In Beijing, visiting U.S. officials raised concerns that China is continuing to transfer missile technology, the Washington Post reports. The U.S. delegation, led by Under Secretary of State John Holum, met with senior Chinese arms control and military officials during talks meant to encourage China to join the Missile Technology Control Regime [MTCR]. A U.S. official said two of the recipients were Iran and Pakistan.

China is closely allied with Pakistan, its western neighbor, while having hostile relations with India, Pakistan's adversary. U.S. officials are also concerned that missile technology transfers to Iran would enable Tehran to threaten or interdict commercial shipping or military transit for the U.S. navy and its Arab allies. In the past, the Post adds, China has denied it has made such transfers or argued that such sales were permissible because they were "dual use" technologies that can also be used for commercial purposes. Beijing made no public response to the Holum delegation's query.

China's military long-term modernization program includes cuts of 500,000 troops to free up money for high-technology weapons development, according to the Pentagon report to Congress, "Future Military Capabilities and Strategy of the People's Republic of China," the Washington Post reports. In addition, China is developing long-range air-to-air missiles specifically to destroy U.S. AWACS aircraft, and has already acquired advanced missiles that could threaten those aircraft. The report adds, one of China's main initiatives is centered on upgrading its electronic warfare capability.

China's military research departments have called for tighter controls of exchanges of personnel and information, the South China Morning Post reports. The call came after Hua Di, an expatriate missile expert working at Stanford University, was detained by Chinese authorities while visiting his family. Chinese scientists hope the case will not effect the growing number of scientific exchanges with foreign countries. "It is essential to protect the exclusive rights of information and encourage the development of new technologies," said Chen Xiaozhu, a Ministry of Information official. [Editor's note: Thousands of Chinese science and engineering students and graduates currently study and work in the United States. China is known to have the largest foreign spy operation in the U.S..]

China plans to launch its first network of state-of-the-art optical and radar satellites, Xinhua News Agency reports. The network, made up of four optical satellites and two radar satellites, will provide around-the-clock environmental and disaster monitoring. [Editor's note: These satellites also have significant military applications, such as all-weather targeting and surveillance of naval vessels throughout the western Pacific.] The Chinese government plans the first launch in early 1999.

The U.S. Microsoft Corporation will build a research lab in Beijing, which will cost at least $80 million over the next six years, the Far Eastern Economic Review reports. The lab will be the first in Asia and the second outside of the United States.

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