In recent years, American universities have been signing contracts around the world to sell their research findings and expertise, with some of the most lucrative agreements being made with Chinese companies. As the competition between the United States and China deepens, the U.S. Congress is concerned that these financial ties could pose a threat to national security.
According to a report on Monday, The Wall Street Journal analyzed about 2,900 university contracts and found that between 2012 and 2024, nearly 200 American universities had signed contracts worth up to $2.32 billion with Chinese enterprises.
The Wall Street Journal quoted Daniel Currell, an official from the Trump administration’s Department of Education, as saying, “It is clear that when China signs contracts with American universities, they gain abilities that they cannot obtain elsewhere.” He added, “The biggest question is, which contracts are legal, which are legal and public, and which are illegal?”
Last December, the House of Representatives passed a bill aimed at reducing the influence from China by tightening requirements for American universities to disclose funding from foreign entities. This legislation comes as both the U.S. Congress and the American public are increasingly wary of Chinese activities on university campuses.
Under the new law, American universities must now report any gifts or contracts from flagged foreign sources, with the threshold for reporting such funding from China reduced to zero, and from other foreign sources set at $50,000.
Over the past decade, American universities have increasingly relied on funding sources from China. According to a 2020 report from the House Foreign Affairs Committee, Chinese international students contribute approximately $12 billion in tuition fees annually. Since 2013, donations and contracts from Chinese sources have reached $1 billion.
American universities are closely tied to local industries, such as the relationship between the University of Michigan and the automotive industry.
Three major state-owned Chinese oil companies have provided $100,000 or more in contract funding to the University of Texas at Austin, which the university only described as “research activities.”
The Wall Street Journal revealed that the total value of university contracts involving China over the past decade is 2.5 times the publicly disclosed figure.
Despite the U.S. tightening scrutiny on Chinese students, China remains the largest source of foreign students on American campuses, with their expenditures (including tuition) far exceeding contracts and donations in most university budgets.
There is a growing call in Congress for a national security risk review of contracts between China and American schools.
The Wall Street Journal pointed out that some contracts provide the Chinese government with specialized training it lacks.
For example, China has lacked the small aircraft and general aviation airports necessary for pilot training. Therefore, for over a decade, major Chinese airlines such as Air China have paid millions annually to the University of North Dakota to train pilots and obtain licenses.
Detailed records from North Dakota State reveal contracts worth over $37 million from four Chinese airlines just between October 2018 and July 2022.
Students at the University of North Dakota Aerospace School complete 250 flight training hours at a small airport just miles from the Grand Forks Air Force Base, a center for military drones and satellites.
Approximately 30% of Air China’s pilots received training at the University of North Dakota, according to relevant data.
One of the authors of the report on Confucius Institutes by the National Association of Scholars, Senior Researcher Ian Oxnevad, said China presents particularly complex issues among foreign funders at American schools. He believes that American universities do not need money from China and should be vigilant against the Chinese military using civil commercial applications as a cover.
One prominent type of university contract in recent years has been conducting Chinese language training on American campuses under the name of Confucius Institutes. The University of Oklahoma reported a contract value of approximately $540,000 in 2019. After evidence of close ties with Chinese diplomatic missions emerged, most Confucius Institutes, including the one at the University of Oklahoma, were closed.
According to education department data, New York University is the university that receives the most funding from China, with over $46.5 million in contracts signed just for its Shanghai campus in 2021.
The Juilliard School, located in Manhattan, is one of the world’s top performing arts schools. Its first branch outside New York, the Tianjin Juilliard School near Beijing, has received over $133 million in such funding over the past decade, with its establishment witnessed by Peng Liyuan, the wife of then-Chinese Communist Party leader Xi Jinping.
The Wall Street Journal requested public records from the main public universities in all 50 states in the U.S. to understand the details of their contracts with Chinese entities. The disclosed information revealed direct or indirect Chinese involvement in a wide range of fields including medicine, agriculture, manufacturing, and the arts.
WuXi AppTec, a biotechnology conglomerate, known as the Huawei of the pharmaceutical industry in China, has garnered global acclaim for its breakthroughs and productions approved by the U.S. Food and Drug Administration (FDA). However, like the blacklisted telecom equipment manufacturer Huawei, the U.S. government is concerned that the company’s innovations may be misused by the Chinese authorities.
WuXi AppTec and Huawei both have contracts with American universities, but these companies claim to be private enterprises and refuse to acknowledge any directives from the Chinese authorities or pose a national security risk to the United States.
Last month, Reuters reported exclusively that WuXi AppTec provided American customer data to the Chinese authorities, posing a threat to U.S. national interests.
Aaron Friedberg, a member of the U.S.-China Economic and Security Review Commission, was cited by The Wall Street Journal as saying, “It is only recently that people have started to pay attention to what is happening in universities.”
The commission is urging legislation that would subject contracts between China and universities to a national security review by the Committee on Foreign Investment in the United States (CFIUS) as foreign acquisitions. Friedberg expressed concern that contracts are just one of many avenues through which the Chinese Communist Party enters U.S. research and development institutions.