WASHINGTON — Congress should set in motion a sweeping initiative to ensure that the United States can stay ahead of China’s rapid development of dual-use quantum technologies and artificial intelligence, urges the US-China Economic and Security Review Commission in its latest annual report.
“Whoever leads in quantum (and artificial intelligence) will control the encryption of the digital economy; enable breakthroughs in materials, energy, and medicine; and gain asymmetric and likely persistent advantage in intelligence and targeting,” the commission’s 2025 report, presented to Congress today, says.
“It is imperative that the United States treat quantum not as a research silo but as a mission-critical national capability—and act accordingly,” the report adds.
The commission’s 2025 report finds that China is continuing to “pour significant resources into over-the-horizon technologies such as artificial intelligence and quantum computing that have dual-use purposes and could accelerate China’s military and intelligence capabilities.”
Thus, the group recommends that lawmakers establish by 2030 a “quantum first” goal to “focus on quantum computational advantage in three mission-critical domains—cryptography, drug discovery, and materials science.” The commission argues that the 2030 timeline “is essential to ensure the United States achieves quantum leadership before any adversary can leverage these capabilities against American interests.”
In tandem, Congress should provide “significant funding” for US quantum development, “focused on scalable quantum computing modalities, secure communications, and post-quantum cryptography,” as well as to new “workforce development” programs.
This includes the creation of a “Quantum Software Engineering Institute (QSEI) focused on developing the software foundations for scalable, secure, and interoperable quantum computing,” modeled on the National Artificial Intelligence Research Institutes and National Manufacturing Institutes. “[T]he QSEI would ensure that U.S. quantum hardware is matched by world-class software capabilities, enabling early operational advantage across science, industry, and defense,” the report says.
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The bipartisan US-China Commission was established by Congress in 2000 to “investigate, and report to Congress on the national security implications of the bilateral trade and economic relationship between the United States and the People’s Republic of China,” according to the commission website.
Stronger Export Controls, Congressional Oversight
More broadly, the US-China Commission is calling for series of measures to substantially beef up US export controls on key technologies, such as semiconductors.
The report’s number one recommendation is that Congress mandate a new, interagency organization to “address the evolving national security challenges” being created by China’s “systematic and persistent evasion” of US export controls and sanctions.
This “unified economic statecraft entity” should at a minimum include: the Commerce Department’s Bureau of Industry and Security (BIS), the Treasury Department’s Office of Foreign Assets Control, the Office of Export Control Cooperation at the State Department’s Bureau of International Security and Nonproliferation, and the Defense Department’s Defense Technology Security Administration, the report elaborates. Further, it should be tightly integrated with the Intelligence Community to allow “enhanced access to real-time intelligence on evasion networks.”
“[T]his is not something that we’d snap our fingers and all of a sudden have an entity ready to go in in trade negotiations with the current administration. It’s something that’s going to take time to implement and to integrate,” explained Commissioner Leland Miller, who is the CEO of the China Beige Book that provides data on the Chinese economy to companies and investors.
“The idea, though, is that the piecemeal approach to economic sanctions and to export controls has meant that there hasn’t been coordination. … [D]ifferent agencies have sort of prioritized and and operated separately,” he told reporters on Monday. “So, I think one of the reasons that we have pushed on this, and have elevated this to our top recommendation, is that there is a need at this point for these really important national security priorities to be put forward as more than a throw in in a trade negotiation.”
In addition, the commission urges lawmakers to strengthen the ability of BIS “to manage strategic competition with China in fast-moving technology sectors, such as leading-edge semiconductors used in artificial intelligence (AI) applications, and increase congressional oversight.”
This includes two key changes to US export controls on AI-enabling chips. First, Congress should direct BIS to change the “presumption of denial” for licenses to export to China those microchips now on Commerce’s export control list to a more stringent “policy of denial” — meaning that exports of certain chips would be barred if deemed potentially harmful to US national security.
The second change would call for Congress to force BIS to set up a system to “rent” rather than sell “advanced chips” by “mandating that any advanced chips above a certain threshold that are not designated as prohibited for export be accessible exclusively via the cloud.” Under the new system, exporters would be required as part of their licenses to vet their customers and report any “suspicious” activities.
Space
Over the past few years the commission has outsourced reports on China’s rapidly expanding space capabilities, and the new report doubles down on those concerns.
“China is pursuing an aggressive long-term, whole-of-government campaign to expand its space capabilities across military, commercial, and civil domains with the explicit intent of surpassing the United States. These rapid advances in space pose an escalating threat to U.S. national security, intensify U.S.-China strategic competition for international partnerships, and undermine the ability of U.S. commercial firms to compete internationally,” the report finds.
In the military arena, the report focuses in on the PLA’s pursuit of counterspace capabilities designed to “degrade, damage, or destroy” US satellites “that provide the backbone” the military’s command and control network and targeting systems. The commissioners stress that over the past decade China has maintained an “aggressive schedule” of satellite launches for its own military use, as well as strengthen its ability to keep tabs on, and in the case of conflict target, US forces, especially those in the Indo-Pacific.
“Beijing’s investment in counterspace systems — including direct-ascent anti-satellite weapons and co-orbital interference platforms — illustrates its strategy of blinding and disorienting U.S. forces in the opening phase of a conflict,” the report states.
The commissioners thus recommend that Congress take actions “to preserve and strengthen U.S. primacy in the critical space domain as China pursues sweeping advancements across military, commercial, and civil space sectors.”
These include moving to “increase or reallocate appropriations” for the Space Force “to levels necessary to achieve space control and establish space superiority against China’s rapidly expanding space and counterspace capabilities.” Lawmakers also should “direct” DoD to improve the Space Force’s capacity for wargaming, modeling, simulation and training.
In addition, the report urges Congress to hold oversight hearings designed “to ensure the United States maintains primacy in the space domain by identifying investments in cutting-edge space technologies and assessing China’s space capabilities and threats to U.S. space industrial base capacity.”