In the far western region of Xinjiang, China has created one of the world’s most sophisticated and intrusive state surveillance systems to target the predominantly Muslim Uighur ethnic minority. Part of what Beijing calls its anti-terrorism campaign, the system includes mandatory facial-recognition scans at gas stations and Wi-Fi sniffers that secretly collect data from network devices. Over the past two years, the technology has helped authorities round up an estimated hundreds of thousands of Uighurs and other Muslims and lock them up in clandestine camps that China calls “re-education centers.” For those detainees and for millions of others, this Chinese experiment in technological control has transformed Xinjiang into an Orwellian prison state. But for Chinese surveillance companies, it has turned the area into something else altogether: a lucrative market and a laboratory to test the latest gadgetry. The companies include some of the leaders in their field, often backed by Western investors and suppliers, according to analysts and activists who follow the plight of the Uighurs. Their research on the issue raises the grim prospect that many people around the world are profiting from some of China’s worst human rights abuses. The companies include the world’s two largest security camera manufacturers, Hikvision and Dahua Technology. Though they are not household names, odds are you’ve been filmed by one of their products. Combined, the two firms supply around one-third of the global market for security cameras and related goods like digital video recorders. They are publicly traded at the Shenzhen Stock Exchange and are worth a combined $70 billion — billions more than better-known brands like Sony. Hikvision and Dahua have already attracted scrutiny in the West, where their popular cameras are deployed at U.S. Army bases and other sensitive locations. Hikvision has close ties to the Chinese government — it’s partly owned by a state defense contractor and its chairman was appointed to the National People’s Congress, China’s rubber-stamp parliament, earlier this year — raising concern in the United States that China might be harnessing these cameras for espionage (charges Hikvision strongly denies). Last month, the House of Representatives passed the annual National Defense Authorization bill for 2019, which includes a provision that would bar the U.S. government from purchasing both firms’ products. But the two companies’ activities within China, where they make the bulk of their revenues, have received little scrutiny — allowing both firms to capitalize on China’s surge in security spending in Xinjiang in recent years. Beijing has long worried about a Muslim separatist movement in Xinjiang, a huge mineral-rich region that straddles key trade routes. In response, it has promoted the migration of millions of Han Chinese — people from China’s ethnic majority — to the province, a strategy which backfired in 2009 when race riots left hundreds dead in Xinjiang’s capital of Urumqi. As Beijing cracked down, some Uighurs turned to terrorism. In 2016, China appointed Chen Quanguo to run the province, a hard-liner who had previously run the Tibet autonomous region. In short order, Quanguo nearly doubled security spending in Xinjiang to an astonishing $9 billion per year. Since then, Hikvision and Dahua have won at least $1.2 billion in government contracts for 11 separate, large-scale surveillance projects across Xinjiang, according to Chinese bidding websites and the Shenzhen Stock Exchange (as I first detailed at IPVM, a U.S. trade publication covering the surveillance industry). Most of the Xinjiang projects were launched in 2017, a year in which Hikvision and Dahua’s revenues grew by 30 and 40 percent respectively, and most are located in predominantly Uighur parts of the province.

Police walk past a barber near the Id Kah Mosque in Kashgar, in China's Xinjiang region, on June 26, 2017. (Johannes Eisele/AFP/Getty Images)

Suspects flagged for practicing their religion

The scale of these projects is huge. A single “safe county” project won by Dahua in Yarkant County in 2017, the site of violent riots that left scores dead in 2014, is worth the equivalent of $686 million over a 10-year period. Another project won by Hikvision in Xinjiang’s capital city of Urumqi is worth $79 million and includes some 30,000 security cameras. The projects include not only security cameras but also video analytics hubs, intelligent monitoring systems, big data centers, police checkpoints, and even drones. Most of the projects are under construction, but some are already completed or partially operating.

These mass surveillance schemes are not a new phenomenon in China. Beijing began began building a nationwide surveillance network in 2005 called Skynet to better control public order in urban areas. In 2015, authorities launched a dramatic expansion and update of Skynet called Sharp Eyes, intended to cover the entire country with facial-recognition systems and other technology.

