ar-rived to any compromised agreement. TheRussian company Central Maritime Designand Development Bureau ‘Almaz’ based in



St.-Petersburg has stated that the Ukrain-ian party violates its intellectual propertyrights by transferring (or selling) engineer-ing documentation and manuals for the‘Zubr’ small landing craft air cushion vehi-cle to a third party without the Designer’sauthorization. UkrSpetsExport, Ukraine’sdefense import/export authority, does rec-ognize that copyright to the ‘Zubr’ designbelongs to Almaz. Simultaneously, itpoints out that air cushion vehicles of thisdesign have been built by Ukrainian ship-building yard FSK ‘Morye’ on the strengthof bilateral agreement on intellectual prop-erty rights to ex-Soviet military designs,which allows the signatory parties to em-ploy design concepts, engineering docu-mentation and manuals available to them.It requires that any kind of activities in-volving the use of copyrighted designs orsafeguarding intellectual property rightsshould be performed in agreement be-tween the signatory parties, but says noth-ing about the intellectual property rightsemerged in between the collapse of the So-viet Union and the day when the agree-ment took effect a couple of years ago.

Therefore, the companies — fully com-prehending that in absence of contracts forthe building of vessels of this unique designthey would lose the capability to build themor would cease to exist altogether -- are keento take advantage of the last opportunity toimprove their situation through the Chineseorder. It is obvious to all that exports ofRussian- or Ukrainian-built Zubr-type ACVswould reduce to near zero once China getshold of the documents required for produc-tion of the hovercraft of this design to belaunched at its own yards. As the situation atthe Ukrainian shipbuilder FSK ‘Morye’ is farworse than that at Almaz, the former wouldagree to cooperate with China on much lessbeneficial terms and conditions, which in-deed is what would suit the book of China.

Exactly the converse situation interms of safeguarding intellectual propertyrights is being observed with Ukraine’s topdesigner of naval radar systems, the Kiev-based Scientific Research Institute of RadarEquipment ‘Kvant-Radiolocation’. Its port-folio of highly successful Soviet-era de-signs includes a range of 2D and 3D navalradar systems, among them the ‘Pozitiv’,the passive radar system ‘Mineral’, the tar-get designating radar system ‘Uspekh’ andthe ‘Mars-Passat’ (the Soviet alternative tothe US-designed integrated naval weaponssystem AEGIS). Not only Kvant-Radiolo-cation is designer of naval radar equip-ment, but it also employs a manufacturingplant in Kiev to series-produce own de-signs.

Kvant-Radiolocation is currently as-sisting its Russian counterparts in pre-pro-duction works at a newly-built factorywhere it was planned to be relocated at thetime before the USSR fell apart. Russianmanufacturers of Kvant-Radiolocation’sdesigns are telling potential customers thatwhat they offer them are all their own de-signs that they sell with a minimum modi-fication. They don’t even bother tore-designate the ‘adopted’ designs, exceptfor changing the last few symbols in theoriginal designation name. In this particu-lar case, Kvant-Radiolocation has a stronginterest in already existing cooperation tiesto be maintained and developed further; ithas opted to forget ‘past endeavors’ andconcentrate its effort on new developmentsrather than to compromise relationshipswith Russian partners.

Kvant-Radiolocation is currently asuccessful supplier of radar equipment toChina. It is now completing design and de-velopment of a command and control com-puter system (C2CS, an equivalent ofAEGIS-class integrated command/man-agement information system) for PLA



Navy’s new Type-956 destroyers and, pos-sibly, future aircraft carriers. In addition tothis, Kvant-Radiolocation supplies a con-siderable portion of radar and optoelec-tronic systems for naval ships being builtfor the PLA Navy in Russia. In so doing,the Ukrainian company does not raiseclaim either to Russia or China. To make anestimate of Kvant-Radiolocation’s contri-bution, suffice it to have a look at the com-position of the electronic countermeasureequipment package on the PLA Navy’sType-965E and Type-956ME destroyersthat were supplied as wholly Russian-de-signed without any mention made what-soever of the Ukrainian contribution. Inaddition to electronic warfare equipment,the propulsion-machinery plant on the de-stroyers was designed in Ukraine’s Zapor-izhzhia, as well. It might be noted for thatmatter that the PRC has already launchedthe effort to design and develop indige-nous copies of some Russian-supplied de-stroyer types, whereas Russia has yet tolaunch the development phase of a new de-stroyer design where a premium is beingapparently placed on innovative navalweapons designs developed with revenuesfrom the Indian Navy’s contracts. Ukraineand Russia both want to tap into the prom-ising market for stealth corvettes, and in-tend to begin design and development offuture frigates of indigenous designs. Inthe marketplaces for corvettes and frigates,China has successfully promoted its earlierdesigns on Asian-Pacific markets.

In the case of hydroacoustic equip-ment, similar situation could be observed.Here, however, Ukrainian company Kiev’sScientific Research Institute of SonarEquipment is in a worse standing, beingovershadowed by its Russian counterpartand not having a large enough portfolio oftorpedo systems products. China previ-ously was making attempts to reproduce

Soviet-supplied weapons types, amongthem the P-15 cruise missile. But test flightsof P-15 clones have all failed, as Chineseengineers did not know even the first wordabout rocket building. Ironically, now an-tiquated concept of closed architecture (asopposed to newer open-architecture con-cept) is more effective in terms of copyrightprotection in that it does not allow poten-tial users to see inside or reproduce all orparts of a specific weapons design archi-tecture. Even though the Ukrainian com-pany is involved in the design anddevelopment of almost the complete set ofsonar system types (underkeel, towed,add-on, helicopter-deployed), its productsstill remain an unknown quantity on mostof potential markets. Nonetheless, Ukrain-ian companies enjoy pre-eminence in theglobal market for airborne anti-submarineradio sonobuoys, with the Russian Federa-tion and some NATO countries beingamong major customers. Radio sonobuoysof the RGB series (RGB-15/16/17/25/55/75) had been series man-ufactured at a factory in Kiev and,previously, in Nova Kakhovka. Kiev’sRadio Equipment Factory supplies ‘Os-minog’ (Octopus)-series target search andtrack radar systems for integration with theK-28 helicopters exported by Russia toChina (to date, seven units of the ‘Os-minog’ radar system have been supplied).In this particular case, not only do Ukrain-ian companies provide support for Russiandefense export contracts with the PRC, but,to a certain degree, maintain a strangleholdon some niche markets.

At the time when Ukrainian andRussian economies were in deep collapsein the first few years immediately follow-ing the disintegration of the USSR, neitherof the two could afford further maintain-ing naval vessels of that big displacementand, simultaneously, both were in desper-



ate need of cash. As a result, China had ob-tained a few large naval ships that onceepitomized the heyday of the Soviet navalshipbuilding school of thought, at a priceeven cheaper than that of ferrous scrap ofan equivalent weight. In such a case, Russ-ian military officials managed to transfereven some top-secret assembly units toChina. The Type 11436 aircraft carryingcruiser ‘Variag’ was towed to Dalyan Ship-yard from the Black Sea Shipbuilding Yardin Mykolayiv when it was 67% ready in2002. Here, the PRC, while trying to see in-side the obtained military equipment de-signs, has been simultaneously makingattempts to establish indigenous militarydesign schools of thought and engineer in-novative construction materials without ar-bitrarily copying the technology solutionsacquired. This point could be underscoredby China’s development of indigenous tor-pedo weapons system series derived fromAmerican, Italian and ex-Soviet counter-parts. The Chinese have built an indige-nous current-generation torpedo systemand, on a parallel track, developed a fewinnovative construction materials, i.e. forthe torpedo’s fore section, a design whoseengineers have been awarded a state prizeby the PRC Government.

Ukrainian and Russian naval design-ers have complemented each other on anumber of niche markets, which has impli-cations for their respective intellectualproperty rights. Conflicts do arise in situa-tions where copyright holders begin ‘tilt-ing at windmills’ when they realize thatthey have nothing new to offer the market.

The nature of copyright abuses lies indifferences between free-market Westernideology and socialist ideology. Remainingfully socialist, the PRC, as did the USSR inits own time, has openly abused intellec-tual property laws in the hunt for newtechnology. Officials at some defense com-

panies believe that visits by Chinese dele-gations on some occasions are not aimed atforging a deal but, in actual fact, are mani-festations of industrial espionage aimed atcollecting information about new technol-ogy and directions of future developments.Of course, some manifestations of open es-pionage (which is punishable by law) dotake place, as well. On July 28, 2009, Russ-ian Customs officers at Zabaikalsk-Manchuria international automobilecheckpoint detained an exiting Chinese cit-izen attempting to smuggle fighter aircraftpower supply equipment that was dis-guised as pressure devices hidden in theluggage boot of his vehicle. Intellectualproperty protection issues are closely in-terrelated with keeping commercial andGovernment secrets, most notably in caseswhere potentialities for future cooperationand the status of modern designs make thetransfer of new (but not newest) technolo-gies quite feasible. Intellectual propertyprotection issues involved with military-technological cooperation programs of theRussian Federation, Ukraine and the PRCdo exist for the copyright holders who can-not develop themselves further or offermanufacture-ready innovative design so-lutions. No matter whether an appropriatecontractual basis is in place or not, anykind of a weapons system or an item ofdefense equipment obtained from a for-eign supplier may, to some or other de-gree, potentially provide a basic designaround which to build an indigenous de-rivative. For this reason, weapons typesdesigned for the export market shouldnot contain newest-generation designsbut, rather, those of the latest but one gen-eration. As is lamentably often the case,some Ukrainian defense designers, leftwithout Government support, would notstop short of selling out their most latest,if not last designs.



Competition on the space services market

Russia and the PRC both have thepossession of a great deal of modern-gen-eration ballistic missiles, while Ukraineboasts of having a very rich experiencewith designing, developing and manufac-turing them. However, cooperation in theballistic missile area — because of nationalsecurity considerations and the limitationsassumed by countries in connection withtheir international obligations relating tononproliferation of missile technologies –is restricted to the development of new ma-terials. Simultaneously, there is a fiercecompetition observed on the space launchmarket where each and all members of thespace-faring club have been engaged. Amost distinguishable characteristic of thespace services market is reluctance by anyof the market players to share critical tech-nologies with competitors.

Even though the PRC has been build-ing indigenous space launch vehicles andhas launched a human spaceflight itself, itis still lagging in this domain far behindother countries, including Russia andUkraine.

Russia and Ukraine both have optedthe way of converting intercontinental bal-listic missiles into commercial space launchvehicles (SLVs). The SLV ‘Rokot’, for ex-ample, has been built by way of convertingthe PS-18 (NATO reporting name SS-19‘Stiletto’) ICBM. Rokot employs theStiletto’s boost cluster as the first and sec-ond stages, while the upper stage is thenewly-developed ‘Briz-KM’. Ukrainiancompany OJSC ‘Khartron’ based inKharkiv is the designer, maker and sup-plier of control systems both for the SS-19Stiletto ICBM and the Rokot SLV. Controlsystem hardware for the ‘Briz-KM’ upperstage was developed by Khartron, while

Russian partners provided the softwarecomponent. Therefore, in this particularcase, Ukrainian and Russian companies arecomplementing one another.

CJSC ‘Cosmotras’, a joint partnershipbetween Ukraine, Russia and Kazakhstan,has been converting the RS-20 (NATO re-porting name SS-18 ‘Satan’) ICBM into the‘Dnepr’ SLV for Russia, and it employs theconverted rocket for launching small satel-lites from the Baikonur Cosmodrome inKazakhstan and a launch site of the Russ-ian Strategic Missile Forces’ Yasnensk Mis-sile Division in Orenburg Region.

On August 31, 2009, Chinese launchvehicle CZ-3B partially failed during thelaunch due to a third stage malfunctionwhich resulted in Indonesian communica-tions satellite Palapa-D1 reaching a lowerthan planned orbit. This was the first inci-dent involving Chinese space launch vehi-cles in 13 years since August 1996. To date,the PRC has carried out 77 successful spacelaunches, revealing its aspiration to seizepart of the space launch market.

In late June 2009, international consor-tium Sea Launch that comprises Ukrainianparticipants ‘Yuzhnoye’ Design Bureau andNPO ‘Yuzhmash’ (a leading provider oflaunch services to the commercial satelliteindustry) filed voluntary petitions to reor-ganize under Chapter 11 of the United StatesBankruptcy Code in the United States Bank-ruptcy Court for the District of Delaware.Usually well-informed sources believe thatthe main reason why Sea Launch has sloweddown the rate of its operations recently is in-ability by Russian company NPO ‘Energo-mash’ to supply Yuzhmash with sufficientnumbers of sustainer engines for Zenith-3SLrockets employed for Sea Launch opera-tions. They are claiming that Energomash isnow more focused on cooperation withLockheed Martin, supplying it with sus-tainer engines for its ‘Atlas’ SLVs.



A project is now nearing completionin Ukraine to build a prototype of a funda-mentally new SLV design to be known asCyclone-4. Being designated as theyoungest member of the Cyclone family,the Cyclone-4 will, in actual fact, have littleif anything in common with its older sib-lings. The Cyclone-4 has been scheduled tobe ready to carry out its maiden launchfrom the Alcantara Space Center (Centrode Lançamento de Alcântara) in Brazil inlate 2010 or early 2011.

It might be noted that, according toexpert estimates, space launch services ac-count for only about 5% of the overallvalue of the space services market. Here,most of the market in value terms is ac-counted for by services for the design, de-velopment and construction of spacecraftand relating systems. This market is domi-nated by the U.S., Great Britain, France andthe Russian Federation. As far as Ukraine isconcerned, it has successful experienceswith building Earth monitoring satellitesbut still does not have even a single com-munication satellite of its own. Ukraine’sfirst ever communication satellite will bedesigned, developed and built in Canada.

Separately, it may be noted thatUkrainian companies have provided de-signer’s technical supervision and in-ser-vice support and maintenance for theintercontinental ballistic missiles remain-ing on stand-by duty in Russia. In such acase, Moscow is apparently reluctant to tapUkrainian rocket builders for own ICBM-focused programs, while being obviouslyincapable of developing and building mis-sile systems on its own. Russian designerswill certainly eventually succeed in creat-ing a current-generation ICBM design sometime in the future, but by engaging Ukrain-ian partners to assist in that effort theywould achieve this goal more sooner and ina more efficient yet less expensive way.

The PRC is apparently experiencingdifficulties in building its indigenous satel-lite navigation and positioning system Bei-dou (‘Northern Dipper’ or ‘Ursa Major’).Incidentally, the Russian-Chinese joint-venture partnership Ural & HangshengAutoelectronics Co. Ltd., anticipating al-most simultaneous arrival of China’s Bei-dou and Russia’s GLONASS satellitenavigation systems to the market, has al-ready launched the design and develop-ment of a receiver combining Beidou andGLONASS reception. Ukraine enjoys ex-perience with developing satellite naviga-tion systems, along with the USA(NAVSTAR) and Russia (GLONASS). Rus-sia has maintained its GLONASS satelliteconstellation as an alternative to the UnitedStates’ GPS satellite navigation and posi-tioning system. However, development ofthe GLONASS project’s commercial com-ponent has been hampered by the lack of acost effective receiver solution. Here,Ukrainian company Orizon-Navigationbased in Smila, Cherkasy Region, hasclosely and actively cooperated with itsRussian counterparts, doing processor lay-out generation works. But Orizon-Naviga-tion, as is the case with its Russianpartners, does not have the possession ofcurrent-generation production technologyfor its microelectronic circuits, and there-fore cannot compete with more technolog-ically advanced suppliers. Cooperation byUkrainian companies with European part-ners in the planned ‘Galileo’ satellite navi-gation and positioning system of theEuropean Union should not be consideredas a manifestation of direct competitionwith Russian companies, even though Rus-sia does not have an interest in more navi-gation systems to be deployed on orbitalong with its GLONASS constellation. Inthis sense, China has launched a challengeagainst space-faring nations by announc-



ing plans to deploy an indigenous satellitenavigation system, the ‘Beidou’. In its cur-rent configuration, however, the Beidouhas limited application and a coverage lim-ited to the territory of China itself. In re-sponse to this move by China, Japan hasdeclared intention to set up own satellitenavigation system, but there has been noreports to date of Tokyo making any prac-tical implementation measures to this end.

It may be noted in this context thatRussian spacecraft are far inferior to Amer-ican counterparts in operational capabili-ties and lifetime (in sum their quality), andnext-generation Russian satellites are notexpected to equal currently operationalU.S. satellites in performance capabilitiesuntil 2014-2016.

So, the above indicates that Ukraineand Russia are cooperating with and com-plementing each other on the missile andspace services markets, and, to a limiteddegree, are competing with one another onthe space launch market where the PRC isemerging as a viable competitor to Ukraineand Russia

Competition on the rocket andartillery markets

A common competitive disadvantageof Ukrainian and Chinese defense indus-tries (specifically Ukraine’s naval ship-building industry) is the lack of advancedshipboard missile system designs. Navalships are cheaper to build in China than inUkraine or Russia. Asian-Pacific countrieswould build supersize vessels within ashorter timeframe and, often, with a higherquality. Moreover, at the time of economicrecession, they openly resort to pricedumping practices by reducing prices by18-20 percent to get an extra edge overtheir European rivals. Naval ships, combataircraft and armored fighting vehicles are

only considered here as weapons plat-forms. In the Russia-Ukraine-China trian-gle, the unrivaled leader in the field ofmissile weapons is the Russian Federation.Any of the world designers have nevermanaged to develop anything comparablein operational efficiency to the missile sys-tem types created in Russia back in Soviet-era days. The USSR, reciprocally, hadsuccessfully reproduced U.S.-designedanti-ship missiles Tomahawk and Har-poon, under designator names ‘Granat’and Kh-35, respectively. In the anti-shipmissile domain, China only has two in-digenous designs, the C-801 and C-802 (thelatter featuring an air breathing engine),both of which are much inferior to U.S. andRussian equivalents in operational capa-bilities. At the same time, the PRC has longcaught up with Russia in the fields such asartillery and multiple-launch rocket sys-tems. Even though they may not be as ca-pable as Russian or Western-designedalternatives, still their indisputable com-petitive advantage is much lower cost thanthat of rival equivalents. Given that con-ventional artillery systems had reached thelimit of their technological developmentback at the WWII time (with only fire con-trol system being improved in postwaryears), China has, in actual fact, developeda last century’s generation technology. Inthe development of future-generation ar-tillery weapons such as electromagneticguns or liquid projectile weapons, the levelof competition is difficult to evaluate, asthe developments are kept in secret and anoperational prototype is not to be built inthe U.S. until 2025. A quite similar situationcould be observed in the domain of laserweapon systems where the Russian Feder-ation is the only country to have demon-strated successful developments.

The PRC has successfully marketedindigenously-designed highly capable



multiple rocket launchers, while Ukrainehas recently demonstrated an indigenousequivalent whereby an emphasis is obvi-ously placed on operational comfort for thelauncher crew.

