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You may have heard, Ukraine has been in the news lately.
But the real game of interest is not the impeachment proceedings.
It involves a company few Americans have heard of, China, Russia, and some aircraft engines.
Thread.
You may have heard, Ukraine has been in the news lately.
But the real game of interest is not the impeachment proceedings.
It involves a company few Americans have heard of, China, Russia, and some aircraft engines.
Thread.
Ukraine, one-time Soviet nation and now Russian adversary, has a complicated history little-understood in the West.
While it is was once primarily known as a major agricultural region, it also has a few tricks up its sleeve.
Especially, the defense sector.
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While it is was once primarily known as a major agricultural region, it also has a few tricks up its sleeve.
Especially, the defense sector.
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Now, this thread will unavoidably get deep into the weeds.
Like one of my previous threads about China and animal feed, there are wheels within wheels, intricately tied back to one another.
I'll endeavor to keep it concise and clear.
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Like one of my previous threads about China and animal feed, there are wheels within wheels, intricately tied back to one another.
I'll endeavor to keep it concise and clear.
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Tucked away in southern Ukraine, along the Dnieper River, is the city of Zaporizhzhya.
Home to more than 800,000 people, the city is a heavy-industrial center for Ukraine, with manufacturing spanning steel, aluminum, autos, transformers/substations, and...
Aircraft engines.
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Home to more than 800,000 people, the city is a heavy-industrial center for Ukraine, with manufacturing spanning steel, aluminum, autos, transformers/substations, and...
Aircraft engines.
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Zaporizhzhya hosts the headquarters of Motor Sich, a company designated by the Ukrainian government as a "strategic enterprise".
A remnant of the Soviet-era occupation of Ukraine, Motor Sich is a manufacturer of engines and components for aircraft and drilling equipment.
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A remnant of the Soviet-era occupation of Ukraine, Motor Sich is a manufacturer of engines and components for aircraft and drilling equipment.
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Motor Sich engines power an estimated 80% of Russian-built helicopters, including:
Mil Mi-2
Mil Mi-8/17 and variants
Mil Mi-24 (in the Hind F configuration)
There are many others, but these are the critical ones.
Let's quickly break these down.
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Mil Mi-2
Mil Mi-8/17 and variants
Mil Mi-24 (in the Hind F configuration)
There are many others, but these are the critical ones.
Let's quickly break these down.
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The Mil Mi-2 "Hoplite" is a small close-air support/multirole helicopter.
It carries troops, can be armed with rockets and machine guns, or fitted with reconnaisance equipment.
Fifteen countries (including the US), have active inventory of one or more variants.
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It carries troops, can be armed with rockets and machine guns, or fitted with reconnaisance equipment.
Fifteen countries (including the US), have active inventory of one or more variants.
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The Mil Mi-8/17 "Hip" is one of the most-produced helicopters in the world, with more than fifty countries holding some version or other in active inventory.
Like its little brother, the Mi-2, it can be configured in any way, with more than 20 different variants.
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Like its little brother, the Mi-2, it can be configured in any way, with more than 20 different variants.
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The Mil Mi-24 "Hind" is a legendary gunship that can also carry a small complement of troops.
It has been used in more than 30 conflicts going back to 1977.
While the original powerplants were Russian-made, a newer variant , the Mi-24P "Hind F", uses Motor Sich engines.
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It has been used in more than 30 conflicts going back to 1977.
While the original powerplants were Russian-made, a newer variant , the Mi-24P "Hind F", uses Motor Sich engines.
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Motor Sich powerplants were also used on the famous Antonov An-225, the largest airplane ever built.
It was originally built to transport the Soviet Buran space shuttle.
More recently, China has come up with an even bigger plan for the mega-plane:
Launching satellites.
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It was originally built to transport the Soviet Buran space shuttle.
More recently, China has come up with an even bigger plan for the mega-plane:
Launching satellites.
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Due to sanctions related to the ongoing Russia-Ukraine conflict going back to the 2014 Russian invasion of Crimea, Motor Sich can no longer provide sustainment for the Russian military's massive fleet of helicopters.
