Japanese Intelligence Tells Pentagon China Engaged in Multi-Year Takeover Attempt of Senkaku Islands

Tokyo spy agency warns Beijing also bolstering forces for military control of oil shipping routes

A Chinese surveillance ship, right, sails near the biggest island in the disputed Senkaku Islands in 2013 / AP
November 23, 2016

TOKYO—China is escalating a campaign of military maritime coercion against Japan's Senkaku Islands, according to Japanese intelligence data disclosed as part of a joint Pentagon-Japan research program.

Additionally, China is doubling the size of its coast guard forces over the next five years to prevent the disruption of oil supplies that travel from the Middle East through the Indian Ocean and South China Sea, according to Pentagon-sponsored reports about the joint U.S.-Japan collaboration. Two reports produced by a contractor for the Pentagon's Office of Net Assessment, a secretive research group, provide a rare glimpse of Japanese intelligence assessments of Chinese military activities in the East China Sea and South China Sea.

In addition to adding large numbers of new coast guard and navy ships to its fleets in Southeast Asia, China is building military facilities on newly created islands in the South China Sea. It will eventually militarize the East China Sea using floating oil rig platforms, according to analyses provided by Japan's Cabinet Intelligence and Research Office, known as CIRO.

According to CIRO, China has greatly increased unilateral oil and gas development near the line separating Chinese and Japanese waters near the Senkakus.

The number of oil rigs operating in the area increased from four to 16 between 2013 and 2015. CIRO believes the rigs will be used for military purposes because the large number of sea platforms is not economically practical.

As part of a plan to increase its coast guard presence, in 2015 the Chinese boosted the number of large ships used by the maritime law enforcement service by 33 percent. The coast guard is on track to double in size by 2019, according to the defense contractor reports produced for the Office of Net Assessment, which reports to Defense Secretary Ash Carter.

However, Japanese intelligence identified weaknesses in China's coast guard that render it less powerful than its Japanese counterpart due to a lack of trained personnel needed to operate the new ships. CIRO also identified maintenance problems with the new Chinese ships, indicating they were poorly constructed.

China is working to address the shortcomings, the spy service said, by adding larger and better armed warships to its coast guard forces and building a new base near Wenzhou, a port on the Chinese coast that will give Chinese vessels easier access to the disputed Senkakus, which China claims as its territory and calls the Diaoyu Islands.

Briefing slide from Japan's CIRO intelligence agency presented during a Pentagon with Japanese officials
Briefing slide from Japan's CIRO intelligence agency presented during a Pentagon with Japanese officials

The Pentagon reports from October 2015 and March 2016 were produced as part of an effort by the Office of Net Assessment to help Japan set up a net assessment office of its own. The Japanese office would gauge the strengths and weaknesses of combined U.S. and Japanese military forces and how they would fare in a military conflict with China.

The project to bring together U.S. and Japanese defense and military experts is called the "Task Force on Enhancing the Japan-U.S. Alliance" by the Tokyo government. It is part of the Obama administration strategy to bolster forces and alliances in the Far East known as the Asia rebalance or pivot.

The collaborative net assessment project has been underway for two years, with meetings in May 2015, October 2015, and March, but the plan for a Japanese net assessment office has run into problems in Tokyo. Senior leaders of the Japanese government recently decided against setting up a separate office for net assessments, according to U.S. and Japanese officials.

The two internal reports on the task force's work were obtained by the Washington Free Beacon and contain briefing slides labeled "confidential," although the reports are unclassified. They are based on information provided by CIRO, a part of Japan's Cabinet Secretariat, the administrative unit under Japanese Prime Minister Shinzo Abe.

The uninhabited Senkakus, located south of Japan's main island and north of Taiwan, remain the focus of an ongoing tug-of-war between Japan and China. China in recent years has stepped up aggressive naval and coast guard activities near the islands in a bid to seize control.

The United States has sided with Japan in the dispute, announcing more than once in recent years that the Senkakus are covered by the U.S.-Japan defense treaty. The American announcements are an indication that any attempt by China to take control of the islands using military force could trigger a confrontation.

The Pentagon reports contradict public statements by Obama officials that the Asia pivot is not directed at countering China's military assertiveness in the South and East China Seas.