A rare manifestation of competition onthe rocket and artillery market was Russia’stransfer of production license for the‘Krasnopol-M’ weapon to the PRC, in a pack-age with 1,000 precision-guided rounds ofthis type. This means to say that more capableUkrainian equivalent ‘Kvitnyk’ (designed byNizhyn’s Central Design and DevelopmentBureau ‘Tochnist’) will never be able to makeit to the Chinese market. Furthermore, ex-pected mass production of precision weaponsin this category at Chinese factories mightthreaten Ukrainian and Russian suppliers onthird-country markets.

The PRC has already advanced aheadof Ukraine in some weapons technologyareas where Ukraine was previously a tech-nology donor. Now Ukraine itself is inter-ested in reverse transfer of some Chinesetechnology required for building an indige-nous tactical/operational missile system de-sign based on advanced and cost effectivematerials and electronic assembly units. ThePRC has also advanced far ahead recently inrobotic engineering and UAV development.

It will therefore be easily understoodthat, in the rocket and artillery market,Ukraine is interested in Chinese and Russ-ian technologies, which would undermineits own position as arms supplier on the onehand, but would simultaneously open newvistas for international collaboration on theother hand.

Competition on thenaval market

China’s selection of Russia as the sup-plier of a few expensive destroyers for thePLA Navy was, to a large degree, moti-

vated by its desire to get access to uniquesupersonic ramjet anti-ship missile‘Moskit’. Russian non-nuclear submarinedesigns, as well, include integrated anti-sub/ship cruise missile systems of the‘Klub’ series. Previously, when the USAwas showing interest in purchasing a ship-ment of Russian anti-ship cruise missiles‘Moskit’ (NATO reporting name SS-N-22‘Sunburn’) in a package with a few attackcraft as carrier platforms, the Russian de-signer of the missile, in an article publishedin ‘Komsomolskaya Pravda’, protested theplanned deal, saying that the USA, with itsvirtually unlimited financial resources andtechnological potentialities, would be ableto use the design as a basis for building anindigenous equivalent capable of mid-course speeds of up to 4.5 km/s. Theplanned deal was scrapped after theprotest. The ‘Moskit’, simple as it may im-mediately seem, is, in actual fact, a highlysophisticated design which China will notbe able to replicate or begin to mass pro-duce in the foreseeable future. On the otherhand, the PRC has already obtained pro-duction licenses for the Kh-35/AS-20‘Kayak’ and Kh-31A/AS-17 ‘Krypton’ anti-ship missiles.

In the field of submarine design andconstruction, Ukraine is no competitor toRussia, as it does not have indigenous de-signs in this domain, neither does its Navyhave a substantial enough requirement forsubmarines (it is estimated at 3-9 sub-marines at most). As for China, it has vig-orously worked to develop reverseengineered copies of the Type 877 Var-shavyanka-class non-nuclear submarineand its more recently designed versions,and even has launched the building ofatomic submarines. After taking deliveryof the Varshavyanka in 2002, the Chinesebuilt a replica of the submarine’s hull in2004 and, probably, ‘stuffed’ it with



weapons whose types could not be viewedon overhead images in sufficient resolu-tion. It could be well assumed that it won’tbe long before the PRC would be able tocopy and build the sub’s key systems, aswell. Considering the progress made bythe PRC in microelectronics, radiolocationand hydroacoustics, Beijing may soonbegin supplying naval vessels in all cate-gories (with efficient enough navalweapons packages) to third-country mar-kets where it is going to face a competitionfrom Russia. The PRC has recently deliv-ered the first-of-class F-22P frigate to thePakistan Navy, under a four-vessel$750mn contract awarded in 2004. Navalelectronic equipment on the first F-22Pfrigate is almost entirely made in China.Previously, the PRC was supplying navalships to Thailand and Algeria.

In the field of naval weapons, Ukrainecould cooperate both with the PRC and theRussian Federation. However, cooperationhere might not be of a large scale, as thePRC and Russia both have excessive ship-building capacities. Ukraine has huge po-tentialities and experiences with naval shipdevelopments. Even so, cooperation withRussia or the PRC here is hardly possible,given that the former can do well on itsown without anybody’s help, while the lat-ter, even though it does have a requirementfor naval ship designs, would prefer ob-taining them ‘for free’. Furthermore, it ismost unlikely that any of the two super-powers would openly recognize the needto have Ukrainian design companies en-gaged in their respective naval shipbuild-ing programs.

One more area of common interest forthe three countries could be the completionof the Type 1164 Missile Cruiser ‘Ukrayina’that is currently staying unfinished at the61 Kommunara Shipbuilding Yard inMykolayiv. Both Russia and the PRC ever

and again express an interest in a ship ofthat class. For China, however, acquiringthat type of a ship would be highly prob-lematic, given that the cruiser’s weaponscomplement includes 16 anti-ship cruisemissiles capable of ranges in excess of 500kilometers – a prospect that would cer-tainly raise protests from the U.S., Taiwanand Japan. Russia, despite its rapidlygrowing geopolitical ambitions, is afraid toassume extra financial burdens for thecompletion and subsequent operation andmaintenance of that large ship. With regret,we point out here that the suggestionsbeing voiced for the unfinished cruiser tobe employed as a seaborne anti-ballisticmissile launch platform are almost as real-istic as creating a human settlement onMars.

In the field of ship repairs, Ukraineenjoys some advantages over Russia, inthat Ukraine supplies propulsion systemsfor most of ex-Soviet naval ship designs,and, furthermore, the cost of ship repairservices is cheaper in Ukraine. The PRChas seriously considered having its Type956 destroyers repaired at Ukrainian yards.As well as ship repairs, Ukraine has anedge over Russia in the naval ship upgrad-ing market, as well, most particularly withrespect to gas-turbine engines which Rus-sia does not manufacture thus far (navalgas-turbine manufacturing facilities beingunder construction in Russia will not beable to offer competitive products duringthe mid-term period).

Research and Manufacturing GasTurbine Corporation Zoria-Mashproekt,earlier in 2009, was awarded a Chinesecontract to supply four naval gas-turbineengines worth $55mn, in addition to threelarge-scale orders from the Russian Navy.

It is worth of note that Ukrainian shiprepair yards in Sevastopol (which havecurrently been employed as leased prop-



erty by the Russian Black Sea Fleet, undera lease agreement expiring in 2017) are op-erating at 100pct of capacity and providedwith sustained business through the leaseperiod. As a result of ongoing fight forproperty rights in Ukraine, a number ofship repair plants have been in deep col-lapse, all the blame for their problemsbeing fixed on ‘ineffective management’.

Therefore, in the naval shipbuildingarea, Ukraine has the possession of power-ful design and development capacities. Atthe same time, Ukrainian naval shipbuild-ing yards cannot hope for export contracts,at least pending successful completion of aprogram to build four corvettes to meet theUkrainian Navy requirement. The RussianFederation and the PRC both have the pos-session of substantial shipbuilding capaci-ties, providing a direct competition toUkraine on third-country markets. In ab-sence of indigenous naval weapons de-signs, Ukraine has to engage with foreigncountries. Here, Chinese weapons arecheaper, whereas Russian weapons aremore advanced and of higher quality, evenagainst the backdrop of Western counter-parts. On the naval market, Ukraine’ maincompetitive advantages over Russia orChina are its gas turbine engine develop-ment and production capacities (which arefar more advanced than those in Russia orthe PRC) and the capability to providemodestly-priced high-quality repair andmaintenance services.

Competition on the airdefense market

Comparing with the naval market, sit-uation is pretty different for Ukraine on theair defense market. For one thing, Russiaenjoys pre-eminence on that market. Sec-ond, Ukraine cannot offer competitiveenough current-generation designs. Its air

defense modernization and improvementprograms are restricted to a limited up-grade of technically obsolescent and worn-out short range mobile SAM systemsOSA/SA-8 ‘Gecko’ and, more rcently de-signed, self-propelled medium-range SAMsystems of the BUK series, as well as re-pairs on long-range S-300-series SAM sys-tems. The sales (including replacementparts) and repairs of soon-to-be-phased-out SAM systems S-75/SA-2 ‘Guideline’and S-125/SA-3 ‘Goa’ could be safely neg-lected. A project to launch overall repairsof S-300-series SAM systems on the prem-ises of Kiev’s Repair Plant ‘Radian’ provedto be a total failure, while the State Enter-prise ‘Generator Plant’ (who was to bemade responsible for upgrading transmit-ter-receiver subsystems for the S-300) hascurrently been undergoing bankruptcyproceedings.

To date, the Russian Federation hasexported a total of 40 S-300-series SAM fireunits to the PRC. In addition, Russia has as-sisted China in developing a copy of its S-300PMU-1 SAM design under Chinesecode name HQ-9, along with its simplifiedversion FT-2000. Previously, Chinalaunched full-rate series production of theHQ-2-type SAM system (indigenousreplica of the S-75). It is worth of note herethat the PRC was purchasing SAM weaponsystems from Western suppliers until itcame under international arms embargo in1989.

Ukraine has since 1993 persistentlyproposed that Russia should assist in up-grading to modern standards and extend-ing operational life of the UAF’s SAMweapons inventory. To date, agreementshave been reached with Russia on a verylimited number а projects. In 2003, a jointproject was completed to extend opera-tional life of the UAF’s 5V55R and S-300PSAM system inventories from 10 to 15



years. The core of Ukraine’s surface-to-airmissile shield is comprised by Soviet-eraS-300PT and S-300PS SAM systems manu-factured back in the mid-1990s and pro-viding effective engagement ranges limitedto 75 km. Newer and more capable S-300-series versions had never reached Ukraine,unlike China whom Russia was supplyingwith the S-300PMU-1 and S-300PMU-2configurations. The HQ-9 SAM system(Chinese copy of the S-300), which can de-feat targets at ranges in excess of 100 km,employs a Chinese indigenous guidedSAM missile derived from theSoviet/Russian-developed 5V55. The HQ-9, which is operationally deployed with thePLA Air Defense Force, is currently com-peting in a Turkish long-range SAM tenderalong with Russia’s S-400 and the UnitedState’s Patriot.

Most of 36D6/’Tin Shield’ radar sys-tems (that provide target identificationand battle management for S-300-seriesbatteries) have been supplied by Ukrain-ian company, the Research and Produc-tion Corporation ‘Iskra’ in Zaporizhzhia.In such a case, Russia does not even try todevelop a more or less comparable in-digenous design in the same category. Itwould therefore be safe to say thatUkrainian and Russian suppliers are com-plementing each other on the S-300-series SAM market.

An upgrade package for the ‘BUK’SAM system was developed to improvesubstantially its operational capabilitiesby enhancing the high-frequency compo-nent of its transmitter-receiver unit. Bythe time the upgrade was to be launched,China had established production of anindigenous copy of the BUK, along with amissile equivalent to the 9M317. There-fore, there is no reason to expect China’spurchasing SAM systems BUK or itsnaval variants ‘Uragan’ or ‘Shtil’.

The PRC has developed and is offer-ing potential export customers a range ofindigenous medium-range SAM systemsderived from the Western designs obtainedprior to 1989 when it came under an inter-national arms embargo. Using some West-ern and ex-Soviet SAM designs as a basis,the PRC has developed indigenous short-range SAM systems HQ-7 and HQ-61A, inaddition to other air defense weaponswhich it has aggressively promoted on ex-port markets. The HQ-7 design was sold toIran where it was successfully reproducedafterwards.

It could be said with a high degree ofcertainty that it is China who is going toprovide the toughest competition to Rus-sia on the long-range SAM markets wherethe supply of U.S. ‘Patriot’ SAM systems isimpossible for political reasons. In themedium and long term, China might be ofinterest to Ukraine as a potential coopera-tion partner in bringing up to modern stan-dards UAF’s SAM assets, most particularlyin the aspects where real alternatives toRussian proposals might be required.

The State Enterprise ‘Arsenal Fac-tory’ in Kiev was onetime designer ofseeker heads for the ‘Igla’-series man-portable SAM systems, and it still offersits most advanced developments. At thesame time, Russia has developed indige-nous capabilities for the design, develop-ment and mass manufacture oftechnologies in this category. The PRChas, since the 1970s, persistently workedto develop and mass produce indigenouscopies of the ‘Strela-2’ and ‘Igla-1’portable SAM systems, and it even beganequipping them with more advancedguidance units of indigenously designand make. Today, China itself offers theexport market indigenous SAM systemsQW-1, QW-2 and NH-5 (the QW-2 has al-ready been exported to Bangladesh).



In the field of air defense artillery,Ukraine is not in a position to competewith Russia or the PRC, as each of the threecountries have arsenals of pretty advancedyet unsophisticated and cost effective airdefense guns. From-scratch developmentof an artillery system with a caliber below76.2mm is widely considered to be eco-nomically unfeasible.

Therefore, in the Ukraine-Russia-China triangle, technological leadership inSAM weapons niche markets belongs toRussia who has until recently been activelysupplying its most advanced SAM designsto China. Simultaneously, China has estab-lished acceptable quality indigenous pro-duction of almost the entire range of SAMsystems, from heavy long-range systems toman-portable SAM launchers. The PRChas experienced some difficulties with es-tablishing indigenous production of S-300-series systems, still it is unlikely to procuremore such weapons from Russia. Instead,further supplies of more current-genera-tion configuration, the S-400, are possible.In such a case, Russia will try not to trans-fer its newest technologies to the PRC untilsubsequent-generation designs are inplace. Ukraine’s capabilities in this field arelimited to repairs of SAM systems for theUkrainian Air Force and potential exportcustomers, and upgrades of technically ob-solescent SAM designs for third-countrymarkets.

Competition on the tank andlight armored fighting vehicle(AFV) market

In the tank and AFV area, pretty com-plex relationships have been developingbetween Russia, Ukraine and the PRC.Ukraine and the Russian Federation bothhave entire clusters of tank and lighterAFV makers who enter into direct compe-

tition with each other on all markets, in-cluding the PRC and regional markets. Itmight be noted here that Ukraine had ob-tained a fully self-sufficient tank/AFV in-dustry after Russia refused to assist inexecuting a large-scale tank contract fromthe Pakistan Army. As a result, Ukraine in-dependently developed deficient tankguns and a range of explosive reactivearmor (ERA) designs (when asked to sup-ply ERA systems to support the Pakistanicontract, Russia charged a price almostequivalent to 10pct of the entire cost of thecontract). Eventually it turned out thatUkrainian company ‘Microtech’ Base Cen-ter for Critical Technologies in Kiev, whoundertook to develop ERA solutions to alltypes of anti-tank threats, has outpacedhere its key competitor, the NII STALI (Sci-entific Research Institute of Steel) inMoscow. The PRC has successfully estab-lished indigenous manufacture of ERA sys-tems and integrated them with the PLAArmy tank fleets. The ERA designs devel-oped in Russia, Ukraine and the PRC allhave comparable specifications and pricetags, but their operational capabilities can-not be compared other than in a ‘combat test’.

A similar situation could be ob-served in the fields of active protectionsystems and electronic warfare equip-ment. It’s only reasonable that each of thecountries gives preference to indigenousdesigns when selecting active protectionand electronic warfare system designs tomeet requirements of their respective mil-itary forces.

Therefore, in the domain of tank andlighter AFV protection, the three coun-tries have comparable capacities andcompete with each other, with Ukrainehaving a slight edge over the other two.In this niche market, Ukraine could havesuccess on third-country markets, includ-ing in cooperation with its competitors.



The PRC launched indigenous manu-facture of main battle tanks back in the late1960s when, in March 1969, during anarmed clash between the PRC and the So-viet Union along the Ussuri River onDamansky Island, the Chinese troops cap-tured a Soviet T-62 tank. The tank wascarefully examined by Chinese engineersand some of its components were copiedand integrated into indigenous designs.This suggests that the PLA Army currentlyhas in service a great deal of technically ob-solescent armored vehicles. In the mean-while, China has been procuringnew-generation tanks in limited amounts,probably for reverse engineering purposes.The Chinese tank Type 90/MBT-2000, de-veloped from the Soviet-vintage T-72, hadwon against Russian (T-90) and Ukrainiancounterparts in a contract competition toprovide a tank fleet for the Pakistan Army,and it has now been successfully exportedto Pakistan as Al Khalid. The Al Khalidtank is equipped with the Ukrainian poly-diesel 6TD, which Pakistan had preferredover a Russian gas-turbine motor. So,Ukrainian tank/AFV engines may hold thepromise of significant orders, most partic-ularly when the Morozov Design and De-velopment Bureau built a new, morepowerful engine.

In February 2009, Ukrainian tankmakers announced that 62 engine/trans-mission packs for Al Khalids would havebeen delivered to Pakistan before the endof September, along with an initial ship-ment of engine and gear boxes for special-application vehicles. In 2008 alone,Pakistan awarded Ukrainian companies$2.5mn worth of contracts for supplies ofreplacement parts for purpose-built vehi-cles.

Ukrainian tank designers have cur-rently been actively engaged with Chinesecounterparts on a range of joint R&D proj-

ects, whereas Russians have closely coop-erated with China in the development ofcontrol systems.

Russia and Ukraine are both equippingtheir tanks with French-supplied infrared im-aging cameras, while having own develop-ment and manufacturing capacities fortechnologies of this kind (Ural Optical Me-chanical Plant (Yekaterinburg, Russia) andNPK Photoprybor (Cherkasy, Ukraine),which are competing with one another onthird-country markets). Unlike Russian andUkrainian counterparts, tank and AFV mak-ers in China do not have the ability so far toemploy advanced Western technologies forintegration into own AFV designs, which re-duces their competitive capacity on the exportmarket. It would be worth of note, however,that the United States and NATO have im-posed limitations on exports of latest-genera-tion night vision equipment, which areapplicable to all potential customers.

Meanwhile, fierce competition has beenobserved between Russia, Ukraine and Chinaon the oversaturated export market for lightarmored fighting vehicles. To date, this com-petition is largely restricted to the design, de-velopment and marketing of new-generationweapons stations. Here, all the three countriesoffer designs with roughly comparable spec-ifications and operational capabilities. For thisreason, any contract award to Russia, Ukraineor China involving the supply of AFVs, ar-mored personnel carriers (APCs) or armoredvehicles should be considered as one-time-only contract. The Russian Federation, for in-stance, has delivered a small shipment of onehundred new armored GAZ-2330 TIGR ve-hicles to the PRC, while Ukrainian manufac-turers have not yet found large enoughmarkets for their light armored vehicle de-signs. Even so, Ukrainian products such asthe newly-designed BTR-4 or upgraded BTR-3E hold much promise with respect to exportopportunities.



Tough competition between the threecountries has been observed on the marketfor antitank weapons, as well. Arms factoriesin Russian Tula have traditionally enjoyedpre-eminent position here, followed byUkrainian company Design and Develop-ment Bureau ‘Luch’ who offers potential cus-tomers its advanced designs such as the‘Stugna’, ‘Kombat’, ‘Skif’ and ‘Baryer’ anti-tank guided weapon (ATGW) systems. As forthe PRC, it has long established indigenousproduction of most of antitank weaponstypes.

