Today's D Brief: FBI, MI5 on the 'long-term threat' of China; Russian advances halt in Ukraine; US Army's personnel crisis; And a bit more.

Top U.S. and British intelligence officials are sounding the alarm bells over the long-term threat posed by China, which they say is quickly learning from Russia’s botched invasion of Ukraine as they look to bring Taiwan closer in the coming years. Those appear to be part of a brief flurry of China-related messaging ahead of a big G20 meeting in Bali tomorrow. And it included a rare joint appearance Wednesday by FBI Director Chris Wray and British MI5 chief Ken McCallum speaking to business leaders in London. Here are a few highlights:

“It’s the Chinese government that poses the biggest long-term threat to our economic and national security,” Wray said. That involves “both of our nations, along with our allies in Europe and elsewhere,” he said. “The Chinese government poses an even more serious threat to Western businesses than even many sophisticated businesspeople realize. So, I want to encourage you to take the long view as you gauge that threat and as you plan to meet it.”

“The Chinese government is set on stealing your technology,” Wray said, “and using it to undercut your business and dominate your market.” The impacts are already felt in companies ranging from “Fortune 100s to start-ups, folks that focus on everything from aviation, to AI, to pharma. We’ve even caught people affiliated with Chinese companies out in the U.S. heartland, sneaking into fields to dig up proprietary, genetically modified seeds,” the director said. Chinese hackers even tried “to try to steal COVID research from one of our universities,” Wray said. 

According to MI5’s McCallum, “The aim here is not to cut off from China,” which he said represents “one fifth of humanity, with immense talent…our aim is to make conscious choices on issues that are rarely binary. We want a UK which is both connected and resilient.”

And should China invade Taiwan, “it would represent one of the most horrific business disruptions the world has ever seen,” Wray said. “I’m confident in saying that China is drawing all sorts of lessons from what’s happening with Russia and its invasion of Ukraine—and you should, too.” 

Director Wray also said the FBI has “seen China looking for ways to insulate their economy against potential sanctions, trying to cushion themselves from harm if they do anything to draw the ire of the international community,” with the Western response to Russia’s invasion close on the mind of Chinese officials. “In our world, we call that kind of behavior a clue,” he said. “Just as in Russia, Western investments built over years could become hostages, capital stranded, supply chains and relationships disrupted. Companies are caught between sanctions and Chinese law forbidding compliance with them. That’s not just geopolitics. It’s business forecasting.” 

Wray’s advice to business leaders: “I would encourage everyone to work with the two agencies up here. We can arm you with intelligence that bears on just what it is you’re facing,” he said, referring largely to corporate espionage and cyber risks. And finally, he said, “I’d ask you to take the long view.” That means “Looking past the nearest earnings report, to maximizing the value of the company over the course of years, long after today’s management team may have moved on. Consider that it may be a lot cheaper to preserve your intellectual property now than to lose your competitive advantage and have to build a new one down the road.” Read the rest of Wray’s message, here. 

By the way: Chinese officials are targeting “leaders at the U.S. state, local, tribal, and territorial levels” with influence operations and “seemingly benign business opportunities,” America’s National Counterintelligence and Security Center said Wednesday in a new warning. This seems to largely involve financial incentives and alleged nonprofit institutions, including “many quasi-official entities or proxies involved in united front work," like the Chinese People’s Association for Friendship with Foreign Countries and the National Association for China’s Peaceful Unification. 

NCSC’s advice to U.S. officials and entrepreneurs: 

• “Exercise vigilance when engaging with foreign entities.”
• “Know your partners and who you are doing business with.”
• “Insist on transparency in all agreements.”
• “Share experiences with others to develop best practices.”
• And “Maintain enduring connectivity with U.S. authorities.” Read more (PDF), here. 

China’s reax to all this appears to be indignation and deflection, insisting that it’s not China, but the U.S. that is “the biggest threat to world peace, stability and development,” Foreign Ministry spokesperson Zhao Lijian said Thursday in Beijing. “We urge this U.S. official [that is, FBI Director Wray] to have the right perspective, see China’s developments in an objective and reasonable manner and stop spreading lies and stop making irresponsible remarks,” said Zhao. 

He also said MI5’s McCallum was “simply projecting [Britain’s] own dishonorable behavior onto China,” and that he should “come out of the dark room and see the sunshine” instead of creating “imaginary enemies.” The Associated Press has more from Beijing, here.

From Defense One

After Criticism, Army Reinstates High School Diploma Requirement as Recruitment Plummets // Caitlin M. Kenney: Service leaders offered to welcome more applicants without degrees, amid the “most challenging” recruiting environment since the Vietnam War.

