Chinese military used OpenAI, Anthropic models to train defense AI, Reuters finds

Chinese military researchers have used outputs from leading U.S. artificial intelligence models developed by OpenAI and Anthropic to train domestic AI systems aimed at advancing China's defense capabilities, according to a Reuters review of more than 80 Chinese academic papers and patents published on July 31, 2026.devdiscourse+1

The findings reveal widespread use of a technique known as "model distillation," in which outputs from a powerful AI system are used to train smaller, specialized models that can be deployed locally without the computing requirements needed to build frontier AI systems from scratch.internazionale

From Drones to Cyber Warfare

Reuters' review, which included research compiled by the Washington-based Jamestown Foundation and shared exclusively with the news agency, showed distillation is widely used by researchers linked to the People's Liberation Army and other military institutions.wtvbam

A 2024 paper from the PLA's National University of Defense Technology described using distillation to shrink an image-processing model for deployment on unmanned aerial vehicles, allowing drones to analyze live video and support navigation and targeting decisions in real time even when communications are cut.devdiscourse+1

One paper by researchers in PLA Unit 96941, a military intelligence and cyber-warfare unit in Beijing, described using OpenAI's GPT-3.5 to process sensitive military source code, then training a domestic model on those summaries to run entirely within Chinese military networks.wtvbam

Sunny Cheung, a Jamestown Foundation fellow who analyzed over 60 of the papers, said Chinese military scientists are systematically capturing the reasoning steps of Western models to adapt them for surveillance, cyber warfare and tactical decision-making.internazionale

"These papers show Chinese military-linked researchers are trying to transfer that expensive, proprietary reasoning from Western models into smaller systems they can control and deploy locally," Cheung said.wtvbam

A New Flashpoint in US-China Tech Tensions

The issue has emerged as a major flashpoint ahead of U.S.-China talks on AI governance and safety. U.S. officials have accused some Chinese entities of using distillation to extract capabilities from American AI models, potentially undermining export controls and infringing intellectual property rights. China has rejected the accusations, saying Washington is pursuing AI "hegemonism."devdiscourse+1

Anthropic said it does not provide commercial access to Claude in China and warned that distilled models may lose the original systems' safety safeguards, "potentially allowing sensitive capabilities to be transferred to models beyond its control."wtvbam

Limits of the Technique

Experts caution that distillation has limitations. Trevor Koverko, co-founder of AI data company Sapien, said distilled models remain less capable than their teacher models. "It is best understood as transferring selected capabilities into a cheaper, locally controlled system, not achieving independence from frontier AI."internazionale

The White House, Pentagon, China's foreign ministry, the PLA, and OpenAI did not respond to Reuters' requests for comment.wtvbam