Amid Pandemic, Pentagon Urges ‘Hyper-Vigilance’ Against Foreign Investment

The Pentagon’s top acquisition official is worried that adversary nations may use the economic downturn caused by the new coronavirus pandemic to buy out American-made technologies.

During a Wednesday news conference, Ellen Lord warned that it “is critically important that we understand that during this crisis, the [defense-industrial base] is vulnerable to adversarial capital, so we need to ensure that companies can stay in business without losing their technology.”

The Pentagon over the last several years has become increasingly vocal about concerns that foreign nations — primarily China — are investing in U.S. startup companies whose technologies could have national security applications. Those startups have been willing to accept Chinese funds in exchange for Beijing having ownership or access to certain technologies.

Several times the officials were asked if there is a specific threat they are seeing from foreign investment at this moment, but both Lord and Jen Santos, deputy assistant secretary of defense for industrial policy, spoke only in general terms.

“I think it presents a greater attack surface, if you will, as there is uncertainty especially with small businesses as to whether their contracts will continue,” Lord said of the current pandemic. “To basically mitigate that uncertainty, that’s why we’re being forward-leaning and over-communicating, probably, to say: ‘We are open.’” (Read more from “Amid Pandemic, Pentagon Urges ‘Hyper-Vigilance’ Against Foreign Investment” HERE)

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