However, Motor Sich decided to ignore that.
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However, Motor Sich decided to ignore that.
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From 2014-2017, the Russian-born president of Motor Sich allegedly continued to sell components to Russia via Belarus, using a sanction-dodging technicality.
In April 2018, investigatory agents from the Ukrainian State Security Service (SBU) raided Motor Sich.
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In April 2018, investigatory agents from the Ukrainian State Security Service (SBU) raided Motor Sich.
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In the background, however, lurked China.
For years, China had quietly increased its ties to Ukraine. Where Ukraine had been dependent on Russian buyers pre-2014, it struggled thereafter.
Motor Sich, especially, needed cash and new markets.
China offered both.
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For years, China had quietly increased its ties to Ukraine. Where Ukraine had been dependent on Russian buyers pre-2014, it struggled thereafter.
Motor Sich, especially, needed cash and new markets.
China offered both.
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Through a complicated web of offshore companies, China managed to acquire a significant stake in Motor Sich between 2013-2016, rumored to be as much as 56%.
A separate SBU investigation revealed that a single man, Wang Jing, controlled all of these shell companies.
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A separate SBU investigation revealed that a single man, Wang Jing, controlled all of these shell companies.
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In 2017, one of Jing's companies, Beijing Skyrizon, stepped forward with a bid to take control of Motor Sich.
The ongoing investigation and sudden Ukrainian public awareness of control of a "strategic enterprise" by China sparked backlash.
The deal has been iced since.
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The ongoing investigation and sudden Ukrainian public awareness of control of a "strategic enterprise" by China sparked backlash.
The deal has been iced since.
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Jing is an unknown player in the West, except for one project:
He was the founder and public face of the effort to bypass the Panama Canal and build a larger canal joining the Pacific and Atlantic Oceans through Nicaragua.
The project has since been mothballed.
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He was the founder and public face of the effort to bypass the Panama Canal and build a larger canal joining the Pacific and Atlantic Oceans through Nicaragua.
The project has since been mothballed.
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Per @SCMPNews, the main reason was that Jing lost a good bit of his fortune (primarily built in telecom and aerospace) in a market downturn in 2015.
However, it did not slow Jing's other efforts to continue his stealth acquisition of Motor Sich.
https://www.scmp.com/news/world/article/1883514/chinese-company-postpones-us50-billion-canal-project-nicaragua-chairmans
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However, it did not slow Jing's other efforts to continue his stealth acquisition of Motor Sich.
https://www.scmp.com/news/world/article/1883514/chinese-company-postpones-us50-billion-canal-project-nicaragua-chairmans
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But it is the confluence of these things that is most interesting.
As I highlighted in my thread on China's missile program, the People's Liberation Army (PLA) derives an enormous amount of "black box" funding through its network of shell companies.
https://twitter.com/man_integrated/status/1197153357347074048
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As I highlighted in my thread on China's missile program, the People's Liberation Army (PLA) derives an enormous amount of "black box" funding through its network of shell companies.
https://twitter.com/man_integrated/status/1197153357347074048
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Aerospace and telecom are two such industries where the PLA is rumored to be highly active in ownership of commercial enterprises.
Wang Jing, especially, is considered by outside observers to be a direct proxy for the interests of the Chinese Communist Party and PLA.
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Wang Jing, especially, is considered by outside observers to be a direct proxy for the interests of the Chinese Communist Party and PLA.
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Further, it directly benefits the CCP and PLA to have a larger canal that cuts off North America from South America, and allows for passage of much larger commercial and military naval vessels.
As with Motor Sich, Jing seems to be acting as a proxy.
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As with Motor Sich, Jing seems to be acting as a proxy.
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Infrastructure...
Logistics...
Aerospace...
PLA-connected enterprises...
The Motor Sich deal, and the known players, fits a Chinese operational pattern of years-long gamesmanship, hidden hands, and multi-layered strategic planning servicing many needs at once.
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Logistics...
Aerospace...