Therefore, in the field of tanks and ar-mored fighting vehicles, Russia, Ukraine andthe PRC each enjoy comparably robust posi-tions on third-country markets. On the onehand, they are competitors to one another. Onthe other hand, Ukrainian engine systems forMBT applications have a number of advan-tages over rival designs, and may thereforehold the promise of further significant orders.The PRC does not appear to be in a rush toprocure large enough shipments of current-generation tanks to meet the PLA Army re-quirement. All the three countries are directlycompeting with each other on third-countrymarkets. Here, the PRC enjoys traditionallyrobust position on Asian-Pacific markets,while Ukrainian and Russian tank and AFVsuppliers have roughly equal export oppor-tunities. In the niche market for light armoredvehicles, standing of each of the three coun-tries is relatively weak comparing to that ofWestern suppliers, and they therefore canonly hope for occasional contracts.

Competition on the aircraftmarket

Ukrainian designers enjoy a prettystable position on the aircraft market,which is the most capital-intensive marketsegment. Here, Ukrainian companies(OJSC Motor-Sich and ZMBK Ivchenko-

Progress Design and Development Bureau)provide aero engines for the Russian-builtaircraft supplied to the PRC.

Furthermore, a number of Ukrainiancompanies complement Russian counter-parts supplying end products; State Enter-prise ‘Krasyliv Assembly ManufacturingPlant’, JSC ‘Phasotron-Ukraine’, OJSC‘Corporation FED’ and more defense com-panies in Ukraine provide some key com-ponents and subsystems forRussian-supplied MiG-29 and Su-27 fighteraircraft. These include coherent radar sys-tems, communications facilities, navigationaids, bomb release systems and other in-dispensable subsystems of the combat air-craft.

The Mi-8, Mi-17 and Kamov-serieshelicopters supplied by Russia to exportcustomers are all equipped with Ukrain-ian-made engines, each accounting forabout 20pct of the aircraft’s value. In sucha case, warranty and post-warranty servic-ing of the engines is provided by the en-gine supplier.

A characteristic of aeronautical coop-eration within the Russia-Ukraine-PRC tri-angle is that the three countries are activelyand closely cooperating in the engineeringfield, with Russia and Ukraine typicallytransferring selected technologies to Chinaand the latter providing financial supportfor selected R&D projects of interest to it-self.

ZMBK Ivchenko-Progress offers co-operation in developing an engine for aprojected Chinese indigenous civiliantransport aircraft. Furthermore, in May2009, the Shenyang Aircraft Engine Plantproposed that ZMBK Ivchenko-Progressshould carry out expert evaluation of its12+ ton thrust aeroengine project. In the ro-torcraft engine field, ZMBK Ivchenko-Progress offers the Chinese party itsAI136T1 engine, an enhanced, more pow-



erful version of the D136 engine for theMi-26 helicopters that the PRC purchasedfrom Russia recently. Also, China mighthave an interest in equipping its Russian-supplied Mi-46 helicopters with theAI8000V engine (a derivative of the AI-222K-25F engine for fixed-wing aircraft),and the same engine type might workwell with the heavy payload transportaircraft being currently developed byChina.

ANTK Antonov Aeronautical Scien-tific/Technical Corporation has beenclosely engaged with its Chinese counter-parts, assisting in the development of theY-H7/Y-14-100 aircraft (Chinese copy ofthe An-26).

In the late 1990s/early 2000s, the PRCtook delivery of a large quantity of Russ-ian-supplied Su-27 and Su-30MK fighteraircraft, and bought respective productionlicenses. Many of repair technologies forthe aircraft and relating engines werebought by China from Ukraine, and it wasUkraine where Chinese engineers andtechnicians had been taught how to do re-pairs on the equipment. It is not impossi-ble that Ukraine might get interested soonin China as a partner in aircraft upgradeprograms.

The PRC has launched license pro-duction of the Su-27, under own designa-tion Shenyang J-11. Engines appeared tobe not among the Chinese aircraft indus-try’s strong points. But this is not the casenow; China has already demonstrated adomestically designed alternative to theRussian AL-31F jet engine it has beenbuying to date as primary power plant forthe Shenyang J-11. A technological break-through achieved by China in the aircraftengine area has allowed for the propor-tion of Chinese-made components andtechnologies to be increased from 70-75percent to 90 percent or even higher.

An example of multidirectional na-ture of Ukrainian-Sino cooperation in mil-itary technology might be a deal on thedesign, development and type certificationof the AI-222K-25F engine for the HongduL-15 Falcon supersonic fighter trainer,which also calls for the transfer of produc-tion license for the engine. ZMBKIvchenko-Progress would supply two pre-production units of the AI-222K-25F engineto Hongdu Aviation Industry Group(HAIG). An appropriate contract wassigned during the 13th edition of BeijingInternational Air Show in October 2009.According to the terms of the contract, theUkrainian partner will have to design, de-velop, fly test and type certify the AI-222K-25F afterburning turbofan for HIAG.

China is determined to aggressivelypromote the Chengdu Aircraft IndustryCorporation FC-1/JF-17 and J-10 fighteraircraft on potential export markets. TheJF-17 fighter, (otherwise known as FC-1),which was developed in a joint programwith Pakistan, has already entered servicewith the PLAAF and Pakistan Air Force.According to a high-ranking Chinese de-fense industry official, the JF-17 has beenselected as a top-priority project for exten-sive demonstration on the export market.The Pakistan Air Force alone has the re-quirement for up to 300 aircraft in this cat-egory to replace its legacy fleets of Chineseand French-supplied fighters.

Earlier in 2009, China revived its ef-fort to build a C-130J class transport. TheChinese Y-9 is a 77 ton indigenously de-signed aircraft that is back in development.The Y-9 is basically a stretched version ofthe 61 ton Y-8F-200, which is, in turn, a Chi-nese copy, and upgrade, of the Russiantransport aircraft An-12. China wants to re-duce its dependence on Russia for trans-port aircraft, and has noted the success ofthe latest version of the C-130, the C-130J.



Ukraine has supplied 953 (1,500 ac-cording to alternative sources) R-27/AA-10 ‘Alamo’ medium-range airbornemissiles, and Russia supplied 1,200 R-73/AA-11 ‘Archer’ short-range air-to-airmissiles to China. In such a case, Ukrainianmissile producers were supplying theirmissiles directly to China to support Russ-ian fighter aircraft supply contracts -- com-plementing Russian missile suppliers andwithout entering into competition withthem.

As seen from the above, Russia willnot be able to maintain the current highlevel of aircraft exports to China in the fu-ture, as China itself is evolving into a viableplayer of the global aeronautical market.Given the difficulties being experienced byRussia with its fifth-generation jet fighterproject, China is set to oust Russia fromthird-country markets in the mid-term, andmay eventually develop into the world-wide leader in the aeronautical industry.Here, selection of aeronautical supplierswill, to a large degree, be determined bypolitical considerations and preferences.Therefore, Ukrainian companies will, for acertain limited period of time, be able tocontinue with direct supplies of missileweapons and subcontracted supplies sup-porting Russian contracts with third coun-tries.

ConclusionsIn view of almost total absence of fully

integrated system supplies under military-technical cooperation programs betweenUkraine and Russia, the Ukraine-Russia-China triangle has been progressively re-configured into a pyramid, with China at thetop and Ukraine and Russia a the base of thepyramid. In such a case, China is financialdonor of selected new developments, whilethe Russian Federation and Ukraine act asdonors of technology and designs.

Ukraine and Russia are competingover Chinese contracts for limited suppliesof relatively high-tech weapons and de-fense equipment types. These usually in-volve transfers of technologies,engineering documentation, manuals andproduction licenses. China has already suc-ceeded in launching indigenous produc-tion of most of previously deficienttechnologies, and it will therefore becomeincreasingly independent of Russia orUkraine as technology donors.

Continuing mutually beneficial coop-eration with the PRC is possible in the fieldof engineering. China is keen to invest ininnovative technology developments andsetting up research-and-technology parksin Ukraine.

On the space services market, Ukrainehas most robust position in relation to Rus-sia and the PRC in the niche market forspace launch services. The PRC is keen tofurther expand its indigenous satellite nav-igation and positioning system, while Rus-sia and Ukraine are both interested inreverse transfer of Chinese microelectronictechnology.

On the aeronautical market, aircraftdesign companies in Ukraine and Russiamight expect joint projects and co-devel-opment contracts with, as well as a certainamount of investment from China. In sucha case, there is a certain degree of directcompetition being observed between air-craft design and development companiesin Ukraine and Russia.

On the markets for naval, aircraft,tank and AFV engines, Ukrainian suppli-ers are supporting export contracts for re-spective host platforms, and are thereforeinterested in increasing supplies of navalships, aircraft, tanks and AFVs within theUkraine-Russia-China triangle.

Russia and Ukraine are worldwideleaders in the tank building industry.



China does not seem to have any intent ofprocuring large amounts of current-gener-ation tanks, but instead is keen to sell itsearlier-generation fleets to third-countrymarkets. In the field of tank engines,Ukrainian diesels have an edge over Russ-ian gas-turbine counterparts.

In the field of naval shipbuilding, thePRC has been progressively and persist-ently developing its indigenous capacitiesfor building naval ships in all categories upto and including aircraft carriers, seeking aworldwide ocean presence. In such a case,China apparently lacks adequate knowl-edge and experience. At the same time,shipbuilding yards in Ukraine and Russiahave been severely underutilized (not in asmall part because of legislation where avessel registration/license costs up to 40pctof the cost of the vessel itself). For this rea-son, it is more beneficial for a customer tohave a vessel design developed in Ukraine(as does Turkey), then to build the vesselhull indigenously, and, afterwards, get thevessel finished and furnished at shipyardsin Europe. Alternatively, a vessel could be

entirely built and furnished at a shipyardin an Asian-Pacific country and subse-quently registered as a Cyprus ship.

In the field of electronic warfare andcommunications equipment, the PRC hasalready achieved a certain degree of self-sufficiency, to the extent that it can nowoffer indigenous products to export mar-kets. Almost only exceptions here are mostlatest radar designs and combat informa-tion and control systems, which both re-quire sophisticated mathematical toolstechniques to be developed and built.

In the fields of air defense weapons,conventional artillery and multiple rocketlaunchers, Russia has already saturated theChinese market with new technology, to theextent where Ukraine, under suitable con-ditions, might contract with China for re-verse transfer of technology required forindigenous development of a multi-rolemissile system and SAM system. Also,Ukraine might be interested in China as apotential partner in repairs and upgradingof earlier defense technologies.



he Chinese economy targetsthe export market, its exportorientation showing a continu-ous trend of growth. In 2008,for example, China was the

world’s second largest exporter, with ex-ports amounting to 1.43 trillion US dollars.

Even though China ranks second inthe world in GDP terms behind the USA(according to IMF data, China’s GDP raninto 7.916 trillion in the international dol-lar equivalent in 2008), its export-driveneconomy — with exports accounting for 80percent of the State foreign-exchange rev-enue and the export-targeted industriesemploying a combined workforce of about20 million — makes the PRC highly de-pendant on export markets. Some 20 per-cent of China’s gross industrial output andagricultural produce is geared to exports,the export Nomenclature comprising about50,000 products.

The PRC has maintained trade andeconomic relationships with 182 countriesand regions of the world, of which 80 havegovernment-to-go-vernment trade agree-ments or protocols signed with China.PRC’s key trade partners include advancedand developed capitalist countries, mostnotably the USA, Japan and Western Eu-rope, which all provide a combined 55 per-cent of China’s foreign trade turnover.China’s best selling product portfolio is stillmade up of footwear, garments and toys,yet the exports of electronic equipment, bi-cycles, motorcycles and motor vehicles, as

well as transport vehicles and constructionmachinery have all shown a strong up-ward trend in recent years, as well. Simul-taneously, China, who has vigorouslyworked to re-equip and re-weapon itsarmed forces with advanced current-gen-eration arms and military hardware types,is keen to expand its presence on defenseexport markets, most notably in emergingcountries in Africa and the Middle East.

Meanwhile, China’s standing on theglobal defense market is pretty unique, thisbeing explained by a number of logicallyinterrelating factors.

1. China has since 1989 been in aquasi-blockade situation. FollowingTiananmen Square massacre of 1989, Euro-pean countries, in June 1989, imposed anembargo on arms supplies to the PRC.After the end of the Cold War era, the USA,as well, became the natural opponent ofadvanced arms and military technology ex-ports to the PRC. The issue of the embargolift was raised several times during 2004-06, still it has remained in place to date.This situation resulted in Russia having be-come the key and almost the sole source ofadvanced weapons and military hardwaredesigns for China, this circumstance se-verely impeding the effort being made bythe PRC to obtain most advanced systemsand technology. As consequence, the influxof new current-generation technology intoChina has been limited, and as such it isputting a break on the development of in-digenous designs, thereby restricting


Third chapterThe specifics of China’s policies towards regional markets

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China’s capabilities as exporter of ad-vanced weapons types to developed na-tions, and narrowing its niche markets inemerging countries as well as its traditionalpartner nations.

2. The PRC has directed its effort to-wards establishing and building up ownR&D and manufacturing potentialities,most notably through reverse engineeringof foreign-designed items of equipmentwith the goal of their subsequent ‘domesti-cation’ into indigenous designs. Even at thetime of massive arms and military technol-ogy imports in 1950-62 and 1992-2005, thePRC was keen to establish and further de-velop its capabilities for indigenous pro-duction and subsequent upgrading of theweapons and military equipment typesbeing procured from foreign suppliers. Theresult is that most of Chinese defense ex-ports comprise products that are either re-versed engineered copies or officiallylicensed replicas of foreign designs, mak-ing China a viable competitor on the de-fense export market, and particularly sowith respect to countries of origin of Par-ent designs.

3. The Chinese defense export hasbeen notable for clearly observable cyclic-ity, this stemming from specific ap-proaches being applied to the developmentof indigenous arms and military technol-ogy designs through reverse engineering.Periods of defense procurements, followedby technological breakthroughs achieveddue to the influx of new advanced technol-ogy, take turns with periods of ‘domestica-tion’ where foreign designs are repackagedas Chinese and as such are subsequentlymass exported to third countries. An ex-ample of such cyclicity might be massivedefense imports during the 1950s (1950-1962) and the transition to massive defenseexports seen in the 1980s. Considering thesecond wave of defense imports observed

during 1992-2005, on which basis the PRChas set up the capability for the domesticproduction of reverse engineered designsand the development of indigenousthird/forth-generation designs, theremight be an expectation of the PRC return-ing to the status of major defense exporterin the foreseeable future, thus adding to ri-valry on that highly competition sensitivemarket.

4. Products offered by China on theglobal defense market, being reverse engi-neered copies of previously procured for-eign designs, are all relatively low-tech,hence unsophisticated and cheap products,due to which China was present, if notdominated on defense markets in Egypt,Pakistan, Bangladesh, Thailand, Sri Lankaand Tropical Africa.

Nonetheless, China, due to its rapidlygrowing industrial and scientific researchpotentialities, political weight and militarymight, has been expanding its influence asa defense exporter with its own stable cus-tomer base and niche markets. When ana-lyzing China’s standing on regionalmarkets, it is worth of note that the PRC,having been under an embargo and, si-multaneously, being a permanent memberof the UN Security Council at that and,also, a member of the elite club of ‘grand’nations, feels itself free to supply arms anddefense equipment to the markets causingsome degree of concern for other defensesuppliers. Specifically, major recipients ofChinese defense products were Iran andIraq at the time when the two were warringagainst one another in 1980-88, in additionto such countries of concern as Sudan andVenezuela.

In the context of China’s standing andperformance on regional markets, we feelit necessary to cite here some data from areport by Stockholm International PeaceResearch Institute (SIPRI). It follows from



the SIPRI report that, in the period from2000 to 2008, China was supplyingweapons and defense equipment to Alge-ria, Argentina, Bangladesh, Cambodia,Chad, the Congo, Egypt, Gabon, Ghana,Indonesia, Iran, Jordan, Kenya, Kuwait,Mali, Mauritania, Myanmar, Namibia,Nepal, Niger, Nigeria, Oman, Pakistan,Rwanda, Saudi Arabia, Sierra Leone, SriLanka, Sudan, Tanzania, Thailand,Uganda, Venezuela, Zambia and Zim-babwe. In the very same period of time,according to the same SIPRI report,Ukraine, was supplying defense equip-ment to some of the above listed countriesamong other markets. This is about Alge-ria, Chad, the Congo, Egypt, Iran, JordanKenya, Myanmar, Namibia, Nepal, Nige-ria, Pakistan, Sri Lanka, Sudan, Thailand,Uganda, Zambia and Zimbabwe.

As seen from the SPRI report, the con-tent of Ukrainian and Chinese defense sup-

plies to the above markets was different. InAlgeria’s case, for example, Ukrainian sup-plies mostly consisted of fully-integratedweapons systems, whereas China was sup-plying components and subsystems for in-tegration with Algerian-built corvettesDjebel Chenoua FAC. Similar situationscan be seen on other markets (see the tablebelow).

Based on the data as presented inTable 1, a number of general tendenciesmight be singled out.

1 Ukraine acted as supplier of compo-nents and subsystems for China-built itemsof defense equipment. This is most notablyabout AI-25/DV-2 turbofans for China-sup-plied K-8 Karakorum combat capable traineraircraft. Each and all of the recipient countriesof the K-8 Karakorum trainer aircraft were re-cipients of the turbofan engines as well.

2 The PRC acted independently ofUkraine as component and subsystem sup-


Recipient country Ukraine China

Algeria

AI-25/DV-2 engines forCzech-supplied L-39trainer aircraft;Mi-24V/Mi-35/Hind-Ecombat helicopters;R-27/AA-10 AlamoBVRAAMR-73/AA-11 ArcherBVRAAM R-40/AA-6 AcridBVRAAM;T-72 battle tanks

Components and subsystems for in-tegration with Algerian-built DjebelChenoua FAC

Chad

Mi-24V/Mi-35, Mi-8/Mi-17 helicopters;Su-25/Frogfoot-A groundattack aircraft;BTR-80 APC

ZFB-05 APC/ISV

CongoMi-24P/Mi-35P/Hind-Fcombat helicopters

ZFB-05 APC/ISV

Table 1

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EgyptAn-74/Coaler-B transportaircraft

K-8 Karakorum-8 trainer/combat air-craft assembled from kits in Egypt

IranAn-74/Coaler-B Transportaircraft (1998-2002 con-tracts

Components and subsystems forweapons systems assembled/pro-duced in Iran

JordanAn-32/Cline Transport air-craft

W-86 120MM Mortar

KenyaBM-21 Grad 122mm MRLT-72M1 MBT

Y-12 transport aircraftWZ-551 APC

Myanmar

R-27/AA-10 AlamoBVRAAMT-72 MBTBTR-3U Guardian IFVMT-LB APC

Components and subsystems fornaval ships built in Myanmar

Namibia

AI-25/DV-2 Turbofan en-gines for China-suppliedK-8 Karakorumtrainer/combat aircraft

K-8 Karakorum-8 trainer/combat air-craftF-7MG Fighter aircraft

Nepal Mi-8/Mi-17/Hip-H heli-copters

MA-60 transport aircraftWZ-551 APC

NigeriaBTR-3U Guardian IFVMi-24V/Mi-35/Hind-ECombat helicopters

F-7M Airguard Fighter aircraftPL-9 SRAAM for F-7N1 combat air-craft

Pakistan

Components and subsys-tems, particularly dieselengines for Al-Zarrar,MBT-2000 and Al KhalidtanksIl-78M/Midastanker/transport aircraft

Type-59-1 130mm and В-33 120mmtowed gunsF-7MG fighter aircraftJ-10/FC-20 FGA aircraft (contract maynot yet signed)A-5C Fantan FGA aircraftNaval weapons and subsystems (in-cluding C-802/CSS-N-8 anti-ship mis-siles, Type-347G fire control radars,C-803 anti-ship missiles and R-440 Cro-tale SAMs) for Jalalat FAC and Jiang-wei (F-22P) frigates built in PakistanYLC-2 air surveillance radarsPL-12/SD-10 BVRAAM for JF-17 andpossibly modernized Mirage-3/5 com-bat aircraft (contract may not yetsigned)KJ-200 AEW&C aircraft built aroundthe Y-8 (delivery from 2010)

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plier; it did not directly supply compo-nents or weapons subsystems for any ofUkrainian-supplied items of defenseequipment (though, it is not fully clearwhether Chinese-made components werepresent or not in Ukrainian-supplied itemsof defense equipment).

