"Chinese espionage in the United States, which now comprises the single greatest threat to US technology, is straining the US counterintelligence establishment," the United States-China Economic and Security Review Commission said in a report to Congress.

To underline the seriousness of the espionage problem, the panel called for immediate steps to determine the country of origin of every US weapon system components and a "full assessment" of US intelligence capabilities related to China's military.

"The commission recommends that Congress require the Department of Defense to prepare a complete list of the country of origin of each component in every US weapon system to the bottom tier," the report said.

The commission also asked Congress to consider providing additional funding for US export control enforcement and counterintelligence efforts, specifically those tasked with preventing "illicit" technology transfers" to China and its "state-sponsored industrial espionage operations."

Industrial espionage "significantly contributes to China's military modernization and acquisition of new capabilities," the report said.

Commission vice-chairman Dan Blumenthal said the panel found that the pace of military modernization in China had exceeded official US estimates.

China's defense industry, he said, was producing new generations of weapon systems with impressive speed and quality, in part because China had developed the capacity to integrate commercial technologies into military systems.

"In addition, industrial espionage has given Chinese companies an added source of new technologies," he said at a news conference where the report was released.

The commission also called for tightening of measures to protect critical American computer networks and sensitive information from damage caused by cyber attacks.

"Chinese military strategists have embraced disruptive warfare techniques, including the use of cyber attacks (which) if carried out strategically on a large scale, could have catastrophic effects on the target country's critical infrastructure," it said.

A report earlier this year said China's military had successfully hacked into the US military computer network.

The Chinese military's cyber-attack was carried out in June following months of efforts, the London-based Financial Times reported, citing unnamed current and former US officials.

Officials had told the paper the attack was by China's People's Liberation Army (PLA) and that it led to the shutdown of a computer system serving the office of Defense Secretary Robert Gates.

The report Thursday also charged that China's "control and manipulation of information" made it difficult or impossible for officials responsible for product safety in the United States and other nations to identify potential safety problems in Chinese imports on a timely basis.

Dangerous exports from China ranging from toys to seafood have sparked a wave of global bans and recalls in recent months and severely tarnished the made-in-China label.

Beijing has taken various steps to contain the problem, and in July executed the former head of its food and drug safety watchdog for corruption.

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