James Baker, the director of the Office of Net Assessment, told the task force in October that Japanese leaders' confidence in U.S. support is "eroding" and that there are strains in the U.S.-Japan alliance.

Cmdr. Gary Ross, a Pentagon spokesman, declined to comment on what he termed "private, bilateral conversations."

"We continue to strengthen defense cooperation with Japan across a range of areas," Ross said. "Through implementation of the 2015 Guidelines for U.S.-Japan Defense Cooperation, we will continue to modernize the U.S.-Japan Alliance."

Jacqueline Deal, president of the Long Term Strategy Group, which produced the reports, said the documents were part of a Pentagon contract to "provide detailed reports on the meetings between the United States and the Japanese government."

"The reports were never published," Deal stated. "They were submitted only to the Office of Net Assessment. The portions of the meeting during which the Japanese materials were disseminated were unclassified."

CIRO analyst Yoshihiro Mukaiyama, who provided intelligence briefings to the task force, confirmed the exchanges were underway but declined to comment further.

"Our office does communicate with our U.S. government counterparts in various ways, but we cannot disclose or comment on any further details," Mukaiyama said in an email.

According to one of the reports, Japanese intelligence believes the Chinese maritime militia "has been increasingly involved in dangerous incidents at sea and has also been increasingly integrated with the [Chinese navy] and [Chinese coast guard] through joint exercises, operations and command and control technology and facilities."

Recent Japanese war games "all centered around PRC attempts to take over the Senkakus," the report noted.

Adm. Scott Swift, commander of the U.S. Pacific Fleet, said last week he is concerned about China's naval buildup, including in the coast guard and maritime militia.

"Let’s be careful to not characterize them as, you know, a rag-tag group of fishermen," Swift told reporters on Nov. 18, adding that the maritime militia is "well organized" and "structured."

Chinese maritime militia vessels were involved in harassment of a Navy surveillance ship, attempting to disrupt its towed listening equipment.

Swift also noted that China's coast guard has refused to join with a U.S.-China code for unplanned encounters at sea.

Retired Navy Capt. Jim Fanell, a former Pacific Fleet intelligence director, said China is trying to take control of the Senkakus and is preparing for a war.

"It is perfectly clear to me that the PRC has tightened the noose around the Senkakus since September 2012," Fanell said.

Incursions by Chinese coast guard and navy ships into the contiguous zone and territorial limits of the Senkakus have increased in scope and frequency, he said. Additionally, China is increasing the number of navy warships stationed in the East China Sea and transiting into the western Pacific. Military flights near the islands have also increased.

"You get the sense that the PRC is preparing its military forces for the 'short, sharp war' that they have written about," Fanell said.

Abe, the Japanese prime minister, met in New York last week with Donald Trump amid concerns the new president will alter the close U.S.-Japan alliance. During the presidential campaign, Trump called on Japan to pay more for the 85,000 American military personnel stationed in the country. He has said the United States could "walk away" from its defense commitments to Japan, which has been limited in developing military forces by its pacifist post-war constitution.

First set up in 2014 to assess the military balance against China, the joint U.S.-Japan program was the idea of Andrew Marshall, the long-time director of the Office of Net Assessment who was forced into retirement last year. Marshall arranged the task force with Shigeru Kitamura, director of cabinet intelligence and Japan's most senior intelligence leader.

The exchanges have included high-level Japanese officials, including Deputy Chief Cabinet Secretary Kazuhiro Sugita, who took part in an October 2015 meeting of the task force in Tokyo.

The program is controversial in Japan, where tensions between defense, foreign affairs, and intelligence agencies have surfaced over CIRO's leadership role in the task force.

The Ministry of Defense and Ministry of Foreign Affairs currently oppose the CIRO-led effort to create a net assessment office due to concerns CIRO is ill-suited for the task. CIRO is largely staffed by officials from Japan's National Police Agency, a law enforcement agency that critics say lacks the analytical and strategic assessment capabilities needed for military assessments.

"It would be like the FBI doing strategic military assessments for the Defense Department," said a Japanese government source.

A second Japanese government source said CIRO officials have clashed with defense and foreign ministry officials who had been excluded from access to CIRO information. However, CIRO has played a more constructive role in information sharing under Japan's new national security council structure.