3 Weapons and items of defenseequipment supplied by China to the abovemarkets were all reverse engineered copiesof Ukrainian designs. As one example,

China is going to supply Pakistan with KJ-200 AEW&C aircraft ordered for deliverybeginning in 2010. The KJ-200 is designedaround the Y-8 military transport aircraft,itself a licensed copy of the Ukrainian-de-signed Antonov An-12. Furthermore,Nepal exported from China the M-60 tur-boprop 60-seat airliner that was builtaround the Y-7, again, a licensed replica ofthe Ukrainian An-24. This tendency mightharbor the risk of China eventually seizing



Sri Lanka

AI-25/DV-2 turbofan en-gines for China-suppliedK-8 Karakorumtrainer/combat aircraftMi-24P/Mi-35P/Hind-Fcombat helicoptersMiG-27K/Flogger-J FGAaircraft

Type-062/Shanghai patrol craftBT-6/CJ-6 trainer aircraft

Sudan

AI-25/DV-2 turbofan en-gines for China-suppliedK-8 Karakorumtrainer/combat aircraft

Type-85-IIM tanksA-5C Fantan FGA aircraftWZ-551 APCK-8 Karakorum-8 trainer/combat air-craftFN-6 portable SAMs

ThailandBTR-3U Guardian IFV Pattani-class frigates

C-801/CSS-N-4/Sardine and C-802/CSS-N-8 anti-ship missiles

UgandaBMP-2 IFVsMiG-21bis/Fishbed-Nfighter aircraft

Y-12 transport aircraft

Zambia

AI-25/DV-2 turbofan en-gines for China-suppliedK-8 Karakorumtrainer/combat aircraftBTR-70 APC

K-8 Karakorum-8 trainer/combat air-craftMA-60 and Y-12 transport aircraft

Zimbabwe

AI-25/DV-2 turbofan en-gines for China-suppliedK-8 Karakorumtrainer/combat aircraftAn-12/Cub transport air-craft

K-8 Karakorum-8trainer/combat aircraft

39


some niche markets that previously be-longed to Ukraine, by supplying Ukrain-ian-designed products repackaged asChinese or license assembled in China. Thesame pattern might be expected with re-spect to the ‘Zubr’-class landing craft aircushion vehicle, if production of the designwas launched in China under a Ukrainianlicense.

4 On overlapping markets, the tough-est competition between Ukraine andChina could be observed on niche marketsfor military transport aircraft and armoredfighting vehicles, while the least competi-tion could be seen on markets for helicop-ters (with Ukraine supplying Mi-seriesretired helicopters and China supplyingnone), naval weapons and equipment(Ukraine supplied none whereas Chinawas aggressively promoting its products inthis category), beyond visual range air-to-air missiles (specifically, R-27, R-73 and R-40 missiles which are traditionalcommodities of Ukraine’s export nomen-clature being supplied to China amongother markets) and fighter aircraft (unlikeChina, who was acting far more aggres-sively on this niche market, Ukraine hadthe sole contract to supply MiG-seriesfighters to Uganda).

It would be worth of note now in thiscontext that China was supplying transportaircraft and armored fighting vehicles to themarkets which did not see any of defensesupplies from Ukraine in that period. Oneexample might be Chinese supplies of Y-8(licensed copy of the An-12) and MA-60(built around the Y-7, reciprocally a licensedcopy of the An-24) aircraft to Tanzania andGhana, respectively — the markets that werenot among Ukraine’s defense export desti-nations in the period under review. This factmight be indicative either of latent competi-tion or some division of defense markets be-tween Ukraine and the PRC.

Separate mention should be made ofthe fact that, according o SIPRI, Ukrainewas actively exporting defense products toChina, while the latter was not exportingits defense products to Ukraine. Theremight be two explanations for this situa-tion:

1 Ukraine’s defense market is effec-tively closed to imports, with examples ofrare exceptions being unmanned aerial ve-hicles bought from Israel to meet theUkrainian Army requirement and helicop-ters bought from Eurocopter to meet theEmergencies Ministry’s requirement.Other known occurrences of defense im-ports to Ukraine (Ukraine reported foursuch occurrences to the UN ConventionalWeapons Registry 2008) are more intendedfor re-export purposes and include Soviet-built items of defense equipment.

2 At this stage, China has not yetreached the level of technology allowingfor penetration into the defense market inUkraine who itself has in place tradition-ally strong schools of military design.

At the same time, as seen from theSIPRI report for the 2000-2008 period,Ukraine was actively exporting weapons,defense equipment and related parts andsubsystems to China. A few examples are1,577 R-27/AA-10 Alamo BVR air-to-airmissiles for the SU-27SK and Su-30MK fight-ers (including 953 such missiles suppliedduring 2005-2008, according to the UN Con-ventional Weapons Registry), AI-25/DV-2turbofan engines for Chinese indigenous K-8 Karakorum combat capable trainer aircraft(including 58 engines supplied from 1997 to2004, and 35 supplied during 2005-2008), 2S9120mm self-propelled guns, R-73/AA-11Archer BVRAAMs, Kh-55/AS-15 Kent air-launched cruise missiles, passive electronicmonitoring radar systems ‘Kolchuga’ andDT-59 gas-turbine engines for the Type052B/C Luyang-class destroyers.



Regarding the division of defense mar-kets between Ukraine and China, it might benoted that most of markets for Chinese de-fense products are countries in Asia, theMiddle East, Africa and South America.Also, China once supplied defense equip-ment to Sudan, Venezuela and Iran.

Simultaneously, Ukrainian defenseproducts, even though their markets over-lapped in the above listed countries withthose of China’s, preserved previouslywon marketplaces of their own. Ukrainewas supplying weapons and defenseequipment to ex-Soviet and ex-WarsawPact states as well as Balkan countries, inaddition to the USA and Russia (them-selves the world’s top defense exportersand the markets not seen on the list ofChina’s defense export destinations in theperiod under review) and, furthermore, toAfghanistan and Iraq (in 2006-2008). Thelatter is indicative that Ukraine has been se-lected by the International Anti-TerrorCoalition members, including most partic-ularly the USA, as a supplier of cost-effec-tive yet highly-efficient European-classdefense products.

The SIPRI 2000—2008 report shows thatUkraine was supplying defense commoditiesto 53 countries as compared to 34 for China.

Separately, it might be noted that anycoherent analysis of markets for Chinesedefense products is very difficult to do be-cause of the lack of information providedby China on its defense export supplies.Unlike Ukraine who openly and accuratelydeclares information on its defense sup-plies, China is reluctant to provide the UNConventional Weapons Registry with fullinformation, except for disclosing identitiesof recipient countries and providingweapon descriptions, but not their precisedesignations. With open official informa-tion unavailable, the task of doing theanalysis is very complicated, and most par-

ticularly so with respect to tendencies formarkets narrowing or expanding, or over-lapping market niches shared by Ukraineand China.

So, as seen from the above, Ukraineand China are pretty viable competitors onmarkets for military transport aircraft andarmored fighting vehicles, with futurecompetition on those markets tending togrow further. However, as Ukraine and thePRC have been drawing closer together inareas such as the design, development,production and upgrading of aeronauticaltechnologies, and given successful cooper-ation between the two countries in the tri-national Ukraine-China-Pakistan MBT-2000project to produce the Al Khalid main bat-tle tank for the Pakistan Army, it mightwell be expected that relationships be-tween Ukraine and China will progress inthe direction where the two will comple-ment one another, manufacturing defenseproducts both for their respective domes-tic markets and for third markets as well.

Until this expectation becomes a real-ity, however, China has been manufactur-ing indigenous copies of the UkrainianAntonov family of aircraft, specifically theY-5 Shijiazhuang (reverse engineered Chi-nese copy of the An-2), Y-7 Xian (An-24),Y-8 Shaanxi (An-12), Y-9 Shaanxi (multi-purpose transport, a variant of the Y-8XShaanxi, reciprocally a copy of the An-12),MA-60 Xian (a 60-seat turboprop airlinerbuilt around the Y-7, itself a copy of theAn-24).While manufacturing aircraft ofthese types, China has vigorously workedto add new variants to its family of aircraftdesigned as indigenous copies of Ukrain-ian equivalents; China is currently devel-oping the Y8F-600 version with Ukrainianassistance, and it has signaled an interestin the An-70 military transport, most no-tably with regard to building an indigenoussame-design equivalent. Simultaneously, the



PRC is keen to have foreign-designed aircraftassembled at Chinese factories; in June 2009,China delivered its fist Airbus A320 jet air-liner assembled at the Airbus A320 FamilyFinal Assembly Line (FAL) in Tianjing, thefirst Airbus final assembly line to have beenlaunched outside Europe. The Tianjing FAL isexpected to assemble five A320s in 2009 andfurther 12 in 2010. In addition to this, HarbinAircraft Industry Group Company Limited,one of China’s proven first line suppliers ofaircraft, signed a framework contract withAirbus in February 2009 to jointly producecomposite material parts and components forthe A320 family of aircraft. This and othermoves by China are apparently intended tolend weight to its position on aircraft markets.

As regards armored fighting vehicles(AFVs), situation looks pretty interestingthere. If Ukraine already has a ‘closed loop’AFV-production cycle which it inherited afterthe collapse of the Soviet Union, China’s AFVindustry has been in the early stages of de-velopment. Despite a great progressachieved, the Chinese AFV industry is stilllagging far behind the international qualitystandards, its capabilities at this stage of de-velopment being constrained, confined to re-verse engineering of foreign-designedvehicles. Excepting the Pakistan Army, thetraditional customer for Chinese-built battletanks, Chinese AFV exports have been lim-ited to small shipments supplied to underde-veloped countries. Such a situation offersconsiderable advantages to Ukraine, not onlyin terms of lesser competition, but, also, interms of supplies of the AFV components (in-cluding engine and gear boxes for the Pak-istan Army), which China is not in a positionto manufacture independently thus far.

Unlike heavyweight AFV types, the de-velopment of Chinese light armored infantryfighting vehicles (IFV) has enjoyed a tremen-dous growth. The Chinese portfolio of lightarmored IFV designs has been expanded re-

cently, some variants being Chinese copies offoreign designs. If Ukrainian light armoredIFV supplies were small and not numerous in2000-2008 (Ukraine only supplied its BTR-3armored personnel carriers to Myanmar andNigeria), China was far more successful withits WZ551 and ZSL92 vehicles. Interestinglyenough, some reports have it that China sup-plied a significant shipment of WZ551wheeled armored personnel carriers to Thai-land. Other say that two hundred such vehi-cles had been ordered for delivery, and thatit was after completion of the Thailand con-tract when the Type 85/YW-531H variantbegan to be series manufactured in China tomeet the requirements of the PLA and foreigncustomers (among then Myanmar). The factthat such a considerable shipment of IFVswas supplied to Thailand by China looksvery interesting, especially considering thatUkraine with its BTR-3U1 APC won a 2007tender competition to meet the ThailandArmy requirement for 96 wheeled armoredtroop carriers. The contract award was even-tually postponed until a future date pendingcompletion of investigation into a bribe-tak-ing scandal involving high-level Thailand of-ficials. This fact by itself well illustrates thedegree of competition between Ukraine andthe PRC on that specific niche market, andthis already fierce rivalry is expected to growstill further as time goes by.

Against that background, consideringChina’s capability to ‘domesticate’ previouslyimported technology and items of equipmentinto indigenous designs, and the fact thatChina has been closely engaged with Ukrainein some defense technology areas, most par-ticularly so in aeronautics, a further sharpen-ing of competition between Ukraine andChina might be expected. Therefore, Ukrainemust get itself actively engaged in projectswith China as soon as practicable – on legalclearly defined contractual terms and withlongest possible contract periods.



kraine and the People’s Re-public of China have a richhistory with trading in armsand defense equipment aswell as dual-use items. Mili-

tary-technological cooperation between thetwo countries had at different times em-braced almost all areas of defense technol-ogy — from armored fighting vehicles(AFVs) to precision weapons systems andsophisticated radio-technical equipment.Practices of joint work between Ukraineand China in the defense technology areahave passed several milestones, and vari-ous forms of cooperation have taken shape.Ukrainian-Sino military-technical coopera-tion is notable for the following:

– China, in almost all cases, is the re-cipient of weapons systems, military hard-ware and dual-use goods; bilateralcooperative projects, as well, are held ex-clusively for China, with isolated cases ofjoint defense technology projects carriedout for third countries;

– By the start of 2009, Ukrainian ex-ports of ready-made items or systems toChina had reduced to almost zero, thisbeing explained by China’s policy aimed toensure its requirement for weapons anddefense equipment is to the maximum pos-sible degree fulfilled through domesticproduction. For example, Ukraine had forsome time been one of China’s biggest sup-pliers of guided air to-air missiles; during

2005-06 China bought from Ukraine morethan 900 R-27-series air-launched missiles,in addition to sporadic purchases of otheraerial weapons types, among them a ship-ment of bomb release systems produced byKrasyliv’s Assembly Manufacturing Plant.Ukrainian land warfare equipment sup-plies to China, on most occurrences, in-cluded fully-integrated conventionalsystems such as 2C9 large-caliber artillerysystems or BTR-70 armored personnel car-riers. Regarding defense electronics,Ukraine once delivered to China a few‘Kolchuga’ passive electronic monitoringradar systems.

– A shift has recently been noticeabletowards increasing occurrences of Ukrainetransferring production licenses (as Chinaplaces premium precisely on know-howand production technology) and providingrepair and maintenance services, withChina being most interested in acquiringthe knowledge of principal importance forthe development of own defense industrialcapabilities.

Existing cooperative projects do notallow for Ukraine to participate as a full-fledged partner in the development ormanufacture of defense technologiesjointly with China, Ukraine’s worksharebeing mostly confined to ‘hot spot’ worksor ‘hot spot’ projects. But how could it beotherwise if Ukraine has never investedmoney in the promotion of some or other


Fourth chapterMilitary-Technical Cooperation between Ukraine and China:Directions and Cooperation Patterns

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initiatives to date, its role being effectivelyreduced to performing, on the outsourcing

basis, the tasks which China thus far lacksthe expertise or capability to perform on its


Selected international collaboration and cooperation patterns relating to R&D/pro-duction of weapons and defense technologies

№ Cooperation/collaborationpattern Brief description

1 Licensed production A form of transnational cooperation providingfor the selling/transfer of production informa-tion which enables a foreign government/pro-ducer to manufacture an item of defenseequipment

2 Co-production A form of international division of labor wheretwo or more participating countries share, basedon their core expertise and knowledge in respec-tive areas, the manufacture of an item of defenseequipment designed and developed by one ofthe participating countries

3 Joint venture An entity jointly owned and managed by de-fense-industrial firms/corporations of two ormore countries to undertake the developmentand manufacture of a specific item or type ofarms or defense equipment together

4 Collaborative design and de-velopment

A form of cooperation where entities from two ormore countries are working together to design,develop and (usually) commercialize an item ofarms or defense equipment

5 A family of weapons system A form of international division of labor where twoor more countries undertake to work together toproduce a family of weapons systems or defenseequipment (for example, air-to-air missiles). For thispurpose, each specific weapons system or an item ofdefense equipment is designed and developed byone participating country to be subsequently co-manufactured by all the participating countries.

6 Multinational strategic al-liance

A formal relationship between defense-industrialfirms/corporations of two or more countries. Thealliance is a cooperation aimed for a synergy wherethe benefits from the alliance will be greater thanthose from individual efforts. The strategic allianceusually provides for information swapping betweenpartners or investigating into potentialities for fu-ture cooperation in the design, development andmanufacture of new weapons types or items of de-fense equipment.

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own. Meanwhile, the global collaborationbest practices provide a few examples ofcooperation patterns that could be applica-ble to specific areas or projects.

Ukraine’s interest in cooperation withChina in military-political and military-technological sectors can and must be look-ing at the medium and long term. In themilitary-political cooperation sector,Ukraine should direct its efforts towardscreating an environment for a strategicpartnership to be set up between the twocountries, as Ukraine and China do nothave ‘zones of conflict’ or differences relat-ing to their respective national security in-terests. In the military-technological sector,cooperation between Ukraine and Chinashould be built up with due regard for theglobal market trends in the developmentand production of weapons and defenseequipment, specific nature of that ex-tremely competition-sensitive market, aswell as the immediate top-priority goalsthe two countries are most interested toachieve in the short term.

China is interested in Ukraine as a co-operation partner in areas such as theoryand practice of building aircraft carriersand ‘Zubr’-class landing craft air cushionvehicles; theory and practice of employingsimulators for naval force training; ac-tive/passive radar equipment; ballisticmissile system controls; and the develop-ment of AFV and aircraft engines as wellas gas-turbine engines.

Ukraine’s mid-term interest in mili-tary-technical cooperation with Chinashould comprise areas such as militaryaeronautics (specifically fighter, military-transport and combat capable trainer air-craft), missile technology and defenseelectronics. China as a military-technolog-ical cooperation partner is of interest toUkraine in that China has successfully re-solved many of the tasks relating to the de-

sign, development and production of mili-tary equipment types based on Soviet-eradesigns. Here, it has strongly reinforced itsscientific research and industrial capabili-ties that enabled it to go away from de-pendence upon Russia in meeting itsdefense-related requirements, and, fur-thermore, to generate alternative solutionsin a number of military technology areas.When the interests of both partners coin-cide and optimum cooperation patterns areidentified, these potentialities, if properlyemployed, could help Ukraine resolvesome of the pressing problems existingboth on the domestic and global defensemarkets.