PLA-connected enterprises...
The Motor Sich deal, and the known players, fits a Chinese operational pattern of years-long gamesmanship, hidden hands, and multi-layered strategic planning servicing many needs at once.
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If you're still with me, let's go a level deeper.
Having established Jing as a proxy for CCP/PLA efforts, let's look at his main holding company, Xinwei Technology Group.
While it is involved in a great many activities, let's zero in on a specific sector:
Satellites.
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Having established Jing as a proxy for CCP/PLA efforts, let's look at his main holding company, Xinwei Technology Group.
While it is involved in a great many activities, let's zero in on a specific sector:
Satellites.
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In 2016, Xinwei began a $285m purchase of Spacecom, an Israeli satellite manufacturer.
The deal was contingent on the successful launch of Spacecom's Amos-6 satellite.
On 1 September 2016, Amos-6 was the payload on @SpaceX's Falcon 9 launch vehicle.
Then this happened...
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The deal was contingent on the successful launch of Spacecom's Amos-6 satellite.
On 1 September 2016, Amos-6 was the payload on @SpaceX's Falcon 9 launch vehicle.
Then this happened...
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The Amos-6 (whose primary user was to be Facebook), went up in flames.
So too did Spacecom's deal with Xinwei.
Jing pulled his firm from the deal, and was back to square one on his efforts to acquire better satellite R&D and manufacturing capacity.
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So too did Spacecom's deal with Xinwei.
Jing pulled his firm from the deal, and was back to square one on his efforts to acquire better satellite R&D and manufacturing capacity.
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In 2014, Xinwei successfully launched/tested the Ling Qiao low-earth orbit (LEO) communications satellite in partnership with Tsinghua University and China Aerospace Science and Technology Corporation (CASC).
The technical data from Spacecom was to be a great leap forward.
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The technical data from Spacecom was to be a great leap forward.
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Undettered, Xinwei pressed forward.
In Feb 2018, CASC disclosed that it was planning to deploy a massive global network of LEO satellites, codenamed "Hongyan" (translated, "wild goose").
And at the heart of it, Xinwei's satellite tech.
https://gbtimes.com/china-to-build-300-satellite-hongyan-communications-constellation-in-low-earth-orbit
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In Feb 2018, CASC disclosed that it was planning to deploy a massive global network of LEO satellites, codenamed "Hongyan" (translated, "wild goose").
And at the heart of it, Xinwei's satellite tech.
https://gbtimes.com/china-to-build-300-satellite-hongyan-communications-constellation-in-low-earth-orbit
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With more than 300 satellites deploying by 2025, the Hongyan constellation is China's attempt to completely break free from the traditional fiber optic cable model that powers the global telecom industry.
Cable is vulnerable to breakage or sabotage.
China demands better.
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Cable is vulnerable to breakage or sabotage.
China demands better.
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Hongyan will connect directly to China's 5G network.
China's 5G tech has also been the source of serious shenanigans, ably covered by @adamscrabble.
The picture is clear now - China wants to dominate telecom infrastructure of the 21st century.
https://twitter.com/adamscrabble/status/1129080020012552193
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China's 5G tech has also been the source of serious shenanigans, ably covered by @adamscrabble.
The picture is clear now - China wants to dominate telecom infrastructure of the 21st century.
https://twitter.com/adamscrabble/status/1129080020012552193
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Now, what does all of this have to do with Ukraine?
Why is Jing and his Xinwei subsidiary Beijing Skyrizon tied so closely to the acquisition of a troubled, sanction-riddled company like Motor Sich?
Three reasons.
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Why is Jing and his Xinwei subsidiary Beijing Skyrizon tied so closely to the acquisition of a troubled, sanction-riddled company like Motor Sich?
Three reasons.
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First, the massive sustainment requirements for the global fleet of helicopters using Motor Sich engines (including China and Russia) is a durable base of revenue and R&D.
Second, Ukraine is a key node in #BeltandRoad.
Ukraine also supplies a great deal of grain to China.
