Good morning and happy Sunday,

This is Pacific Weekly, a special edition of The Intel Brief intended to keep you updated on events across the hotly contested Indo-Pacific region.

Reporting Period: 30 December 2024 - 5 January 2025

Bottom-Line Up Front:

China Ends Year With Scarborough Shoal Incursion

Summary
On 29 December, forces with the PLA’s Southern Theater Command conducted large-scale combat readiness exercises around the Scarborough Shoal, an undeveloped island claimed by China that is within the Philippines’ exclusive economic zone. The drills involved PLA naval and air forces. China’s ministry of defense stated that the PLA Southern Theater Command has “continuously” strengthened China’s presence at the shoal, indicating China will continue its aggressive policy of incursions there.

Findings

• PLA Exercise: A video posted to X by the Southern Theater Command revealed what types of units were involved in the recent maneuvers. There were at least two Su-30 fighters, H-6K bombers, and Type 055 destroyers.

• US Navy Surveillance: The USNS Victorious — a non-commissioned US Navy ship — shadowed the patrols from outside the Philippines’ exclusive economic zone near Luzon. The USNS Victorious is a Victorious-class surveillance ship and is crewed by civilian mariners under the Military Sealift Command.

Why This Matters
The recent Chinese military activities at the Scarborough Shoal signify a robust assertion of Beijing’s territorial claims as 2024 ended. Continued incursions, in size and frequency, are raising concerns about potential confrontations in the region.

Sources: RFA, Inquirer, USNI News

PLA Navy Conducts Blockade Exercise Of Japanese Territory

Summary
On 1 January, The Japan Times reported that on 22 December, Chinese naval vessels deployed to the Miyako Strait to simulate a blockade between Miyako Island and Okinawa.

Findings

• Chinese Operations: The Japan Times reported that six vessels from the PLA Navy (PLAN) and Coast Guard (CCG) participated in the maneuvers. There were three frigates and three Coast Guard vessels, one of which was the CCG 2901 — the world’s largest maritime law enforcement vessel. The CCG vessels reportedly turned off their Automatic Identification System (AIS), a system used by maritime authorities to track vessels.

• Blockade: The report claims the vessels moved from maneuvers around Taiwan and Japan’s Sakishima Islands to the Miyako Strait, indicating blockade rehearsals. The report claims in a conflict scenario, China’s blockade may also extend to the Senkaku Islands, Japanese territory claimed by China.

• CCG Integration: In 2021, China passed a law authorizing the CCG to use lethal force to defend Chinese sovereignty and operate under order of the Central Military Commission (i.e. Xi Jinping’s authority). This effectively makes the Chinese Coast Guard a second Chinese Navy.
  However, China could use the CCG at regional flashpoints, such as the Senkakus or Scarborough Shoal, to seize territory and instigate conflict under a guise of plausible deniability (i.e. not claiming to be operating under military orders). This is also complicated by the fact that China views those territories as its own, and would almost certainly claim to be protecting Chinese territorial sovereignty.

Why This Matters
The maneuvers and blockade rehearsal reflect China’s continued ability to perfect its strategy for seizing Taiwan. Additionally, the clever use of the CCG as a deniable extension of the PLAN offers China an advantage in a conflict in which time will be a valued asset.

Actions by the CCG, at the outset of conflict, will likely confuse and deter US-led military intervention.

Sources: The Japan Times

Filipino Fishermen Discover Undersea Drone

Summary
On 2 January 2025, Filipino security officials stated an undersea drone they believe is Chinese was recovered off the coast of San Pascual, an island in the Philippine central archipelago. The drone was recovered by three fishermen who found it floating in the ocean.

Findings

• Features: A statement by the Bicol regional police director indicated the drone is marked “HY-119”, is six feet long, and has a frontal antenna and camera for remote viewing. Officials say the drone is a Chinese underwater surveillance system and carried no armaments.

• Propulsion: The Warzone compared the HY-119 to drones recovered in Indonesia between 2019 and 20202, and the Chinese Sea Wing ocean glider. The Warzone assesses that the drone likely moves in the water by altering its buoyancy through diving and resurfacing.

Why This Matters
The recovery of an HY-119, due to its similarity with previously recovered Sea Wings, indicates China is further developing uncrewed underwater vehicles (UUVs).

The significance of the UUV was alluded to by the Philippine National Police in Bicol, but I’ll break it down into more detail:

• Surveillance: UUVs provide opportunities to survey the underwater environment. This includes observing underwater environments (e.g. reefs), ports, underwater infrastructure (e.g. pipelines, dredges, rigs), and vessels.

• Sabotage: In addition to observing, UUVs can collect intelligence to support future targeting or sabotage. For example, in the earlier stages of the war in Ukraine, Kyiv successfully deployed UUVs to destroy Russian vessels in the Black Sea. This is a capability China is very likely to develop.

• Cost: UUVs are likely a cheaper option that deploying vessels, aircraft, or personnel for some missions associated with intelligence gathering. Also consider how UUVs can be used for commercial or industrial activity.

Sources: TWZ, CBS, Facebook

US Reveals Chinese Cyberattack On Treasury

Summary
On 30 December 2024, US officials revealed that a Chinese state-sponsored cyberattack targeted the US Treasury through a third-party software provider, BeyondTrust. The news of the breach was announced in a letter from the Treasury to Senators Brown (D-OH) and Scott (R-SC). China has denied any involvement, stating it opposes “all forms of hacking attacks.”

Findings

• Details: The breach was initially detected on 8 December. Chinese hackers exploited a cloud-based service from BeyondTrust to enter US Treasury networks. NBC News reports that unclassified documents were accessed by the hackers.

• Response: The US Treasury worked with CISA and the FBI to identify and neutralize the intrusion. There has been no confirmation of further breaches. The Treasury is expected to release a report, following an investigation, in January 2025.

Why This Matters
The attack on the Treasury is one minor incident that reflects a growing hostility from China:

• Salt Typhoon: In September 2024, reports emerged stating that Chinese state-sponsored group “Salt Typhoon” had conducted a major cyberattack on US telecommunications systems and the companies that run it. A major espionage campaign, gathered confidential data from US citizens, government officials, and corporations.

• Baltic Sea Sabotage: In November 2024, a Chinese ship — the Yi Peng 3 — was transiting the Baltic Sea and was suspected of dragging its anchor across the sea floor to destroy undersea cables.

• Export Sanctions: On 2 January, China announced it was instituting export control measures — which target US defense firms — due to US aid to Taiwan. The decision is being viewed as a trade war escalation as Donald Trump prepares to take office.

China is very likely to continue to conduct cyberattacks to support its economic and security strategy due to their low-cost, high-yield, and deniable nature.

Sources: Department of the Treasury, NBC News

End Brief

That concludes this edition of Pacific Weekly.

Enjoy the rest of your Sunday.

Thanks for reading,

Nick