As the European Union debates whether to lift its arms embargo against China, another issue is looming. According to some western defense experts, China could gain valuable military knowledge in the targeting of missiles and smart weapons through an EU satellite project that will be completed in a few years.
At issue is the European Union's more than $4 billion Galileo network, which is set to enter service in 2008. With 30 satellites and ground stations, it is intended to establish an extremely accurate navigation and positioning system that will have civilian and military uses.
China agreed in 2003 to invest more than $250 million in the network and soon contracts for the first development projects are to be signed.
Analysts familiar with the People's Liberation Army say China's military has the capability to use the Galileo system to gain access to sensitive high-technology. Richard North is a military and political specialist with the Bruges Group, a London-based research organization that is often critical of the European Union.
"The central issue is that the Peoples Liberation Army are upgrading," he said. "They are looking to particular use of high-technology in terms of command and control systems. And also in advance guidance systems for cruise-type missiles. Now advance guidance and command and control both depend intrinsically on having satellite guidance. The Chinese clearly want it for military purposes. And by having access to the Galileo system they acquire a potent military capability which threatens U.S. interests and can only have one rationale, and that is for military use."
Military analysts say missiles are a major part of China's strategy for controlling Taiwan, which it considers a break-away province. They also say modern anti-ship and anti-aircraft missiles would help the Chinese deter U.S. intervention in a Taiwan conflict.
The United States and its allies already have a system that performs much the same function as Galileo. By means of global positioning satellites the system keeps track of vessels and is able to guide weapons to their targets. Civilians may also use this global positioning system, known as GPS, but it can be restricted during times of war or because of other security threats.
The European Union says the Galileo satellite system is designed primarily for commercial use. But it uses an encoded signal called the Public Regulated Service, which is used by European police and military forces to fight crime and illegal immigration.
The European Union says it has taken precautions to ensure that China will not have access to the the Public Regulated Service or other sensitive technologies or functions.
Fraser Cameron, director of studies at the European Policy Center in Brussels, says Galileo does not pose a security threat.
"It would be very doubtful, in my view, that this can be used for military purposes," he said. "Because the GPS positioning system upon which it is based has been designed for civilian purposes. Both in terms of safety, transport, and security. With GPS positioning I do not think there is anything in the actual project which would provide for the ability to help guided missiles."
But military analyst Richard North, of the Bruges Group, disagrees. He says Chinese technicians with detailed knowledge of the technology could gain access to codes and could also take the system apart to learn its construction. He says those who believe the China's military will not be able to do this are naive.
"That is not credible," he said. "The Chinese are not just passive customers. They are development partners. They are fully integrated into the development of the system, with their own engineers working on the system, and therefore they have full access to the technology, and that which they are not given, they can very easily work out for themselves by back engineering [reverse engineering]."
Other analysts take a mixed view. Laurence Nardon, a space program specialist at the French Institute of International Relations in Paris, says there are security concerns, but they are being addressed.
"The risk with Galileo is that they [China] will be part of the system building," he said. "And that is where the risk lies. And I think the EU has to be very cautious, but I have reason to think that they do that already. So, yes there is an increase in the risk, but I think it is taken care of."
China is the number one EU trading partner. Beijing say it wants the Galileo satellite system to help with transportation, agriculture, fisheries, mapping, and emergency services.
Beijing has also asked the European Union to drop an arms embargo imposed after the 1989 Tiananmen square crackdown, saying the ban is outdated. Several European Union member countries, as well as the United States, oppose ending the embargo, saying Beijing would gain access to high-technology with military applications.