"They've improved a lot," the second source said.

Japan's other intelligence units include the Defense Intelligence Headquarters, part of the defense ministry, and the foreign ministry's intelligence and analysis service.

The three agencies traditionally have been bureaucratic rivals in a manner similar to the rivalry between the CIA and FBI.

The contractor reports reveal that the October 2015 meeting involved officials from CIRO, the foreign ministry, and the defense ministry. "These three bureaucratic bodies CIRO [Ministry of Defense] and [Ministry of Foreign Affairs] had never before engaged in such a cooperative effort," the report said.

During two joint meetings in October and March, Mukaiyama, the CIRO analyst, disclosed detailed intelligence information on both Chinese and Japanese maritime forces.

Mukaiyama, who personally has conducted intelligence briefings for Abe, stated that China's coast guard is engaged in an "intimidation campaign" around the Senkakus that has been carried out in five phases.

The first period stretched from September 2012 to July 2013 when Chinese vessels entered waters surrounding the Senkakus in an apparently unorganized manner.

Incursions became more organized from July 2013 to October 2013 as two Chinese maritime militias were folded into the coast guard. Then from November 2013 to December 2014 a predictable pattern emerged, involving sorties of three ships that would intrude into nearby Senkaku waters, each time including at least one large ship of 3,000 tons in displacement.

Throughout 2015, the Chinese dispatched newly commissioned coast guard vessels of over 3,000 tons to the Senkakus.

From December 2015 through the spring of this year, China began sending navy warships with the coast guard vessels in groups of three or four ships that included at least one former navy frigate.

Additionally, beginning in Nov. 2015 the Chinese navy began sending intelligence-gathering ships near the Senkakus for the first time. CIRO determined that the warships now with the coast guard were still under the Chinese navy's control.

Briefing slides used during CIRO presentations disclosed that Chinese vessels are armed with less powerful guns than those deployed on Japanese coast guard vessels.

One slide showed that China's next step in the maritime intimidation effort is to send larger, 10,000-ton vessels to the Senkakus and convert high-speed naval vessels into coast guard ships.

Within the Pentagon, concerns have been raised by some officials who think CIRO's analyses downplay the growing danger posed by China.

CIRO's Mukaiyama, for example, appeared to minimize the threat posed by China's coast guard buildup by stating that the new coast guard vessels were poorly constructed and inadequately manned.

Mukaiyama's views on China were outlined in a 2012 report by the Center for Strategic and International Studies, which urged Japan to seek "understanding and cooperation" with Chinese leaders and pursue confidence-building measures aimed at closer ties.

Earlier this month, Japanese officials informed their Pentagon counterparts that Japan's government would not provide classified information on Japanese forces sought by the Office of Net Assessment. American task force participants had requested the classified information for use in a future war game.

Japanese officials discussed setting up a net assessment office in Tokyo during the task force meetings, stating that funds recently allocated for a new CIRO counterterrorism office could instead be used for the new office.

However, at the Nov. 10 meeting at the Pentagon, the Japanese informed net assessment officials that Abe had decided against creating the new office, according to U.S. and Japanese officials.

The Japanese delegation's statements are a sign the task force could be closed down in the future.

A Japanese government source said Tokyo decided against creating the office because of the difficulties of conducting net assessments.

Net assessments are secret studies that assess the balance of military forces in a future conflict. The studies weigh the strengths and weaknesses of a nation's forces and those of its adversaries. The studies are closely guarded secrets since they identify strategic vulnerabilities that could be exploited by enemies if discovered.

Briefing slide from Japan's CIRO intelligence agency presented during a Pentagon meeting with Japanese officials
Briefing slide from Japan's CIRO intelligence agency presented during a Pentagon meeting with Japanese officials

During the U.S.-Japan exchanges, the American side discussed the importance of intelligence, surveillance, and reconnaissance in assessing Chinese capabilities. "Because many aspects of those capabilities can be explored only by using classified information, the American delegation raised the issue of expanding the scope of work on the American side to include classified information," the second contractor report said, adding that the Japanese supported the idea.

The American side also said one of its weaknesses in a future regional conflict is its inability to coordinate Navy and Air Force assets operating in Asia.