There are two aspects in which Chinais distinguished from Ukraine or Russia,whose defense companies often act in tan-dem when carrying out projects for thePRC. First, China has built and continuesbuilding own military technical schools ofthought in high-technology clusters. Sec-ond, it has persistently worked to enhanceand improve its industrial base on whichto produce some or other weapon of de-fense equipment types. These two compo-nents of principal importance, specificallyhuman resources and industrial base, arewhat will provide a strategic advantage forChina in re-designing and improvingweapons and defense equipment types im-ported from Russia or Ukraine and, also, indeveloping indigenous defense designs.The extent of wear-and-tear of defense-in-dustrial assets in Ukraine and Russia issuch that, on many occurrences, it effec-tively prohibits them from creating defensetechnology designs capable of competingon the export market with Chinese-devel-oped alternatives, particularly in terms ofcost effectiveness. This, among other areas,is about microelectronics, optoelectronicsand measuring elements which intrinsi-cally comprise the ‘nervous system’ of any


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of weapons systems, upgraded or devel-oped. China has acquired the strategic ad-vantage of this kind through high-techequipment acquisitions from Europeansuppliers among other things, and the ben-efit from this advantage will only grow astime goes by.

AeronauticsThe aeronautics sector is the one that

dominates in military-technical coopera-tion between Ukraine and China. This is nowonder, considering Ukraine’s expertiseand capabilities in this particular sector.ANTK Antonov Aeronautical Scien-tific/Technical Corporation, for instance,enjoys a pretty rich history in working to-gether with Chinese partners. This, aboveall, is about cooperative R&D projects andupgrades on transport (military transport)aircraft for China. In 2002, ANTK Antonovand China Aviation Industry Corporation I(AVIC I) signed a contract under a Chineseprogram to design and develop China’sfirst ever regional turbojet airliner of theXXI century, the ARJ-21.

The contract provided, in particular,for co-development of a supercritical wingfor the aircraft. Antonov’s responsibilitiesunder the contract included intermediateand final calculations, computing geome-try of the wing, building its simulationmodels, and evaluating the wing’s main-tainability and robustness performance.Furthermore, Antonov subjected supercrit-ical wing models of various configurationsto wind-tunnel testing, along with modelsof the aircraft as a whole, including theones with power jet simulators.

In addition to this, the Ukrainianparty built a wind-tunnel model of theARJ-21 and subjected it to high-speed tun-nel testing. Antonov provided Load Analy-sis on which basis the wing’s static loadstrength and fatigue evaluation had been

carried out, and it also assisted in the build-ing, testing and subsequent qualification ofthe aircraft.

As well as the ARJ-21 project,Antonov has been engaged with ShaanxiAircraft Industry Corporation (SAC) in re-designing the Y-8F600 aircraft – an up-graded variant of the Y-8F400, itself aChinese copy of the Antonov’s An-12 air-craft. Antonov’s workshare under the proj-ect included R&D works, development ofwing production technology, building sev-eral aircraft models and providing techni-cal advice on aircraft testing. Remarkablyenough, it was Anonov who, at its time,advised China Aviation Industry Corpora-tion II (AVIC II) to invite Ukrainian aircraftengine makers ‘Motor-Sich’ and Ivchenko‘Progress’ Design Bureau to join in the Y-8F600 project.

In September 2007, ANTK Antonovand SAC signed a memorandum of intentto set up Beijing’s aeronautical engineeringcenter – a joint venture operating in fullconformity with respective legislations ofUkraine and China. The joint venture hasbeen set up to perform contractually re-quired works involving R&D on new air-craft and upgrades to already existingdesigns; validation of new aircraft designs;aircraft layout design; preliminary re-search; project evaluation and scientific re-search works of other kinds. It has been projected that the joint venturewould perform development and engi-neering work on a lightweight short take-off and landing (STOL) transport aircraftand a medium STOL transport aircraft, as-sist in a Chinese project to build a largetransport airplane and support upgradeprojects for legacy aircraft designs.

Meanwhile, potentialities of China’scombat and trainer aircraft industries areof interest to Ukraine, most notably in thecontext of the challenges facing the Ukrain-


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ian Air Force (UAF). Specifically, theUAF’s fighter fleet of ‘lightweight’ MiG-29sand heavier Su-27s has almost reached thelimit of its service life, and as such the fleetneeds to be upgraded to preserve its mili-tary usefulness. That means that the UAFhas, first, to evaluate the fleet’s serviceabil-ity status, perform its projected reliabilityanalysis and, based on the results obtained,to determine the amount and the list of theworks to be done. Once this work is com-pleted, the fleet will need to be upgradedto modern standards, and this endeavor isgoing to be even more complex and chal-lenging. Both life extension and upgradestraditionally require designer’s andmaker’s authorization. For Ukraine, thatissue has become a political one, as the de-signers and makers of almost all core sys-tems in the Ukrainian Armed Forces’inventory had left in Russia following thedemise of the USSR. By 2009, not a singlejoint project relating to UAF’s fleet mod-ernization had existed between Ukraineand the Russian Federation. Against thisbackdrop, Ukraine’s parliament, the Verk-hovna Rada, on April 15, 2009, adopted abill “On amending some laws of Ukrainewith regard to maintaining serviceabilityand upgrading of the Ukrainian ArmedForces’ weapons arsenal and equipment in-ventory”. Under the new legislation, theCabinet of Ministers and the Ministry ofDefense are vested with the authority overthe Ukrainian Armed Forces’ weapons sys-tems and military hardware that are freefrom Designer Supervision. In actual fact,this applies to the aircraft fleets, missilesystems and other ‘disputed’ equipmentinventories on which Ukraine and Russiahave never reached any sort of a mutuallyacceptable agreement to date.

Regarding the MiG-29 fighter fleet,the Ukrainian MoD has developed a pro-gram allowing for a limited upgrading of

the fleet to be solely performed by MoD’sand Ministry of Industrial Policy’s repairfacilities. But with the heavier fighter fleet(Su-27), the situation appears to be far lessclear, if not threatening, given that almostall of the UAF’s Su-27s would havereached the end of their expected servicelife as early as by the beginning of 2010.This being the case, upgrading and life ex-tension of the Su-27 fleet becomes an ex-tremely urgent challenge for the UkrainianArmed Forces. Unlike with the MiG-29,any kind of full-scale upgrading of the Su-27 would be outside the scope of the do-mestic defense industry capabilities.Notably enough, according to the UAFCommander, Ivan Rusnak, “In the late1990s/early 2000s, China bought from Rus-sia a great quantity of Su-27 and Su-30MK-type aircraft together with relatedproduction license. It is no secret that, asstrange as it may seem, it was Ukrainewhere repair know-how and relating en-gines for the aircraft came from to China,and it was Ukraine where Chinese special-ists were taught how to do repairs on theaircraft of this type”.

China, who had been buying Su-27multi-role fighters for a long period oftime, has already license built the Su-27,under own designation Shenyang J-11. En-gines appeared to be not among the Chi-nese aircraft industry’s strong points. Butthis is not the case now; China has alreadydemonstrated a domestically designed al-ternative to the Russian AL-31F jet engineit has been buying to date as primarypower plant for the Shenyang J-11. In Feb-ruary 2008, Russian defense export author-ity Rosoboronexport’s representative to thePRC, Andrei Plotnikov stated that “…atechnological breakthrough achieved byChina in the aircraft engine area has al-lowed for the proportion of Chinese-madecomponents and technologies to be in-


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creased from 70-75 percent to 90 percent oreven higher”. Given the progress made byChina’s fighter aircraft industry recently,Ukraine might consider recruiting Chinesepartners to help resolve some of the tech-nological tasks associated with its Su-27fleet upgrade.

In the military-transport aircraft sec-tor, Ukrainian engagement with Chinamight include identifying a cooperationpattern enabling the Antonov An-70 mili-tary-transport aircraft to be licensed as-sembled in China, following a patternalready tested by Ukraine in joint work onthe An-140 and An-148 aircraft projectswith Iran. Such an approach might be ac-ceptable to China as well, considering thatit has already employed similar patterns toestablish domestic production of a range offoreign-designed aircraft types. Remark-ably, China Aviation Industry CorporationI (AVIC I), back in 2007, announced its in-terest in producing a new heavy transportaircraft with a payload capacity of 60+tons. For this purpose, the Chinese partywas considering a few cooperation pat-terns with Ukraine, specifically recruitingANTK Antonov to assist in R&D works onthe new aircraft, buying an equity inANTK Antonov (provided that there is anappropriate authorization by the Ukrain-ian Government) and setting up a jointventure to support the project both inChina and Ukraine.

This would be advantageous toUkraine in that it would allow for the An-70’s potential customer base to be ex-panded to reach the large Chinese market.On the other hand, this involves the riskthat the An-70 may follow the same path asthe Russian-designed Su-27 which eventu-ally has become strongly ‘Chinized’ in allof its key components and subsystems.That risk could be alleviated, for example,by way of an equity for equity swap be-

tween ANTK Antonov and the re-emerg-ing Chinese aircraft corporation AVIC-I-AVIC-II. This option (which requires aspeedier pace of the process to transformthe ANTK Antonov into a share-holdercompany) would provide a platform en-abling parity-based cooperation and mu-tual oversight of marketing practices beingemployed or work being carried out onsome or other specific market. At the sametime, this direction of joint work on the An-70 project with China still allows Kiev topursue its own effort aimed at advancingthe aircraft to the European market to fillin the gap emerged as a result of delayswith completion of the A400M program.

Furthermore, ANTK Antonov offersfor employment on China’s airlift and com-mercial passenger air transportation mar-kets several of its current-generationaircraft such as the new regional airlinerAn-148, in addition to the An-74-series air-craft that are currently being advanced to anew, higher level of development. Chinesecustomers, as before, are welcome to usethe Antonov Airlines’ fleet of the An-124-100 ‘Ruslan’ transports. Moreover, there isan agreement on intent concerning a Chi-nese development project for a new re-gional 70-seat turboprop airliner.

Regarding the trainer aircraft sector,mention should be made of a proposalmade to a visiting Ukrainian MoD team inJanuary 2009 to consider potentialities forco-production of the supersonic trainer air-craft L-15, a design by the AVIC II’sHongdu Group. In that context, it is im-portant to know that Ukraine’s OJSC‘Motor-Sich’ – the flagship aircraft enginesupplier on the post-Soviet expanse — hasbeen engaged with Chinese aircraftbuilders since 2006, when it signed a con-tract with Hongdu/AVIC II for an initialsupply of AI-222-25F engines to equip theL-15s. The overall volume of the supply is


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projected to eventually amount to 200+ en-gines, with 10 engines delivered in 2008and 22 more ordered for delivery by theend of 2009, at a price tag of about $1 mil-lion each. The 4000 kg thrust AI-222-25F, adesign by Ivchenko State Design Bureau‘Progress’, is series manufactured by OJSC‘Motor-Sich’ in cooperation with MMPP‘Saliut’ of Russia. As well as the L-15, itequips the future Russian combat-capabletrainer Yak-130. The L-15 is powered bytwo reheated engines. At this stage, neitherMotor-Sich nor MMPP Saliut have an in-terest in transferring production license forthe AI-222-25F to China.

On January 19, 2009, the UkrainianMoD’s press office reported the then Min-ister of Defense Yuri Yekhanurov as say-ing: “Even though it is the L-39 attack andtraining aircraft that is operationally de-ployed with the Ukrainian Armed Forces,the proposal voiced in Beijing looks highlyinteresting. Here at the Ministry of De-fense, sufficient capabilities exist to doprojects of this kind. Now we are going toinvestigate into technological potentialitiesof our aircraft repair companies and holdfocused negotiations with Chinese repre-sentatives with respect to possible produc-tion of this type of combat-capableairplanes”. The L-15, which comes at aprice of about $15 million, shall not be con-sidered as a rival to the Russian Yak-130, atleast before it becomes clear which of thetwo aircraft with Ukrainian engines wouldbe better selling on the export market.

Naval ships and related equipment and systems

China’s top-priority program in thenaval shipbuilding area is an indigenouslydesigned aircraft carrier. This program isnoticeable in two aspects. First, eventhough Beijing has continued with pursu-

ing program-focused foreign acquisitions,it still lacks the expertise required to builda ship of this type and dimensions. Second,Beijing is keen to get the indigenous carrierbuilt at the earliest time possible. This allgives a chance for Ukrainian companies toget contract awards for skills and ship-building technology transfers and for sup-plies of selected components andsubsystems for ships and naval aircraft.Ukrainian shipbuilder ‘Black Sea Ship-building Yard’ once built the Project 1143.5heavy aircraft carrier ‘Kuznetsov’ (which iscurrently operationally deployed with theRussian Naval Force) and the same-classProject 1143.6 aircraft carrier ‘Variag’which was sold to China when 70-percentcompleted. One more such ship, the Proj-ect 1143.7 heavy aircraft carrier‘Ulyanovsk’, which was designed with anuclear propulsion system and an enlarged70-aircraft ship-borne component, waseventually dismantled in a building berthwhen half-completed. The shipbuilder em-ploys two dry docks large enough to ac-commodate heavy carrier-class vessels,and it has the core expertise and technol-ogy required for building them.

In April 1998, Beijing bought fromUkraine the heavy aircraft carrier ‘Variag’whose ownership came over to Ukraine asa result of the Soviet Black Sea Fleet divi-sion between Kiev and Moscow. The build-ing of the ship was brought to a halt in 1992when it was 67-pct completed, and as suchit was sold to the Chinese military for only$28mn. By comparison, same-class current-generation aircraft carrier costs billions tobuild. The remarkable ‘feature’ of the deal,as was widely reported at the time, wasthat the intent of the firm that initially pro-cured the ship was to renovate and refit itinto a leisure and gambling center. Backthen, many analysts did not preclude thepossibility that the canard reports were


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willfully distributed to disguise true intent,specifically to obtain a half-built aircraftcruiser for next to nothing. In 2008, the shipwas re-designated as ‘Shi Lang’ after therenowned Chinese military commander,which would be out of tradition for acasino. According to numerous media re-ports, the carrier was planned to be com-pleted by 2010 and subsequentlycommissioned with the Chinese Navy. An-alysts are almost unanimous in the opinionthat China’s purchase of the ‘Variag’ car-rier might be considered to be a latent formof scientific-technical assistance or know-how transfer that saved Chinese scientiststen years’ worth of upstream materialstechnology research.

Basically, Ukraine’s defense industryhas the capability to equip all Chinese air-craft carriers with propelling plants (if thegas turbine engine type is selected as a finaloption). Mykolayiv-based State-ownedcompany ‘Zoria-Mashproekt’ Researchand Production Complex of Gas TurbineBuilding supplied China with a shipmentof DA/DN-80 gas turbine engines whichhave already been installed on four of theChinese Navy’s Luyang-1/2-class multi-role destroyers. China was reported tohave bought production license for theDN-80 gas-turbine engine. Here, however,some risks have to be considered. Specifi-cally, the building of aircraft carriers forChina should be carried out as a trinationalChina-Russia-Ukraine program. Thiswould be impracticable to implementwithout Russia as the supplier of some keysubsystems and components as well asnaval weapons systems. In such a case, ifChina opted to tap Russia and Ukraine forits aircraft carrier program, one more issueto be addressed is the character and levelof military-technical cooperation betweenthe latter two, which has shown a strongdownward trend recently. The other side

of that coin is that the U.S. thinking towardChina’s effort aimed to build its own air-craft carrier fleet would certainly bestrongly negative, considering military-po-litical stand-off between the two countriesand their rivalries over geopolitical domi-nance in the Asian-Pacific region. The levelof influence the U.S. leaders have onUkrainian ones would be sufficient tomake Ukraine give up altogether any hopeof supplying propelling plants for Chinesecarriers.

China intends to have four medium-size aircraft carriers in place by 2020, withthe first-of-class planned to be integratedinto the Chinese Navy by 2016. That shipis going to be of the same class as the So-viet-era heavy carrier ‘Variag’ with a dis-placement in the order of about 65,000tons. Four carrier warfare groups are ex-pected to be deployed in the South ChinaSea and East China Sea to secure maritimeenergy corridors and safeguard China’sterritorial waters there.

It is worthy of note that a Ukrainiantrace might be found in China’s effort tobuild an indigenous carrier-based fighter,under a program being carried out on aparallel track with the indigenous carrier.According to Western media reports, in2006, China purchased from Ukraine a T-10K test aircraft – one of preproductionprototypes of the Su-27 carrier-basedfighter (ancestor of the Su-27/Su-33). Noprizes for guessing that the purchase mightbe intended to get into the construction ofthe aircraft’s folding wing, ruggedizedlanding gear, arresting hook system and soon. Later in 2006, China bought, presum-ably from the Russian Federation, four setsof the Su-33 naval fighter’s tailhook systemto be employed, as the buyer put it, ‘for ex-perimentation purposes’. The Su-33’s tail-hook system supply package alsocomprised a set of deck take-off/landing


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equipment, including four sets of cross-deck arresting gear, aircraft arresting netsystems and other equipment.

This all is closely interrelated withChina’s interest in co-operating withUkraine on the lease of its naval ship-bornepilot training center NITKA located at theCrimea Peninsula. At present, the Russianshipborne aviation force is leasing NITKAuntil 2011. The Chinese party has an inter-est in the naval pilot training center to beleased to the People’s Liberation Army(PLA). The establishment of the Chineseversion of NITKA pilot training center willlag behind the construction of aircraft car-riers, and because of this, the training of pi-lots should be pushed ahead first. As aresult, there is the need to send pilots toUkraine for training and thus need to leasethe NITKA training base. This is for onething. Second, the construction of the Chi-nese version NITKA is a very costly andtechnologically demanding project, andalso takes a long time. Particularly, this issupposed to include the take-off and ar-resting systems on the aircraft carrier.Moreover, it also requires the constructionof supporting airports, which must be incostal regions close to the shore. Other es-sential facilities include computer-basedsupport system. NITKA is in fact a ‘land-based aircraft carrier project’ without radaror weapons systems.

For this reason, Russia took more thanten years to discuss the plan of building itsown aircraft pilot training base and has notyet initiated the project. The prime concernis the actual number of shipborne pilots tobe trained will be limited and the cost isvery huge.

Several scenarios might be predictedfor China’s lease of NITKA training facil-ity. Due to the national character, Chinawould not want to be restricted by anyparty in the course of its ‘Grand Aircraft

Carrier’ Project. In that event, leasingUkraine’s NITKA is supposed to be a tran-sitional tactic, waiting for the completionof China’s own NITKA. Before this, Chinamay lease NITKA for a short period of timeto have early phase computerized simula-tion flight or land-based taking-off andlanding training of its naval aviation pilots.Such training usually takes six months.Consequently, China’s lease of the trainingcenter is probably short-term and its in-vestment in upgrading the training infra-structure at the facility would also be verylimited.

The second scenario is very likelyChina’s leasing the training center pendingthe respective stage of its aircraft carrier de-velopment. When it requires training thepilots at different stages, the lease agree-ment could be limited to half a year. Thethird model is not ruled out, with Chinapurchasing NITKA’s blueprint and soft-ware or even some of its engineers andtechnicians so as to speed up the construc-tion of its own NITKA. The ChineseNITKA may eventually be built at HainanIsland.

