The U.S. Department of Defense recently released its annual report on China’s military power, which shows that China’s military has made astounding advancements to “modernize its capabilities and improve its proficiencies across all warfare domains” in a relatively short period. The report also made it clear that one of the main objectives of the Chinese military’s modernization is to fight and win wars “against a strong enemy,” a not-so-subtle reference to the United States.

The most significant advancement of the Chinese military is its navy, which was almost non-existent four decades ago and now is the largest in the world, “with an overall battle force of approximately 355 ships and submarines, including approximately more than 145 major surface combatants.” By contrast, the U.S. Navy has a battle force of 293 ships as of early 2020. The DOD report also highlights that the Chinese People’s Liberation Army (PLA) has heavily invested in advanced technologies such as artificial intelligence (AI).

How did the PLA manage to modernize at such an astonishing speed? Besides heavy investment from the Chinese government, western companies have played a crucial role. Here are three examples.

German Engines Powered the Chinese Navy

German media recently disclosed that several types of Chinese navy warships are “powered by engines that were either developed or built by German manufacturers.” MTU, one of the German manufacturers, “was a regular supplier of engines for Luyang III class missile destroyers through a licensed production plant in China.” Luyang-class destroyers are equipped with state-of-art weapons systems and can launch land-attack cruise missiles, long-range surface-to-air missiles, and anti-submarine missiles.

Additionally, MTU supplied “engines that were used in China’s Song-class submarines.” A strong navy has enabled China to expand its territorial claim in the South China Sea, intimidate neighboring countries, disrupt standard commercial and exploration activities, and strengthen its ability to invade Taiwan.

In practice, the Chinese military relies on Chinese civilian companies to acquire advanced dual-use equipment and technologies for military development, while evading both the European Union’s and U.S. exports controls. That approach has significantly helped the Chinese military’s development in AI and semiconductors, often with eager cooperation from western firms.

Americans Help Speed Up the Chinese Military’s AI

A team of researchers at the Center for Security and Emerging Technology at Georgetown University released a report last month that highlights the crucial role U.S. companies play in supplying China with data, software, and funding for the nation’s AI development. The report finds that western firms have provided various Chinese military PLA units with commercial, off-the-shelf autonomous drones and AI-enabled surveillance software — AI tools that are ready for use.

The report also reveals that most of the advanced computer chips at the heart of China’s military AI systems are designed by U.S. firms such as Intel, Nvidia, and Xilinx. Furthermore, U.S.-based venture capital companies are financing Chinese companies that supply the Chinese military with AI-based battle management and cybersecurity software.

U.S. Companies Help China Develop Chips

Like AI, the semiconductor industry is another area where western companies have lent China’s military a helping hand. Semiconductor chips are essential components of almost all electronic devices, from computing to health care to the military and more. According to the Chinese government’s Made in China 2025 initiative, the semiconductor sector is one of the top ten industries that the government has heavily subsidized, hoping to make China self-sufficient in chip manufacturing and dominant in global high-tech manufacturing.

Out of concern for national security, the Trump administration imposed strict restrictions on exporting American semiconductor chip technology to Chinese companies that supply the Chinese military. China’s Semiconductor Manufacturing International Corporation (SIMC) is one such Chinese company on the U.S. export control list.

SIMC is a national champion identified by Beijing to lead China’s semiconductor chip development. It has received large government subsidies and is backed by several Chinese state-owned enterprises that also are suppliers of the PLA. The Biden administration expanded the export control list, banning Americans from investing in 59 Chinese companies with alleged ties to defense or surveillance technology sectors.

U.S. Companies Invested Despite China’s Atrocities

Companies such as Intel have been very vocal in their home countries, taking a stand against what they claim is systemic racism and racial injustice. Yet, at the same time, they have shown little concern as they assist Beijing with its military development, even though Beijing has committed gross human rights violations against its own people, poses a threat to liberal democracy, and has the ambition to spread authoritarianism around the world.

Thanks to these American companies, Chinese firms have made significant progress in key technologies and are quickly narrowing the gap with western chip makers in technology and manufacturing. These technological advancements have helped make the Chinese military a powerhouse and give the Chinese Communist Party powerful tools to advance its geopolitical ambitions and disrupt the liberal world order.

Passing Laws May Come Too Late

In a statement, Sen. Bob Casey (D-Pa.) criticized these American companies for prioritizing “their bottom lines without regard to the broader American economy or our national security.” He and Sen. John Cornyn (R-Texas) are working on legislation that would “screen outbound U.S. investments and the offshoring of critical supply chains and tech-industry resources to adversaries like China and Russia.”

While such legislation is a welcome move, it may not be the most effective and timely solution because a bill takes months of deliberation. By the time it becomes a law and actually goes into effect, it may be too late because technological advancement takes place daily, and China may have already acquired all it needs to be technically self-sufficient before the bill becomes law.

Helen Raleigh, CFA, is an American entrepreneur, writer, and speaker. She’s a senior contributor at The Federalist.