While these national programs have raised concerns on their own, nowhere has Chinese state surveillance been as broad and intrusive as in Xinjiang. In an attempt to establish total control, Chinese authorities have pushed local apps capable of covertly passing data to authorities, detained Uighurs for studying abroad, and even arrested the families of Uighur reporters working for a U.S. state-funded outlet. There, even buying a knife or entering a bazaar can require an identity check.

But the most disturbing feature of China’s clampdown is the secretive network of re-education camps where Uighurs and other minorities are detained for exhibiting behavior deemed too Islamic or anti-China. One county where Hikvision is building a $46 million surveillance project, Karakash, has seen almost half its Uighur population disappear according to some reports, although there’s no indication Hikvision has supplied the re-education camps themselves. Former inmates of the camps have alleged torture and brainwashing. A U.S. State Department official recently said Washington could sanction Chinese officials involved in the crackdown.

To Peter Irwin, project manager for the Germany-based World Uyghur Congress, the boom in surveillance projects and the mass detentions are inextricably linked. “Information from facial recognition software and surveillance cameras feeds into a central database that may directly lead to Uyghurs being arrested and sent to what the government terms re-education camps,” he said. Because Chinese government figures are unavailable, estimates of those detained vary wildly. Adrian Zenz, a researcher at the European School of Culture and Theology who has documented the construction of dozens of re-education camps since 2016, says the number is somewhere between hundreds of thousands and over 1 million.

Hikvision did not respond to requests for comment. A Dahua spokesperson said Dahua simply provided its “standard offering” of equipment in Xinjiang, where its market share is similar to the business it does in the rest of China. The spokesperson said the recent surge in projects has come as a surprise.

But the expansion of surveillance in Xinjiang goes far beyond traffic cameras or monitoring public areas. For example, two of the 11 surveillance projects won by Hikvision in Xinjiang specifically included provisions for video surveillance systems to be set up in mosques in rural areas. One of those projects is a $53 million deal announced in 2017 for a facial-recognition system in Pishan County, the site of a terrorist attack earlier that year.

Hikvision is also 42 percent owned by Chinese government entities controlled by the China Electronics Technology Group Corporation (CETC), a state defense contractor deeply involved in Xinjiang. Bloomberg reported that CETC is developing a facial-recognition system in the province that automatically notifies authorities when certain people leave designated areas. According to Human Rights Watch, a different CETC subsidiary is also a supplier for a predictive policing system, called the Integrated Joint Operations Platform (IJOP), that identifies suspects based on everything from surveillance footage to bank records and flags them for investigation by authorities as possible candidates for the re-education camps. The IJOP project and others have raised concerns that Uighurs are being targeted by the Chinese government for little more than practicing their religion. Legislation enacted last year already prohibits Xinjiang residents from wearing full-face veils and growing long beards, signs of Islamic piety. Additionally, the Associated Press identified the CETC as the maker of a facial scanner set up at the entry of a bazaar in Hotan town and found a total of 27 CETC bids for government contracts in Xinjiang.

While Hikvision has distanced itself from the CETC (as I co-reported in the Wall Street Journal), in a 2016 bond prospectus it said it was the firm’s “most profitable entity,” accounting for over 40 percent of profits in 2014. It said the conglomerate was “in a position to exert significant influence over our business and other matters of significance to us.” And the company has not been shy about marketing its technology as a tool for racial profiling. In a recent promotional video, Hikvision showcased new facial-recognition software that could automatically determine whether someone belongs to an ethnic minority or not. It remains unclear if this technology is currently used in Xinjiang or elsewhere.

Hikvision also appears to have directly involved in the manufacturing of IJOP, the predictive policing system identified in the February Human Rights Watch report. According to Maya Wang, HRW’s senior China researcher and one of the report’s authors, Hikvision won a contract in 2017 to supply equipment to the IJOP which included “Wi-Fi sniffers,” probes that gather the unique addresses of devices like laptops and smartphones and can be used to covertly read people’s emails.

James Leibold, an associate professor at Australia’s La Trobe University and an expert on Xinjiang, said he’s long observed that mosques in major cities like Kashgar had government security cameras. But their expansion into rural areas seems new. He described it as another sign of the disproportionate measures authorities are taking to combat a relatively small terror threat in the province. “It’s like swatting a fly with a cruise missile,” Leibold said.