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  • Report Faults Hughes on Data Given China

    By Walter Pincus and John Mintz
    Washington Post Staff Writers
    Wednesday, December 9, 1998; Page A22

    A preliminary Defense Department assessment has concluded that Hughes Electronics Corp. provided China with information potentially damaging to U.S. national security following the 1995 crash of a Chinese rocket carrying a Hughes-built commercial satellite, administration officials said yesterday.

    The assessment, requested by two congressional committees investigating the transfer of sensitive space technology to China, found that Hughes officials told the Chinese the cause of the crash had been traced to problems with the rocket's fairing, a heat-resistant shroud covering the satellite, officials said.

    One official said the assessment, performed jointly by Air Force Intelligence and the Defense Technology Security Administration, concluded Hughes "went well beyond what should have been allowed" by U.S. government agencies regulating such exchanges of technological advice.

    The official said top Pentagon officials want additional questions answered before a final report is provided to Congress.

    A Hughes spokesman said no one at the company has seen the Air Force report. But the spokesman, Don O'Neal, said Hughes "stands by the conclusion that we transferred to the Chinese no information that could be used to improve their ballistic missiles . . . . There's a significant difference between intercontinental ballistic missiles and commercial rockets."

    The Justice Department began a criminal probe last year into the transfer of rocket technology data to the Chinese by Loral Space & Communications after the 1996 explosion of a Chinese rocket carrying a Loral satellite. The investigation was expanded this year to include the 1995 rocket explosion involving Hughes. Two congressional committees began parallel investigations this spring.

    Air Force intelligence previously had concluded that Loral's communications with the Chinese in 1996 may have damaged U.S. national security. The company denies the allegation.

    The investigations of Hughes are rooted in an errant launch in 1995, when a Chinese Long March rocket exploded only seconds after liftoff. Chinese officials repeatedly blamed the Hughes satellite, saying it had exploded and torn off the top of the rocket. Western space industry executives said that was preposterous, and blamed problems with the Chinese rocket.

    Amid these bitter exchanges, Hughes received Commerce Department approval to discuss its theory of the mishap with the Chinese -- but only vaguely, so as not to disclose rocketry data that could assist Beijing in developing military missiles. Hughes officials said their conversations with the Chinese were very general.

    In any case, Hughes officials said the exchanges couldn't have helped the Chinese military because ballistic missiles don't have fairings.

    Justice Department and congressional investigators are also looking into whether Hughes should have known that it needed not only Commerce but State Department approval in 1995 to hold discussions with Chinese engineers.

    But from 1992 to 1995, the regulatory procedures governing such technical communications with China liberalized considerably. This occurred in part because of aggressive lobbying of the Clinton administration by Hughes, which U.S. officials said continually pushed the rules as far as possible to allow communications with Chinese space officials.

    Staff writer Vernon Loeb contributed to this report.

    Copyright 1998 The Washington Post Company

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