At this stage, the Russian Navy doesnot want to share this training center withthe Chinese. Ukraine will have to work to-gether with Russia on the issue of leasingNITKA to China, and Russia will also havea share of the leasing fee. Without Russia’shelp, the Chinese naval aviation pilotswould not be able to fully master the take-off/landing training regulations on Russ-ian-style aircraft carrier even if they arriveat NITKA

Air-cushion vehicle programsChina has invested much effort into

the development of its Naval Force’s land-ing craft air-cushion vehicle component.Particularly, it has launched practical-im-


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plementation phase of its program to in-troduce Type 071 large landing platformdock (LPD) into service with the PLANavy. The first-of-class Type 071 was com-missioned with the PLA Navy in Novem-ber 2007. The vehicle is propelled by fourgas-turbine engines supplied by Zoria-Mashproekt. With the Type 071 platformsin place, the PLA Navy will obtain funda-mentally new capabilities to be initially de-ployed for possible offensive operations toseize Taiwan and, afterwards, for futureoperations elsewhere in the World’s oceansand seas. The Type 071 is designed to be-come PLA Navy’s core landing compo-nent. According to the Type 071 LPD’sofficial description, its sealift capability isenough to carry a battalion-size marinecorps unit, including 500-800 troops, 15-20amphibious armored vehicles and fourlanding craft air-cushion (LCAC) vehicles.

The Type 071 LPD Program sub-sumes the development of an indigenousLCAC vehicle design based, according tovarious reports, on a same-class U.S. de-sign or the renowned Soviet-developedlanding air-cushion vehicle ‘Zubr’ that iscurrently being manufactured in Ukraineand Russia. The ‘Zubr’ class of LCAC ve-hicles is intended for autonomous opera-tion to project amphibious assault assets tothe designated battlefield. Conceptually, itwas designed for roles such as rapid beach-head seizure in the Black Sea and Baltic Searegions. The ‘Zubr’ might be of interest toChina in that its capabilities allow it to bedeployed as a frontline attack componentto support possible marine assault opera-tions in Taiwan. Zubr’s primary role therecould be the seizure of forward beachheadsand support of lodgement expansion asfollow-on forces arrive on Type 071 LPDplatforms. This means a chance for Ukrain-ian defense companies to receive lump-sumorders that they so drastically need today.

The building of Project 1232.2 smalllanding craft air-cushion vehicles ‘Zubr’ isbecoming a separate area of Ukrainian-Sino military cooperation. In 2008, follow-ing a series of unsuccessful negotiationswith the Russian Federation on the pur-chase of 10-15 Project 1232.2 ‘Zubrs’, Bei-jing entered into negotiations with Kiev. InMay 2009, Ukrainian Minister of IndustrialPolicy announced that the PLA Navy isgoing to award Ukraine a contract to sup-ply four Project 1232.2 landing air-cushionvehicles to be built by Feodosia’s FSK‘Morye’. Jane’s Defence Weekly estimatedthe cost of the future deal at $315mn, andadditionally reported that the contractaward was signed in Kiev by visitingdeputy Chairman of the National Commit-tee of the Chinese People's Political Con-sultative Conference on July 2, 2009. Otherreports have it that the two parties are inthe final stage of signing the contract whichis not advertised, simply by virtue of a va-riety of subjective and objective factorssuch as resistance on the part of some Russ-ian businesses.

In Ukraine’s case, the contract is valu-able in terms of the number of companiesto be tapped for subcontracted works, in-cluding seven potential subcontractors atthe Crimea Peninsula alone. In addition,Beijing’s $3mn worth of initial investmentunder the contract would allow FSK‘Morye’ to settle its debts. Of the four vehi-cles contacted, two will supposedly bebuilt in Ukraine and another two in China,under the supervision and with assistanceof Ukrainian engineers and technicians.Lessons to be learnt from the experiencewith building air-cushion vehicles at itsown yards would enable China to subse-quently series produce this type of landingassets in quantities that might be requiredby the PLA Navy. Even if this is the case,China would not be able to replicate in full


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all the production technology involved,and therefore it will have to purchase someparts and components from foreign sup-pliers (in Ukraine and Russia). Given thePLA’s requirement for assets of this kind,there should be an expectation of substan-tial Chinese orders for ‘Zubr’ ACV compo-nents and subsystems supplies.

Naval and aircraft enginesChina’s cooperation with Zoria-

Mashproekt holds promise for projects be-yond the ‘Grand Aircraft Carrier’ program.Some media sources reported that in mid-2009, Zoria was awarded a $55mn contractto supply four gas turbine propulsion sys-tems to the PLA Navy. Ukrainian gas-tur-bine engine designs might replacetechnically obsolescent KVG-4 steamboiler/turbine propulsion systems, and,also, could comprise the core of the propul-sion-machinery plant on the non-nuclearcruiser being developed in China aroundthe Soviet-vintage Type 1143.5 cruiser de-sign. Moreover, Beijing is examining theprospect of its Russian-supplied Sovre-menny-class destroyers to be repaired inUkraine. PLA’s Navy operates two Type956-E destroyers and as many Type 956-EM destroyers. What attracts China mostin the prospect of having its naval ships re-paired in Ukraine is a relatively low cost ofhigh quality repair services. On the otherhand, there may as well be an interest inobtaining technical documentation re-quired to organize repairs of naval shipsand shipboard weapons systems in China.

In the aircraft engine sector, there isan intensive work going on with China fo-cused on building up aero-engine repaircapabilities. This direction of joint workwith the PRC may hold a promise of sig-nificant orders, given potential capacity ofthe market for fixed-wing aircraft and ro-torcraft with Ukrainian engines. One more

potential cooperation area relates to theKarakorum-8 (K-8/JL-8) basic jet traineraircraft developed as a bilateral project be-tween China and Pakistan. The K-8/JL-8design allows for three choices of engines:U.S., indigenous Chinese or Ukrainian.China’s initial choice was the U.S.-deignedTFE731-2A turbofan engine. But the U.S.-led sanction against China forced it toswitch to the Ukrainian Motor-Sich AI-25TLK turbofan and, eventually, to theChinese indigenous WS-11 (licensed copyof the Ukrainian AI-25TLK).

As well as aircraft and gas-turbine en-gines designed for integration with the mil-itary equipment types being developed tomeet the PLA’s requirement under jointprojects with third countries, Ukraine issupplying China with AFV engines as well.Pakistan’s military, after taking the deliv-ery of a shipment of T-80UD tanks fromUkraine, continued with the developmenteffort for its indigenous Al-Khalid mainbattle tank. The Al-Khalid is a design de-rived from the Chinese ‘Type T-85’ whichhad been series manufactured in Pakistanuntil it ceased to meet modern standards.The Al-Khalid required an engine with anoutput of 1,200hp which China did notmanufacture. Therefore, a foreign-de-signed 1,200hp diesel was to be selected.The final choice was made in favor of aUkrainian engine and gear box, andUkraine, represented by trading firm‘Progress’, was awarded a contract to sup-ply the tank’s most sophisticated subsys-tem to Pakistan. The Malyshev Plant, basedin Kharkiv, delivered to Pakistan 15 engineand gear boxes for integration with the Al-Khalid during 2001. Work started in thesummer of 2002 on a follow-on three-year$100mn contract to supply 285 engine andgear boxes for upgrading other AFV typesalready operated by Pakistan’s ArmedForces.


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Missile systemsChina was purchasing air-launched

missiles from Ukraine and Russia duringseveral years. In 2005/2006 alone, Ukrainesupplied 953 (363+590) R-27 medium-range airborne missiles to China. In2007/2008, China did not buy R-27 mis-siles, which might be indicative of twothings. First, China has already acquiredenough missiles of this type to meet thePLAAF requirement and, second, it hastechnologically resolved the task of estab-lishing indigenous production of the mis-sile design at its own factories. It’s worthmentioning now in this context that Chinahas already demonstrated an indigenousactive radar beyond-visual-range (BVR)air-to-air missile design, the Ramjet SD-10.This has certain engineering design andconstruction features revealing a similarityto same-class missile designs by Russiandesigner company KB ‘Vympel’ which,along with Scientific Research InstituteAGAT, assisted in Chinese air-to-air mis-sile developments. The SD-10 has extrafour fore-mounted control fins on its ex-tended nose body, making it outwardlyvery similar to the R-27/AA-10. The ramjetmotor’s two rectangular inlets bear astrong resemblance of inlets on the RVV-AE-PD/R-77M-PD missile – a design thatwas left without Russian Governmentfunding but was probably employed withgreat effect by Chinese missile design en-gineers.

The Ukrainian Air Force (UAF) has arequirement for long-range air-launchedmissiles, in conformity with its ‘au-tonomous defense’ concept. This require-ment might be fulfilled, among otheroptions, through speeding up the pace ofindigenous long-range AAM design effort,or direct acquisitions from or developmentand production of BVR missile designsjointly with China.

China has also demonstrated greatprogress with developing and building in-digenous surface-to-air missile (SAM) de-signs. The HQ-9 SAM system (Chinesecopy of the Soviet-designed S-300), whichcan defeat targets at ranges in excess of 100km, employs a Chinese indigenous guidedSAM missile derived from theSoviet/Russian-developed 5V55. The HQ-9 is operationally deployed with the PLAAir Defense Force and it is currently com-peting in a Turkish long-range SAM tenderalong with Russia’s S-400 and U.S. Patriot.It could be said with a high degree of cer-tainty that it is China who is going to pro-vide the toughest competition to Russia onthe long-range SAM markets where thesupply of U.S. ‘Patriot’ SAM systems is im-possible for political reasons. In themedium and long term, China might be ofinterest to Ukraine as a potential coopera-tion partner in bringing up to modern stan-dards UAF’s SAM assets, notably in theaspects where real alternatives to Russianproposals might be required.

As is the case with upgrading and life-extension of the UAF fighter fleet, Ukrainehas experienced the same difficulties withupgrading its air defense weapons arsenal,specifically S-300-series SAM systems.Ukraine has since 1993 persistently pro-posed that Russia should assist in upgrad-ing to modern standards and extendingoperational life of the UAF’s SAM weaponsinventory. To date, agreements have beenreached with Russia on a very limited num-ber а projects. In 2003, a joint project wascompleted to extend operational life of theUAF’s 5V55R and S-300P SAM system in-ventories from 10 to 15 years. The core ofUkraine’s surface-to-air missile shield iscomprised by Soviet-era S-300PT and S-300PS SAM systems manufactured back inthe mid-1990s and providing effective en-gagement ranges limited to 75 km. Newer


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and mode capable S-300-series versions hadnever reached Ukraine, unlike China whomRussia was supplying with the S-300PMU-1and S-300PMU-2 configurations.

In this context, mention should bemade of the development effort being car-ried out in Ukraine for indigenous SAMdesigns enabling air targets to be defeatedfrom extended ranges of up to 300 kilome-ters. Ukrainian developers of the indige-nous ‘Sapsan’ SAM design alreadyannounced that design and developmentwork for the tactical-operational air de-fense missile system would be pursuedwithout Russia’s assistance. This an-nouncement was made even before it be-came clear what kind of difficulties maypotentially emerge in developing this newprecision-guided SAM design. The issuesidentified could be resolved using China’sexpertise and practical work experiences inthis field. When Turkey failed to obtainproduction license for the U.S. MultipleLaunch Rocket System M-270 MPRS,Ankara proposed partnership to Beijing.As a result, Turkish Roketsan is series man-ufacturing for the Turkish Army tacticalSAM weapons ‘Yildirim I’ with a range of150 km and ‘Yildirim II’ (300 km) designedaround the China Aerospace Science andIndustry Corporation’s (CASIC) solid fuelmissile B-611.

Of particular interest to Ukrainemight be projects relating to access to thenavigation signal of China’s future BiedouSatellite Navigation and Positioning Sys-tem that is slated to become fully opera-tional by 2015 with 35 satellites in orbit. Atthis stage, China has five-satellite Beidouconstellation deployed in orbit, which isexperimental and has limited coverage andapplication. The Biedou constellation ofnavigation and positioning satellites willeventually comprise 35 satellites offeringcomplete coverage of the globe. Russia’s

program for its satellite navigation and po-sitioning system GLONASS, which wasoriginally planned to be restored to fullydeployed status (i.e. 24 satellites in orbitand continuous global coverage) by 2010,may not be completed at the time as sched-uled due to some unforeseen difficulties,and the European Union’s Galileo satellitenavigation constellation may not be fullydeployed by 2013 as planned, as well. BothGLONASS and planned Galileo systemshave been developed as alternative andcomplementary to the United States’Global Positioning System (GPS).

Defense electronicsIn a pretty rich history of Ukrain-

ian-Sino military cooperation, a separateplace belongs to the ‘Kolchuga’ passiveelectronic monitoring radar system, aunique-of-its kind design by the DonetskTOPAZ State Joint-Stock Holding Com-pany. China was the second export cus-tomer for the Ukrainian ‘Kolchuga’ radarsystem after Ethiopia, and ‘Kolchuga’ isthe first and almost the only fully-inte-grated system to have been exported byUkraine to China’s defense market todate. In this respect, given China’s ambi-tion and the ability to get ‘domesticated’everything up to sophisticated high-techweapons systems into indigenous de-signs, we would be so bold as to describethe 2002 export deal for four Kolchugasas being a genuine ‘breakthrough’. For2002, TOPAZ reported a net profit thatwas more than five times the respectivefigure for the previous year, thanks in nosmall part to the Chinese contract. Itcould be predicted with a high degree ofcertainty that four Kolchugas will be farfrom enough to satisfy China’s require-ment for surveillance assets in this cate-gory. What probably preventedrelationships with China on passive elec-


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tronic monitoring radar designs (andother potentially promising projects)from achieving the desired level of de-velopment was the notorious ‘Kolchugascandal’ and resulting consequences onthe 2002 deal with China.

In addition to Ukraine, China tookits beating as well, being accused, indi-rectly or sometimes directly, of havingre-exported the systems to Iraq. The PRCForeign Ministry even had to officiallydeny China being involved with allegedUkrainian supplies of advanced ESM(electronic support measures) systems‘Kolchuga’ to Iraq. The accusationsagainst China were catalyzed by U.S.and UK’s allegations that the deal wasassisted by an undisclosed intermediarycountry. American and British expertsdoubted the credibility of Kiev’s asser-tion that China was the intended recipi-ent of the four Kolchuga systems.Persistent demands that Ukraine dis-close the details of the Kolchuga dealwith China did not, to say the least, fa-cilitate further relationships growth withthe U.S, as Ukraine was not in a positionto reveal data containing commercialand government secrets of a foreigncountry.

If the Chinese would successfullyestablish commercial level production oftechnologies such as the ‘Kolchuga’,there is no doubt they will develop (andsell to whatever market they choose)their indigenous equivalents, under Chi-nese brand names. This task thus far ex-ceeds China’s ability, because thegreatest challenge here is not copyingthe equipment as such but, rather, com-prehending its operational algorithm.Ukrainian third-generation passiveradar designs, along with those devel-oped in the Czech Republic, are streets

ahead of all other rival designs existingelsewhere in the world, including theU.S. Considerable headway in this fieldhas now been made in Russia, still its de-signs are no competitors to the Kolchugain terms of performance and operationaleffectiveness. For this reason, the‘Kolchuga’ chapter in Ukrainian-Sino re-lationships should not be closed alto-gether.

Cooperation in spacetechnologies

Bilateral co-operation in this field isfocused on projects concerned with thefollowing:

– Information swapping on techni-cal parameters of the Chinese ‘Environ-ment-1-B’ and Ukrainian ‘Sich-2’ projectswith the goal of forging mutually bene-ficial co-operation in the exchange ofdata obtained from space-based assets;

– The supply of a laboratory instal-lation (together with related productionlicense) required to set up production ofspacecraft ion plasma thrusters in China;

– Forging mutually beneficial coop-eration on interrelating and complemen-tary IONOSAT Project of Ukraine andChina’s Seismo-Electromagnetic SatelliteProject.

Specialist training programsWhilst Ukrainian-Sino military co-

operation is mostly focused on exports offully-integrated systems, componentsand subsystems, services and technol-ogy, it also encompasses a variety oftraining programs for Chinese militarytechnology specialists. A few dozen jun-ior, middle and senior-ranking PLA offi-cers, together with several Chinesecollege professors, took training course


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at Kharkiv’s I.Kozhedub Air Force Uni-versity’s Department of Command andControl Computer Systems (C2CS) andAviation Ground Support Equipment. Ateam of PLA Missile Force officers tooka refresher training course in “utilizationof C2CS systems in command and con-

trol of missile forces and artillery”. Fur-thermore, Chinese engineers and techni-cians are undergoing training underspecialist training programs offered bymilitary aircraft and naval ship repaircompanies in Ukraine.


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eijing, on October 1, 2009, sawa military parade celebratingChina’s 60th Anniversary na-tional day. To provide an in-sight into modern China’s

global ambitions, below we offer a retro-spective look at the aerial vehicle types,most particularly the PLA Air Force’s fixedwing aircraft and helicopters that flew overBeijing in a show of force, complementingan Army vehicle parade. Twelve air eche-lons comprising a total of 151 fixed wingaircraft and helicopters participated in thislavish show. These air echelons included:

1 — 1 KJ-2000 AWACS aircraft; 8 J-7Gfighters;2 — 2 KJ-200 AWACS aircraft; 6 J-11fighters;3 — 9 H-6H bombers;4 — 2 H-6U aerial refueling tankers; 2 J-10 fighters; 2 J-8F fighters;5 — 15 JH-7A fighter bombers;6 — 16 J-8F fighters;7 — 15 J-10 fighters;8 — 12 J-11 fighters;9 — 10 Z-8K search and rescue (SAR)helicopters;10 — 18 WZ-9A attack helicopters withanti-helicopter weapons; 11 — 18 WZ-9A attack helicopters withant-tank weapons;12 — 15 JL-8 trainer aircraft.

Official comments during the paradedescribed the participating aerial vehiclesas latest-generation designs developed andbuilt in China. If their Chinese make is un-

deniable, there is some doubt as to whetherthey are truly ‘latest-generation indige-nous’ Chinese designs. Let us look and seewhat exactly these terms imply in this par-ticular context. Ten aircraft types and twohelicopter types participated in the Octo-ber 1 flypast show. Their specifications arepresented in the table below.

The availability of a fleet of airborneearly warning and control (AEW&C) plat-forms is a sine qua non of any modern airforce. It’s no coincidence that aircraft withprecisely this application were the ones toopen the Beijing’s flypast show. Thesewere one KJ-2000 and two KJ-200 AEW&Caircraft.

KJ-2000. The KongJing-2000 (KJ-2000)is the first airborne warning and controlsystem (AWACS) in service with the PLAAir Force (PLAAF), with four examplescommissioned between 2006~07. The air-craft is based on the airframe of the Russ-ian-made A-50/IL-76MD, but outfittedwith a Chinese indigenous electronicallysteered phased-array (ESA) radar that isless capable than the Russian alternative‘Shmel’ seen on the A-50. The KJ-2000 hasfive flight crew and possibly 10~15 missioncrew. The aircraft carries out patrol mis-sions at an altitude of 5,000~10,000m. Themaximum flight range of the aircraft is5,000km and the flight endurance is 7hours 40 minutes. At a range of 2,000kmand patrolling speed of 600 kmph, the air-craft can remain on patrol for up to 1 hour25 minutes. The primary radar system


Fifth chapterChina’s military parade as a mirrorof its global ambitions

B

58


housed in a radome is a three-sided elec-tronically steered phased-array (ESA) de-veloped by Nanjing-based 14 institute.Unlike the Russian A-50 or U.S. E-3, whichrotate their rotodomes to give a 360 degreecoverage, the KJ-2000's radar antenna doesnot rotate. Instead, three ESA antennamodules are placed in a triangular config-uration inside the round radome to pro-

vide a 360 degree coverage. The Chinese-made radar system could be similar in de-sign to the IAI Phalcon, but may not be ascapable as the latter. The Phalcon systemcould track up to 60~100 targets at thesame time and guide a dozen fighters inall-weather, day and night operations. TheKJ-2000 has an aerial refueling capabilitywith a nose-mounted refueling probe.