Welcome to this Thursday edition of The D Brief, brought to you by Ben Watson with Jennifer Hlad. If you’re not already subscribed to The D Brief, you can do that here. And check out other Defense One newsletters here. On this day in 1946, Howard Hughes was nearly killed when his experimental XF-11 plane crashed into a neighborhood in Beverly Hills. The scene was recreated for the 2004 film, “The Aviator,” and you can find that on YouTube, here.

For the first time in Vladimir Putin’s Ukraine invasion, the Russian military did not claim any territorial advances over the past 24 hours, analysts at the Institute for the Study of War write in their latest daily assessment. That’s a first in 133 days of fighting, ISW notes. “However, Russian forces still conducted limited and unsuccessful ground assaults across all axes on July 6.” But overall, they appear to be effectively maintaining that alleged operational pause following a grinding rush to take full control of Ukraine’s Luhansk oblast, which concluded around July 3.
Update: In the lower parliament known as the Duma, Russian lawmakers just advanced those new laws that put the country on more of a wartime economic footing, compelling overtime and compliance with state-run industries. “The law must still be sent to the Federation Council before it reaches Russian President Vladimir Putin and is officially published, but the Kremlin is likely seeking to use the law to leverage domestic labor to maximize economic output and prepare for protracted operations in Ukraine,” ISW warns. More here.
Additional reading: 

• “Ukraine’s military plans to limit free movement to make conscription easier,” via the Guardian, which reported Wednesday from Kyiv that very few Ukrainian politicians actually like this plan, and it’s probably going to get scrapped because of the backlash it has caused; 
• “In Ukraine, U.S. Veterans Step In Where the Military Will Not,” via the New York Times, reporting Sunday; 
• “The West should help Ukraine get more Russian-made weapons and ammo from around the world, a think tank says,” via NBC News, reporting Wednesday from a report by the Foundation for Defense of Democracies; 
• And “France to Nationalize Power Company EDF to Help It Combat Europe’s Energy Crisis,” via the Wall Street Journal, reporting Wednesday from Paris. 

In a new first, the British Royal Navy says it intercepted an alleged arms shipment from Iran to Yemen, according to the U.K. Embassy in the United Arab Emirates. The Associated Press has a bit more from Dubai, here.

ISIS in Africa says it was behind a prison break in Nigeria’s capital that freed more than 400 prisoners on Tuesday night. Local officials suspect Boko Haram fighters spearheaded the assault, which led to 879 inmates escaping—443 of whom are still at large, Reuters reported Wednesday afternoon. 

Lastly: Some 60,000 American soldiers who refused to vaccinate amid a global pandemic are now cut off from some of their Guard and Reserve benefits, Military.com reported Wednesday; continued refusal could earn them “additional adverse administrative action, including separation,” an Army spokesman said.
And that news comes amid a much larger recruiting challenge for the country’s largest service—by some accounts, the worst since abolishing the draft in 1973, with recruiters so far reaching only 40% of the service’s annual goal with a mere three months remaining. Army officials even briefly considered dropping the high school graduation requirement to boost recruiting, but that effort has since been abandoned.
About the Covid vaccine refusers: An estimated 40,000 National Guard and 22,000 Reserve soldiers say they won’t get vaccinated against Covid, the virus that’s believed to have killed more than 6 million people around the globe, including more than a million in the U.S. alone. “We're going to give every soldier every opportunity to get vaccinated and continue their military career,” Army Guard Director Lt. Gen. Jon Jensen told Military.com in an email. “We're not giving up on anybody until the separation paperwork is signed and completed.”
Reminder: Well before the pandemic, the military had already mandated nine different vaccinations for new recruits, and an additional eight others depending on assignments. That list includes vaccinations for the Adenovirus; Hepatitis A and B; Influenza; Measles, mumps, rubella; Meningococcal; Poliovirus; Tetanus-Diphtheria; and Varicella. The eight location-dependent vaccines cover Anthrax (which once upon a time felt to your D Brief-er like injecting peanut butter); Haemophilus influenzae type B; Japanese encephalitis; Pneumococcal; Rabies; Smallpox; Typhoid fever; and Yellow fever.
A bit more on that personnel crunch: Just 23 percent of 17- to 24-year-old Americans are eligible to enlist in the Army without a waiver of some kind, and that’s down from 29 percent in recent years. What’s more, only 9 percent of those are willing to join the military—and that’s the lowest share in 15 years, our colleague Caitlin Kenney reported Wednesday.
Related reading: 

• “Bigger military bonuses might be on the way to help with recruiting, retention,” via Military Times, reporting in mid-June;
• And “Every branch of the military is struggling to make its 2022 recruiting goals, officials say,” via NBC News, reporting in late June.