The Japanese believe China is fearful of a disruption of shipping routes that carry vital energy resources like oil, which has led it to secure those routes. Beijing seeks to control waters first in the South China Sea, then along Indian Ocean shipping routes, and finally in the East China Sea.

Baker, the net assessment director, was quoted in the report as stating during meetings with the Japanese that both Tokyo and Washington have a "shared view of expansionist [Chinese] tendencies" in the South and East China Seas.

"This expansionism is not limited to the military and law enforcement spheres, as evidenced by efforts like the creation of the Asian Infrastructure Investment Bank," Baker was quoted as saying.

Baker came under fire from critics in the Pentagon and military after he opposed a plan by the staff of Gen. Joseph Dunford, chairman of the Joint Chiefs of Staff, to set up a net assessment capability in the Joint Staff. Military officers in the Joint Staff seek to create such an office over concerns the civilian Office of Net Assessment has not met the military's needs for net assessments.

According to the October report, Japan believes China's extensive island building in the South China Sea and more recent efforts to militarize new islands are "a rough template for future actions in the East China Sea" and the Senkakus.

CIRO believes crew shortages in the Chinese coast guard are a significant deficiency in Beijing's maritime power.

"[Chinese coast guard] ships are being operated with the minimum number of crew possible, leading to potential vulnerabilities if certain crew members are incapacitated," the report from the October meeting said, adding that coast guard crews are a "patchwork" of experienced and inexperienced sailors.

Crew shortages and poor training mean the Chinese "may find it difficult to sustain large-scale long duration, and highly organized activities in unpredictable contingenc[ies]," one of the Pentagon reports said.

Crew shortages are expected to produce further difficulties for the Chinese maritime operations as it deploys larger ships.

To make up for shortages of trained crew members, China appears to be using contractors, including former naval personnel employed by the Chinese firm Dewei Security.

A second presentation by Mukaiyama in the October meeting highlighted China's intention to control sea lanes in Southeast Asia.

In addition to Chinese ship incursions, Chinese air force flights in the region have prompted a record number of Japanese air force jet scrambles.

In the South China Sea, CIRO satellite images contained in the Pentagon report showed long Chinese runways under construction at Fiery Cross Reef and Subi Reef. A third runway is expected on nearby Mischief Reef in the Spratlys. The report said the runways "would be capable of hosting any aircraft in the [Chinese air force] inventory, from fighters to bombers."

"The PRC's interest in controlling the South China Sea is partly a function of its dependence on foreign trade, much of which transits the South China Sea," the October report stated.

"Oil supplies to the PRC in particular would be severely interrupted if the South China Sea and Malacca Strait were closed to Chinese vessels," the report said.

Japanese intelligence estimates that a disruption of crude oil from the Middle East would leave China with 75 days of energy supplies.

"In the South China Sea, the PRC is seeking to assert its territorial claims and establish military control—through military bases and deployed forces – in order to defend its sea lanes," the report said, adding that in the Indian Ocean, China wants to project power through bases, including one in Djibouti, near the Horn of Africa.

China also seeks to control the East China Sea to block American military intervention in any future conflicts.

The Japanese concluded that "Beijing would like to avoid escalation and seeks a fait accompli" by controlling waterways in the region.

During a later discussion on the Japanese presentation, American officials voiced surprise at the Japanese conclusion that the East China Sea was a lower priority for China than the South China Sea and Indian Ocean.

A Japanese map presented during the meeting showed the range of Chinese air-search radar and fighter aircraft that could be based on the Spratlys.

"The map demonstrated to participants that the PRC may still have significant gaps in air radar coverage of the South China Sea, especially if Scarborough Shoal is not militarized," the report said.

Other discussion included statements that Vietnam's military could block Chinese sea lanes and hinder the movement of Chinese warships in the South China Sea.

According to the March report, the last time Japan's government conducted a net assessment was 1941, when a group of experts compared Japanese and U.S. military capabilities prior to war in the Pacific. "This group looked at the outcome of a possible war with the United States and was fairly accurate in its prediction of Japanese defeat," the report said. "This prediction was, unfortunately, not heeded by the government."

That net assessment was ignored because it contradicted Tokyo's plan for a surprise attack on the U.S. naval base at Pearl Harbor in Hawaii in 1941, which triggered the United States entry into World War II.

Published under: China , Japan