Fixed wing and helicopter types showed off during the 60th Anniversary Parade

Designa-tion J-7G J-8F J-10 J-11 H-6H FH-7A

year ofserviceentry

2004 2003 2004 1998 2002 2004

crew 1 1 1 1 4 2

engine(number/ty

pe)1xWP-13F 2xWP 13BII 1xAL-31FN 2xAL-31FN 2xWP-8 2xWS-9

thrust/withafterburn-

ing, kg4,400/6,700 4,800/7,000 7,770/12,500 7,770/12,500 9 500 5,600/9,300

max flyingspeed,kmph

2 450 2 300 2 450 2 500 1 014 1 810

max flyingrange, km 2 200 2 200 3 400 4 000 6 000 3 650

operationalradius, km 850 800 1 310 1 500 1 800 1 650

operationalceiling, m 18 800 20 000 18 000 20 000 13 000 16 000

wingspan,m 8 9 9 15 34 13

59



Designa-tion J-7G J-8F J-10 J-11 H-6H FH-7A

length, m 15 22 15 22 35 22

maxweight, t 9 19 19 33 76 29

combatpayload, t 2 4,50 4,50 6,00 9,00 6,50

number ofweapon

hardpoints5 7 11 10 2 11

guns 1x30mm 1x30mm 1x23mm 1x30mm none 1x23mm

bombs 4x500-kg 12x250-kg 8x250-kg 24x250-kg/8x500-kg

36x250-kg/18x500-kg 20x250-kg

guidedbombs - 2 LT-2/LS-6 2 LT-2/LS-6 - - 2-4 LT-2

unguided55mm/90m

m missileunits

2-4 2-6 2-6 8 (80mm) - -

guided air-to-surfacemissiles

- 2 Kh-31A 2 YJ-9/2 YJ-8K - 2 YJ-63 4 KD-88/

4 YJ-81/91

guided air-to-air mis-

siles2-4xPL-8

2-6xPL-8/11; 2-6xPL-12;2-6xR-27/77

2-6xPL-8/11; 2-6xPL-12;2-6xR-73/77

2-10xR-73;2-6xR-27 - 2xPL-8

externalfuel tanks 1-3x720L 1x1,400L;

2x800L1-3 none none 2xPL-8

60



Designa-tion KJ-2000 KJ-200v H-6U JL-8 WZ-9A Z-8K

year ofserviceentry

2007 2009 1996 1998 2005 2007

crewcrew

v5+10-15v 2+ 2 2 2 -

engine(number/

type)4xD30KP 4xPW-150B 2xWP-8 1xWS-11 2xWZ-8A 3xRT6A-67

thrust/withafterburn-

ing, kg12 000 4,250hp 9 500 1 720 740hp 1,941hp

flyingrange, km 5 000 5 620 6 000 2 140 1 000 700

max flyingspeed,kmph

850 662 1 014 800 315 255

operationalradius,km - - 1 800 - - -

operationalceiling, m 10 200 10 400 13,00 13 600 6 000 4 700

wingspan,m 50,50 38.0 34,2 9.63 11.37 (rotor) 18.9 (rotor)

length, m 46,6 34,02 35 11,6 13,46 23

maxweight, t 190 65 76 4,33 4,1 13

61


The KJ-200 is a short-range AEW&Caircraft based on a Y-8F600 airframe (vari-ant of the Y-8 transport, Chinese copy ofthe Soviet-designed An-12). The KJ-200 fea-tures a linear-shape active electronicallysteered array mounted on top of the fuse-lage. The aircraft is fitted with Westernavionics for improved performance.

Improvements on Y-8F600 include: a two-man cockpit fitted with modernized avion-ics including U.S. Honeywell navigationsystem; four Pratt and Whitney CanadaPW150B turboprop engines with BritishDodi R-408 six-blade propellers; increasedtake-off weight and range. It is less capableand less expensive as compared to the


Designa-tion KJ-2000 KJ-200v H-6U JL-8 WZ-9A Z-8K

combatpayload, t - - 18.5 (fuel) 1 2 5

number ofweapon

hardpoints- - - 5 2 -

guns - - - 1x23mm2x12.7mmmachine-

guns-

bombs - - - 4x250kg - -

guidedbombs - - - - - -

unguided55-90mm

missileunits

- - - 4 2 -

air-to-sur-face guided

missiles- - - - 8xHJ-8E -

air-to-airguided mis-

siles- - - 2xPL-8 8xTY-90 -

externalfuel tanks - - - 2 - -

62


KJ-2000, and could therefore be deployedin less important locations.

Four fighter types, the J-7G, J-8F, J-10and J-11 were demonstrated during the fly-past show.

The J-7G is a Chinese copy of the So-viet-designed MiG-21F-13/Fishbed-C su-personic jet fighter aircraft that has beenlicense produced in China since 1967. TheJ-7G entered the PLAAF service in 2004,with 24 examples having been delivered toa single PLAAF air regiment. The J-7G isequipped with an I/J-band KLJ-6E Lieying(“Falcon”) pulse-Doppler fire-control radarand an improved counter-missile ECMsuite. Propelled by the WP-13F-type en-gine, it has an excellent climbing perform-ance capability (195 m/s), enablesoperation within an 850km radius, andwithstands loads of up to 8g. Weaponscomplement for the J-7G includes a 30-mmType 30-1 gun plus up to 4 guided PL-8 air-to-air missiles on four outer pylons, or, al-ternatively, a 2t (4x500kg) bomb load, or upto 4 unguided 55/90-mm rockets. For anextended range capability, provisions aremade for up to 3 external 720L fuel tanks.The J-7 series fighters have been with-drawn from production, still they comprisethe majority of the PLAAF’s fighter fleet(756 of a 1,300-aircraft fleet) and supple-ment more capable and expensive counter-parts Su-27, Su-30 and J-10. The J-7G isroughly on a level with the oldest versionsof production-standard F-16 fighters interms of some performance capabilities, es-pecially maneuverability.

The J-8F is the most recent version ofthe J-8B fighter jet aircraft developed inChina from the J-8A fighter interceptor, it-self an enlarged version of the J-7 fighterpropelled by two WP-7 engines. The JB-8,which entered series production in 1988, iscomparable in performance capabilities toearlier versions of the F-4 and Su-15 fight-

ers. The J-8F multi-role fighter entered thePLAAF service in 2003, with 20 examplesplaced under a single PLAAF air regiment.The PLAAF currently operates a combinedfleet of 254 J-8-series jet fighters. The J-8Ffeatures a JL-10 radar and WP-13BII en-gines. The aircraft is capable of near-ground speeds of up to 1,300 kmph andclimbing speeds of up to 200-240 m/s, andoperating within an 800-km radius. Thefixed weapon on the J-8II includes a twin-barrel Type 23-III (a copy of the GSh-23L)23mm cannon with 200 rounds in a ventralinstallation. The aircraft has seven hard-points (one under fuselage and six underwings). The center fuselage hardpoint hasa GDJ-4 pylon integrated dispenser system,which can carry up to six 250kg low-dragfree-fall bombs, or a 1,400 liter drop tank.The under-wing hardpoints can carry up tosix air-to-air missiles in various configura-tions (Chinese PL-8/11/12 or Russian R-27/77) or six unguided 55/90mm rocketpods, or as many 250kg free-fall bombs.The two outboard wing hardpoints are alsopumped to carry two 800 liter drop tanks.Later variants of the fighter are also con-figured to fire the Russian-made Kh-31Aanti-ship missile or precision guidedweapons such as the LT-2 laser guidedbomb (LGB) or the LS-6 satellite guidedbomb. The J-8F could also be fitted with afixed in-flight refueling probe. Although ithas yet approached the capabilities of ad-vanced fighter aircraft such as the Su-27 orSu-30, it provides a relatively inexpensivesupplement to PLAAF’s existing third-gen-eration fighter fleet.

The Jian-10 (J-10) is a multirole, all-weather fighter aircraft designed for bothair-to-air and air-to-ground missions. Theaircraft was originally intended to be ahigh-performance air-superiority fighter tocounter the fourth-generation fighters suchas the Soviet MiG-29 and Su-27, and Tai-



wan’s F-16 and Mirage-2000. The develop-ment of the J-10 was reportedly assisted byIsrael who provided the technologies of itsIAI Lavi lightweight fighter, and, in themid-1990s, by Russia who supplied its AL-31F turbofan jet engine to power the air-craft. In 2004, the fighter wascommissioned with the PLAAF who cur-rently operates a fleet of 140 J-10s in five airregiments. The J-10 is equipped with an in-digenous fire-control radar featuring a me-chanically slewed planar array antenna,capable of tracking 10 targets and engag-ing 2 (using semi-active radar-homingAAM) or 4 (using active radar-homingAAM) of them simultaneously. Possiblybased on Russian or Israeli technologies,the radar is believed to be comparable tothe early 1990s-era Western fighter radardesigns. The J-10 provides near-groundspeeds of up to 1,470 km/h and withstandsloads of up to 9g. The fixed armament ofthe J-10 includes an internally-mountedType 23-3 twin-barrel 23mm cannon, plusup to 4.5 tons of consumable weapons. Theaircraft has 11 external stores stations forweapon carriage, three under each wingand five under the fuselage. The J-10 couldcarry a mix of medium-range air-to-airmissiles (MRAAM), short-range air-to-airmissiles (SRAAM) and drop tanks. Typicalair-superiority and interception weaponconfigurations are: 4xPL-11/12 MRAAM +2xPL-8 SRAAM + 1x800ltr drop tank, or2xPL-11/12 MRAAM + 2xPL-8 SRAAM +2x1600ltr drop tanks + 1x800ltr drop tank.In a typical surface attack mission, thefighter carries up to eight 250kg bombs,along with two drop tanks and two PL-8/9SRAAMs. Typical surface attack and inter-diction weapon configurations for the J-10are: 2xPL-8 SRAAMs + 6x250kg LDGPbombs + 2x1,600ltr drop tanks + 1x800ltrdrop tank, or 2xPL-8 SRAAMs + 2x500kgLGB + 2x1,600ltr drop tanks + 1x800ltr

drop tank + laser targeting pod. A furtherimproved single-seat fighter variant J-10Bhas been under development. It features adiffuser supersonic inlet (DSI), a Russian-style forward looking infrared and lasertarget designator pod and an improvedcounter-missile ECM capability.

The Shenyang J-11 is the Chinesecopy of the Su-27 (NATO reporting name:Flanker) air-superiority fighter built underSukhoi’s license since 1998. The PLAAF op-erates a 116-aircraft fleet of J-11 in 9 air reg-iments. The J-11 is fitted with theJL-10-type fire-control radar. Powered byAL-31FN engines, it provides near-groundspeeds of up to 1,300 km/h and climbingspeeds of up to 300m/s. It operates withina range of 1,500 km and withstands loadsof 9g. Weapons complement includes one30-mm gun GSh-301 plus up to 6 tons ofconsumable weapons. The aircraft has 10external stores stations for weapon car-riage, three under each wing and fourunder the fuselage. Consumable weaponsinclude R-73, R-27 and R-27ET/ER AAMs,250-kg and 500-kg bombs, unguided rock-ets B-8V1 (20 80mm rockets in each rocketpod). In its air superiority role, it typicallycarries up to ten AAMs (up to four R-73splus up to six R-27s). Other air-to-air com-bat configurations include ten R-73s, ortwo R-27ERs or six R-27ETs. For ground at-tack roles, it an carry 24x250kg bombs, or8x500kg bombs, or up to six unguidedrocket pods. The J-11, however, is not con-figured to carry guided bombs or missiles,or Chinese-made weapons.

China has developed an improvedversion of the J-11 designated J-11B withmuch greater Chinese-made content. Mod-ifications on the J-11B include an indige-nous multifunctional pulse-Dopplerfire-control radar reportedly capable oftracking 6~8 targets and engaging 4 ofthem simultaneously; an indigenous digi-



tal flight-control system; Chinese copy ofthe Russian OEPS-27 electro-optic searchand tracking system; a strapdownINS/GPS navigation system; a ‘glass’ cock-pit featuring four-color multifunctionaldisplays (MFD) and a wide-angle holo-graphic head-up display (HUD). The air-craft could carry the Chinese-made PL-8IR-homing SRAAM and PL-12 activeradar-homing MRAAM for air-to-air com-bat. It is expected to have enhanced air-to-surface attack capabilities with theindigenous precision strike ammunitionssuch as LT-2 laser-guided bomb, the LS-6satellite-guided glide bomb, the YJ-91 (Chi-nese copy of the Russian Kh-31P) anti-ra-diation missile, and the TV-guided KD-88air-to-surface missile. The J-11B is config-ured for the Chinese indigenous 7.5t (11.2twith afterburning) thrust engine FWS-10A(less capable copy of the Russian AL-31FN).

China is believed to have been con-ducting preliminary research on its fifth-generation fighter aircraft J-XX. The fighteris described as an advanced F-22-classtwin-engine stealth fighter with extensiveradar cross section (RCS) reduction fea-tures such as internal weapon bay. The twoprimary fighter aircraft design institutes ofthe China Aviation Industries Corporation(AVIC) – Shenyang Aircraft Design Insti-tute (601 Institute) and Chengdu AircraftDesign Institute (611 Institute) – have bothbeen working on their own designs to bidfor the PLA’s contract. In such a case, 611Institute has worked on own advancedfighter aircraft design, possibly based onthe design and technology of its J-10fighter. The Chinese fifth-generationfighter will feature very low RCS, provideexcellent maneuverability and a supersoniccruising speed capability. China may alsoseek potential partners from Russia, Israeland Europe to co-develop avionics and

weapon suites for its 5th-generation fighteraircraft.

H-6H and JH-7A aircraft representedPLAAF’s fighter bomber component dur-ing the flypast show.

The H-6H bomber is the latest pro-duction-standard version of the Soviet-de-signed strategic medium bomber Tu-16Badger that was series produced in Chinaunder a Russian license since 1968. Thebasic version, H-6A, was designed as a nu-clear bomb carrier. In 1985, the PLA Navycommissioned the H-6D missile bomberarmed with two YJ-61 anti-ship missiles,and seven years later, in 2002, the H-6Hbomber entered service with the PLAAFwhich currently has an inventory of 70 H-6-series bombers in seven air regiments.The H-6H is powered by twoWP-8 turbo-jets (Chinese indigenous copy of a Russianequivalent), enabling cruising speeds of850 km/h and a flying range of 6,000 kilo-meters with a 6t payload. It carries twosubsonic highly maneuverable YJ-63 cruisemissiles with a range of 200 km and a 500-kg warhead, or, alternatively, a 9t bombload (various mixes of 250, 500, 1,500, and3,000kg bombs). After China failed to ac-quire the Tu-23M3 strategic bomber as asuccessor to the now outdated H-6H, itlaunched the development of its upgradedversions H-6M and H-6K. The latter fea-tures some radical modifications, includingsix under-wing pylons to carry as manynew land-attack CJ-10A extended-range(up to 1,500km) cruise missiles; two Russ-ian-made D-30KP 12-t thrust turbofan en-gines (these engines would provide thenew H-6K with increased weapon payloadand extended range); a current-generationradar; and a completely refurnished ‘glass’cockpit featuring six large multifunctionaldisplays. The H-6M features four large py-lons fitted under the wings to carry four YJ-81 anti-ship missiles. If necessary, the



bomber may also be able to carry the KD-88 land-attack cruise missile for precisionstrike role.

The JH-7A is the latest version of thebasic JH-7 fighter bomber design that hasbeen in PLAAF service since 1992. The JH-7A was first delivered to the PLA NavalAviation in early 2004, followed by the de-livery to the PLAAF in late 2004. There arecurrently three JH-7/A regiments in thePLA Naval Aviation, and a JH-7A regi-ment in the PLAAF, totaling some 70 ex-amples. The JH-7 is an all-weather,two-seat, twin-engine fighter-bomber inthe same class as the European TornadoIDS and Russian Sukhoi Su-24 Fencer. It isequipped with the JL-10A multi-functionalpulse-Doppler radar and powered by twoWS-9 Qingling turbofans (a Chinese li-censed copy of the British Mk202). The air-craft enables near-ground maneuvering at1,210 km/h, and operates within a range of1,650 km. The JH-7A is fitted with a twin-barrel Type 23-III (a copy of the GSh-23L)23mm cannon. Up to 5,000kg weaponloads and/or drop tanks can be carried oneleven external hardpoints (six underwings, two on wingtips and 3 under fuse-lage). The variant would carry four YJ-81subsonic sea-skimming anti-ship missilesand two PL-8 IR-homing SRAAMs, plus a1,400L drop tank. For surface attack mis-sions, the JH-7A could carry up to twenty250kg low-drag general-purpose, or TV-guided KD-88 air-to-surface missiles, orLT-2 laser guided bombs, or YJ-91 anti-ra-diation missiles.

The most capable combat aircraft inservice with the PLA, the Russian-suppliedSu-30MKK multi-role fighter bomber air-craft was not on view at the parade. TheSu-30MKK approaches the U.S. F-15EStrike Eagle in terms of performance andcapability. It has an impressive combat ra-dius of 1,600km without refueling, which

could be extended to 2,600km with one re-fueling, or 3,500km with another. The Su-33MKK carries latest-generation systemsand a weapons load increased to 8 tons, in-cluding active radar-homing medium-range air-to-air missiles R-77/AA-12Adder, Kh-59ME air-to-surface missiles,Kh-31 anti-ship cruise missiles, Kh-31Panti-radiation missiles and TV-guidedKAB-500Kp glide bombs.

The H-6U aerial refueling tanker air-craft was developed from the H-6 twin-en-gine jet bomber and was accepted into thePLAAF service in 1996, when PLAAF wasrequired to expand its reach to China’s pe-ripheral regions, such as the South ChinaSea and Taiwan Strait. To achieve this tar-get, the PLAAF was desperate in need foran aerial refueling capability that could ex-tend the radius of its combat aircraft. Thenavy version is designated H-6DU. It ap-pears to be converted from existing H-6Danti-ship missile bomber. A total of 12~20examples of the H-6U are believed to havebeen built so far. China was reported tohave obtained some Western-made aerialrefueling equipment which was later usedas a pattern for developing China’s own in-digenous design. The H-6 tanker carries 37tons of aviation fuel inside its tanks,enough to refuel six J-8D-type fighters toextend their radius to 1,200 km from 800km. Its refueling system is compatible withthe J-10 and JH-7 fighter aircraft but doesnot match to the Su-30MKK for whichChina has ordered eight Russian Il-78tankers. The H-6U can transfer 18.5 tons offuel to the fighter aircraft. Its refueling sys-tem consists if two RDC-1 refueling pods,allowing two fighter aircraft to be refueledat the same time.