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Second, Ukraine is a key node in #BeltandRoad.
Ukraine also supplies a great deal of grain to China.
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Third, and most relevant to this thread, is the aforementioned Antonov An-225.
All of the intellectual property relating to its unique engines belongs to Motor Sich.
In 2016, China inked a deal for Antonov to complete the second unit. As of 2019, it is 70% done.
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All of the intellectual property relating to its unique engines belongs to Motor Sich.
In 2016, China inked a deal for Antonov to complete the second unit. As of 2019, it is 70% done.
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Return your attention now to tweet 10 of this thread.
In addition to carrying more cargo than any plane ever, the Antonov An-225 is also capable of being a LEO satellite launch platform.
SpaceX's Falcon 9 costs $62m for a single launch.
Cost for the An-225: $30K/hour.
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In addition to carrying more cargo than any plane ever, the Antonov An-225 is also capable of being a LEO satellite launch platform.
SpaceX's Falcon 9 costs $62m for a single launch.
Cost for the An-225: $30K/hour.
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Even factoring in sustainment costs, the An-225 (or a newbuild variant) is a remarkably more versatile and cost-effective launch vehicle than the Falcon 9 or Chinese-equivalent "Long March" designs.
Liquid- or solid-fuel rockets are logistically difficult, at best.
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Liquid- or solid-fuel rockets are logistically difficult, at best.
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With hundreds of LEO satellites to launch and an enormous cost advantage, China's desire to stealthily acquire the secret sauce to high-altitude/heavy-lift capability makes all the sense in the world.
It is worth six years of subversion and risk.
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It is worth six years of subversion and risk.
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The Hongyan satellite constellation is primarily aimed to service stakeholders participating in the Belt and Road Initiative, as well as isolated regions, such as the poles.
By breaking its dependence on terrestrial infrastructure, China closes a critical security gap.
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By breaking its dependence on terrestrial infrastructure, China closes a critical security gap.
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The full picture in Ukraine has yet to come clear.
I won't speculate on Hunter/Joe Biden's deep and murky connections to Ukraine and China, nor the associated ongoing #impeachment process.
What we know is that China has aircraft to build and satellites to launch.
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I won't speculate on Hunter/Joe Biden's deep and murky connections to Ukraine and China, nor the associated ongoing #impeachment process.
What we know is that China has aircraft to build and satellites to launch.
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We know that China has invested many billions into Belt and Road, and also wants to control the means of physical logistics and narrative logistics (telecom) throughout Eurasia.
Further, a closed-loop telecom system is invaluable to China's burgeoning military ambitions.
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Further, a closed-loop telecom system is invaluable to China's burgeoning military ambitions.
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The purchase of Motor Sich would square all those circles.
It would also secure Ukraine fully to China in a pragmatic way, at a time when China is the largest buyer of Ukrainian corn and Russian nat-gas pipelines through Bulgaria and the North Sea now bypass Ukraine.
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It would also secure Ukraine fully to China in a pragmatic way, at a time when China is the largest buyer of Ukrainian corn and Russian nat-gas pipelines through Bulgaria and the North Sea now bypass Ukraine.
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. @POTUS seems to know this.
It's likely why a reputed "stealth advisor", Erik Prince, he of the notorious Blackwater and now Hong Kong-based Frontier Services Group, has stepped forward to purchase Motor Sich (and its intellectual property and records).
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It's likely why a reputed "stealth advisor", Erik Prince, he of the notorious Blackwater and now Hong Kong-based Frontier Services Group, has stepped forward to purchase Motor Sich (and its intellectual property and records).
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This story is far from over.
For the moment, it appears that China will not be able to cheaply launch the telecom complement to its BRI.
Wan Jing, the PLA proxy, will not have his canal or his aicraft engines.
And Ukraine will stay more relevant than anyone realizes.
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For the moment, it appears that China will not be able to cheaply launch the telecom complement to its BRI.
Wan Jing, the PLA proxy, will not have his canal or his aicraft engines.
And Ukraine will stay more relevant than anyone realizes.
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