The JL-8 basic jet trainer aircraft wasjointly developed by the PRC and Pakistanin the 1990s as a successor to the Cessna T-37 jet trainers in the Pakistani Air Force



service. The aircraft is powered by theUkrainian 1.7t thrust AI-25TL turbofan (orits Chinese copy WS-11). In its ground at-tack configuration, there are four under-wing pylons to carry up to 1,000kgpayload, each rated at 250kg. The stationscan carry drop tanks, 23mm cannon pods,unguided rockets, 250kg bombs or two PL-8-type short-range air-to-air missiles. Rus-sia reportedly assisted the PLAAF to buildthe more capable JL-15 (a copy of its Yak-130 trainer jet) powered by Ukrainian AL-222K-25F motors.

The PLAAF’s helicopter componentwas represented by the WZ-9A and Z-8Krotorcraft, which both are variants of Chi-nese copies of the French-designedAS365N and SA321J choppers, respec-tively.

The WZ-9A is the most recent and ca-pable member of the WZ-9 family of attackhelicopters, introduced into the PLAAFservice in 2005. It is powered by two WZ-8A turboshafts (a copy of the French ArrielIC1), and features a nose-mountedday/night sighting pod. The helicopter hastwo weapon pylons to carry 4 (or 8 on theZ-9WA) HJ-8 wire-guided anti-tank mis-siles. Alternatively, the helicopter can carrytwo 12.7mm machine gun pods, or two57mm or 90mm unguided rocket pods, orfour TY-90 IR-homing air-to-air missiles(6km range).

The dedicated attack helicopter WZ-10 is being developed as a successor to theWZ-9A, and it is thought to be in the sameclass as the Agusta A-129 and Tiger. Eightprototypes have been built and now un-dergoing test and evaluation. An observa-tion unit consisting of a forward lookinginfrared (FLIR), a low-light television and alaser rangefinder/designator mounted ona steerable platform at the nose of the heli-copter. All the critical systems on the heli-copter have armor protection. The

electronic countermeasures (ECM) suiteconsists of radar warning receiver (RWR),laser warning receiver, infrared jammerand chaff/flare decoy dispenser. The heli-copter is thought to be fitted with a ‘fly-by-wire‘ (FBW) control system, and a modernglass cockpit with multifunctional display(MFD) screens. The helicopter is fitted witha 30mm cannon mounted under the nose,this being controlled from the pilot’s hel-met-mounted sight. A new-generationanti-tank guided missile (ATGM) HJ-10 iscurrently in development. The missile isthought to be comparable to the U.S. AGM-114 Hellfire. The helicopter can carry up toeight such missiles under the stub wingsfor anti-armor role. Alternatively, the heli-copter can carry unguided rocket pods forground attack, or TY-90 short-range air-to-air missiles for air combat. The Z-10 proto-type is powered by two Pratt & WhitneyCanada PT6C-67C turboshaft engines ofwhich ten have been procured by China forits Z-10 program. The WZ-9A with Chineseindigenous engine WZ-9 is rapidly ap-proaching full-scale series production ma-turity.

The PLA Air Force introduced the Z-8K as a dedicated search and rescue (SAR)helicopter in 2007. It is powered by threePratt & Whitney Canada PT6A-67B tur-boshaft engines. The Z-8K has a hoist withwinch and scoop fitted externally abovethe starboard side cabin door for rescuemissions. For transport missions, the heli-copter can carry 27 armed soldiers, or 15patient litters and a medical staff, or5,000kg cargo externally on sling.

The most capable combat helicoptersin service with the PLA Air Force, theRussian-supplied Mi-171 and Mi-17V-5/7were not to be seen during the parade.

Intuitively enough, the fixed wing air-craft and helicopter examples demon-strated during the 60th national day



military parade in Beijing more reflect ac-complishments by the Chinese aeronauti-cal research and design community thanthe current status of the PLAAF’s fleet. Inactual fact, however, the PLAAF’s fleet isto a large degree obsolete and worn-out.Especially, its 1300-aircraft fighter fleetonly comprises 300 examples of the rela-tively current-generation fighter types seenduring the October 1 air show (24 J-7Gs, 20J-8Fs, 140 J-10s and 116 J-11s). With the 32Su-27s, this figure would amount to 332 ex-amples or 26 percent of the PLAAF’sfighter fleet, the remaining 74 percentbeing technologically obsolete examples ofthe J-7 and J-8 series. Of the existing fleet of550 fighter bombers in the PLAAF service,the JH-7A bombers shown off at the paradeonly account for 70 examples or 13 percent.With the 73 Su-30MKKs, the fleet of rela-tively advanced attack aircraft would make143 examples, or, again 26 percent, the re-maining 74 percent being antiquated bymodern standards Q-5C/D ground-attackfighters.

Of the all 12 fixed wing and rotarywing aircraft types seen during the na-tional day parade, only 4 fixed wing air-craft, specifically the J-8F, JH-7A, J-10 andJL-8 could be considered indigenous (to alimited extent, though) Chinese designs.The J-8F was developed by way of modify-ing and improving, under a Russian li-cense, the Soviet-era MiG-21F-13 fighter jet,and it was based on the layout of the SovietSukhoi Su-15 Flagon-A fighter. The J-10was developed around the Israeli IAI ‘Lavi’experimental fighter with assistance fromforeign engineers. All the four ‘indigenous’Chinese designs involve foreign-suppliedengines (or their reverse engineeredcopies), subsystems and weapons. Theother designs are ‘indigenous’ to an evenlesser extent; the AEW&C aircraft designswere derived from foreign-developed

transports (or their reverse engineeredcopies), the H-6H bomber and H-6U aerialrefueling tanker are modified licensedcopies of the Tupolev Tu-16, the J-7Gfighter is a redesigned Chinese copy of theSoviet-era MiG-21F-13/Fishbed-C super-sonic jet fighter, the J-11 is a licensed copyof the Cu-27SK, and, finally, the WZ-9Aand Z-8K helicopters are variants of Chi-nese copies of the French designs AS365Nand SA321J, respectively. As well as assis-tance from foreign engineers and licensedproduction in China, direct cloning of for-eign designs and industrial spying wereheavily involved in the development ofthese aerial vehicles. Depreciation of thePLAAF’s fleet and China’s ambition tohave a modern air force equipped with in-digenous current-generation aircraft andaerial weapons systems, supported by itsgrowing financial capabilities and the re-fusal by the United States and other devel-oped nations to provide Beijing withadvanced military technologies and know-how – this all may well be the rationale be-hind China’s ‘by all means or foul’ policy.Such a pragmatic approach would be fullyjustifiable from the perspective of China’stop-priority national interests. The USSR,in its own good time, pursued a similarpolicy of competitive intelligence and di-rect copying of foreign aeronautical de-signs. Especially, the Tu-4 strategic bomberwas developed as a reverse engineeredcopy of the Boeing B-29 bomber. China em-ploys a variety of patterns for copying for-eign designs. One demonstrative examplemight be the J-11B, the Chinese clone of theRussian Su-27SK. In 1995, the Russiansagreed in principle to allow the PRC tobuild the Su-27SK single-seat fighter lo-cally under license. In 1996, Sukhoi Com-pany (JSC) and SAC entered into a contractfor the co-production of 200 Su-27SK fight-ers as the J-11. Under the terms of the



agreement, Sukhoi/KnAAPO would sup-ply the aircraft in kit form to be assembledby SAC. It was reported that Russia alsoagreed to help the PRC gradually increasethe proportion of Chinese-made content onthe J-11, so that SAC could eventually pro-duce the aircraft independently. In No-vember 2004, however, Russian mediareported that the J-11 production hadstopped after about 100 examples werebuilt. According to the report, the Chineseside had requested Sukhoi Company tostop deliveries of the assembly kits. Thecontract had been terminated when half-completed, and the Chinese copy, the fullyindigenously built J-11B, eventually hadbeen brought to the picture. In response toaccusations of copyright abuse and breachof terms of the contract, the Chinese sidethreatened to refuse awarding furtherhighly lucrative contracts. Another exam-ple is the Kh-55 strategic cruise missile,which is now being manufactured in Chinaunder local designation CJ-10A, a fewyears after an amount of such missiles wasbought by China from Ukraine. The thirdexample could be the Ukrainian-suppliedT-10K experimental aircraft around whicha naval fighter is being developed for fu-ture Chinese aircraft carriers.

The PRC has over the past decademade major achievements in the develop-ment of its scientific and technologicalbases, especially with respect of avionics.This allowed China to develop and launchdomestic production of radar equipmentfor AEW&C applications, J-10 and JH-7fighter aircraft, upgraded/modified ver-sions of the J-7, J-8B and H-6 fixed wing air-craft, and Z-8 and WZ-9 helicopters.Additionally, 100-percent Chinese madeaircraft J-10B and J-11B have been broughtinto being. Also, China has achieved agreat success in the development of preci-sion-guided air-launched weapons: the PL-

8 SRAAM, PL-11/12 MRAAM, CJ-10strategic cruise missile, YJ-63 and KD-88air-to-surface missiles, YJ-81 anti-ship mis-siles, laser and satellite-guided bombs LT-2 and LS-6, and the helicopter-launchedATG missile HJ-10. Development effort hasbeen in progress for the strategic UAV de-sign WZ-2000 that would be similar to theUnited States’ Global Hawk, as well as forthe future fifth-generation J-XX fighter,special-mission WZ-10 attack helicopter,and the Z-15 multirole helicopter. The de-velopment level of China’s engine buildingindustry is still lagging behind other sec-tors’, still, this gap has been graduallybridged.

Ukrainian-Sino cooperation in mili-tary aeronautics has been restricted to sup-plies of individual examples, subsystemsand components, and the transfer/sellingof licenses and know-how. Especially thisis about engines (and related production li-censes) for the JL-8 and JL-15 trainers, mo-tors for Russian-supplied Mi-171 andMi-17B-5/7 helicopters, maintenance tech-nology for the AL-31FN engine, R-27/AA-10 Alamo medium-to-long-range air-to-airmissiles, a shipment of Kh-55 cruise mis-siles and the experimental aircraft T-10K.

The Center for Army, Conversion andDisarmament Studies recently expressed asuggestion to boost this cooperation, par-ticularly with regard to co-production ofthe JL-15 trainer aircraft (as has alreadybeen proposed by the PRC) and the possi-bility of China assisting Ukraine in bring-ing up to modern standards the UAF’sSu-27 fighter fleet.

ConclusionsFirst, the October 1 military flypast

show in Beijing involved 151 Chinese-builtaerial vehicles of 12 types: two AEW&Cplatforms (KJ-2000 and KJ-200), four fight-



ers (J-7G, J-8F, J-10 and J-11), two attack air-craft (H-6H bomber and JH-7A fighterbomber), one aerial refueling tanker (H-6U), one trainer aircraft (JL-8), one combathelicopter (WZ-9A) and one SAR helicop-ter (Z-8K). Of these 12 types, only fourcould be considered indigenous (to a lim-ited extent) Chinese designs. These are theJ-8F, J-10, JH-7A and JL-8, which, however,include foreign-designed (or reverse engi-neered) key components such as engines,selected mission systems and weapons.Other designs are indigenous to an evenlesser extent; the AEW&C aircraft designsare built around a foreign-designed trans-port aircraft or its Chinese copy, thebomber, aerial tanker and fighters aremodified versions of foreign suppliedequivalents, and the helicopters are reverseengineered copies of foreign-suppliedcounterparts.

Second, the PRC has over the pastdecade made major achievements in thedevelopment of its scientific and techno-logical bases, which allowed it to developand launch domestic production of theKLJ-2000 and KJ-200 AEW&C aircraft, J-10and JH-7 fighter aircraft, upgraded/modi-fied versions of the J-7, J-8B and H-6 fixedwing aircraft, and Z-8 and WZ-9 helicop-

ters, J-10B and J-11B fighters; precision-guided air-launched weapons: the PL-8SRAAM, PL-11/12 MRAAM, CJ-10 strate-gic cruise missile, YJ-63 and KD-88 air-to-surface missiles, YJ-81 anti-ship missiles,laser and satellite-guided bombs LT-2 andLS-6, and the helicopter-launched ATGmissile HJ-10. Development effort has beenin progress for the strategic UAV designWZ-2000, the future fifth-generation J-XXfighter, special-mission WZ-10 attack heli-copter, and the Z-15 multirole helicopter.

Third, military-technical cooperationbetween Ukraine and the PRC in the fieldof military aeronautics has been restrictedto supplies of individual examples, sub-systems and components, and the sellingof licenses and know-how (engines for theJL-8 and JL-15 trainers, motors for theRussian-supplied Mi-171 and Mi-17B-5/7helicopters, R-27/AA-10 Alamo medium-to-long-range air-to-air missiles and so on).The Center for Army, Conversion and Dis-armament Studies recently expressed asuggestion to boost this cooperation, par-ticularly with regard to co-production ofthe JL-15 trainer aircraft and the possibilityof China assisting Ukraine in the UAF’s Su-27 fighter fleet upgrade.



1.As geopolitical situation aroundUkraine has been going from bad to worse,and given the emergence of fundamentallynew threats and challenges, the transitionfrom cooperation on a project-by-projectbasis to strategic partnership with the Peo-ple’s Republic of China holds the promiseof huge benefits in terms of politics, econ-omy, military technology and defense se-curity, all the more so as there are noconflicts or points of disaccord in relation-ships between Ukraine and the PRC.

2.Being a powerful, independent cen-ter of influence of global proportions, thePRC, by virtue of its technological andgeopolitical ambitions, has an apparent in-terest in Ukraine. Even though the differ-ence in mentalities between the Ukrainianand Chinese nations remains wide enough,a sustainable tendency towards a Eu-ropeization of China is making this gapsomewhat smaller. Furthermore, there is alarge enough population of Soviet Schooladherents remaining in China, which feedsa considerable amount of interest inUkrainian culture in general and Ukrain-ian universities in particular.

3.The PRC might potentially act as se-curity guarantor for Ukraine. AlthoughChina’s interest in Ukraine is primarilytechnological, another aspect of that inter-est is that Kiev never attaches any politicalstrings or requirements to joint projects insensitive sectors and, furthermore, Ukraineis a potent potential market for Chinesegoods. The PRC pursues a vigorous yetwell thought-out, thoroughly balanced andconsistent foreign policy, and, for this rea-son, it is very unlikely to agree to provideassurances of any kind.

4.A characteristic of Chinese leader-ship is that they are disinclined to take fastdecision but, rather, tend to thoroughly ex-amine and weigh in the balance all the op-tions available before determining anacceptable response. Key factors here, asbefore, are a partner’s consistency and ahigh enough level of contacts betweenupper reaches of political establishments,not excepting the supreme leaders of thetwo states. China’s policies towards Pak-istan might provide for Ukraine an impor-tant demonstrative example about howproblematic geopolitical issues should bedealt with. By reinforcing Pakistan, Chinathereby weakens India whom it considersto be its rival in the region. The possibilityis not fully ruled out that China’s territo-rial ambitions and general geopolitical ex-pectations with regard to the Far Eastmight spur Beijing to begin actively rein-forcing Ukraine as an anti-Russian centerof influence on the Western front. Many ex-perts believe that China has alreadylaunched a cautious advance on Russianinterests. The important positive side toUkraine’s rapprochement with China isthat it does not affect or run counter to itsrapprochement with Russia.

5.The PRC has already outpacedUkraine in the development and produc-tion of some defense technologies, mostparticularly fighter aircraft, SAM weaponsand tactical/operational missile systems.For Ukraine, building an indigenous multi-role short-range missile system is a top-pri-ority challenge in homeland defensesystem. Ukrainian designers, while havinga history in the field of strategic missile sys-tems, do not have any experience in the de-


CACDS expert conclusions

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velopment of tactical/operational missileweapons. For this reason, relevant skillsand technology transfers with the PRCwould be quite justifiable and feasible. In-tuitively enough, that issue must be ap-proached with great caution, as someproblems may arise here, both in the con-text of limitations stemming from the in-ternational Missile Technology ControlRegime (MTCR) and at the level of rela-tionships with the United States. By thevery fact of seeking such an opportunity inrelations with the PRC, Kiev sends a mes-sage to international community thatUkraine deserves better attitude on behalfof the key players of global politics whotend to take little if any account ofUkraine’s vital interests.

6. Cooperation in military technologywith China would allow Ukraine to buildup its defense capacity and technologicalcapabilities by carrying out a range of mu-tually beneficial projects. The PRC has re-inforced substantially its research andmanufacturing potentialities, thereby en-abling itself to go away from onetime de-pendence upon Russia as defense supplier,and, furthermore, to generate alternativesolutions in a number of military technol-ogy areas. Ukraine must create an environ-ment for some of these new Chinesetechnologies to be employed, on a mutu-ally beneficial basis, for Ukrainian ArmedForces re-equipment and re-weaponingprograms as well as for joint projects onthird-country markets.

7. The PRC has, year by year, beenevolving into a powerful global defense

supplier, exporting high-tech weapons sys-tems and items of defense equipment, andcontinuously adding new products andservices to its defense export portfolio. Pak-istan, a onetime traditional military-tech-nological cooperation partner of Ukraine,has now preferred China as its closest part-ner, most notably in the tank/AFV andATGW areas of military technology. Thisreflects a more inclusive tendency ofUkraine to be gradually ousted from its tra-ditional markets in Asia and Africa byChina, unless a framework for cooperationwith China on third-country markets --particularly through advancing joint proj-ects – can be established. It, however, mustbe appreciated that the PRC, in contrast toIndia, has taken very cautious approach to-wards selecting joint projects with foreignpartners.

8. Further advancement of Ukrain-ian interests in China calls for an intensifi-cation of bilateral contacts at the topnational level. In this particular context, notonly is the issue of lobbying for coopera-tion with China of paramount importance,it also is a critical precondition for and partand parcel of Ukrainian-Chinese friend-ship, providing that there is an intention todevelop the friendship into strategic part-nership. At this point in time, the level ofcontacts between top leaders of the twocountries is apparently insufficient, whichin no way facilitates the task of bringingthe relationships to a strategic level. Iner-tia in relationships between top leaders ofthe two countries is the main impedimentto progress in Ukrainian-Sino relations.


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ContentsIntroduction.

Why China?................................................................................2

First chapterIn search of comprehensive guarantees................................5

Second chapter.

Place of Ukraine in the China-Ukraine-Russia triangle.............................................13

Third chapter The specifics of China’s policies towards regional markets.......................................................35

Forth chapterMilitary-Technical Cooperation between Ukraine and China: Directions and Cooperation Patterns.......................................................43

Fifth chapterChina’s military parade as a mirror of its global ambitions ...........................................................57

CACDS conclusions.................................................................71

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Business

UKRAINE – CHINA: from Project-to-Project Cooperation to Strategic Partnership