Riding the Wave: The rise of China and options for Australian policy

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The Australian Strategic Policy Institute has released its latest Strategy report, which addresses the strategic dimensions of the reemergence of China providing a complement to the earlier David Hale assessment of China’s economic prospects.

The report is authored by Professor Ross Terrill, Harvard-based China specialist and titled ‘Riding the Wave: The rise of China and options for Australian policy’. 

‘The People’s Republic of China’s rapid economic growth rates are accompanied by military advances, a heightened quest for markets and resources, diplomatic assertiveness, and increased national pride. China’s role is now of global importance.’ Professor Terrill reports.

‘As 2006 begins, nobody denies the increased importance of China in Asia and beyond. Final 2005 figures appeared to place China as the world’s fourth largest economy for the first time, ahead of the UK, France and Italy. But the rise of a country to the front rank of world powers is always a complex process.’

‘Chinese foreign policy seeks to maximise stability at home, sustain China’s impressive economic growth, and maintain peace in China’s complicated geographic situation. More problematically, it also seeks to blunt US influence in East Asia. 

The paper argues that China’s fulfilment of its foreign policy goals will depend basically on the evolution of its political system and the reaction of other powers to its ambitions.

Australia’s situation in the region has changed mostly for the better over the past decade, and some sharp choices of the 1990s seem to have been transcended by globalisation, economic developments and the challenge from terrorism. 

This paper urges clear thinking by Australians about whether the US will remain strong and engaged in the region, the proper place of deterrence, the ways Beijing’s mercantilism differs from free-market approaches to the international community, and whether an authoritarian China can also be an enduringly strong China.

Precarious State: Afghanistan and the international and Australian response

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Release of Australian Strategic Policy Institute (ASPI) Strategic Insight No. 23/2006

The Australian Strategic Policy Institute has today released a new ASPI Strategic Insight publication which examines the current situation in Afghanistan, including international security and reconstruction efforts. It analyses NATO’s expansion into the south of Afghanistan and in particular the 200-strong Australian Provincial Reconstruction Team (PRT) deployment to the province of Oruzgan, which is due in late July. 

Authored by Strategy and International Program Director Dr Elsina Wainwright, the Insight argues that notwithstanding these new initiatives, insufficient international attention is still being paid to Afghanistan, and it remains an acutely fragile state. Afghanistan has had far fewer international troops and aid per capita than operations in East Timor, Kosovo, Bosnia and Iraq. Several security trends are also worrying, especially the increase in insurgent activity. There were around 1600 Afghan deaths and 91US military deaths from insurgency-related activity in 2005—a 20% increase in a year, making 2005 the most dangerous in Afghanistan since 2001. The insurgency has recently changed tactics, with suicide attacks up almost fourfold in 2005 from 2004 and the use of improvised explosive devices more than doubling in the past year.

‘NATO’s extension into the south and later the east of Afghanistan is appropriate. Real threats to Afghanistan’s stability lie in these regions: they are the heartland of the insurgency. As a result, the deployments will be dangerous for all participating states, including Australia. Predictions have been made that the Taliban and Al Qaeda will seek to test deploying troops.’

‘Australia’s PRT deployment to the restive southern province of Oruzgan, birthplace of former Taliban leader Mullah Omah, will carry considerable risks.’

‘The Australian PRT deployment will also involve a number of operational challenges. Australian forces will receive protection from the Dutch troops, and their security therefore depends on very robust Dutch rules of engagement.’

In the Balance: China’s unprecedented growth and implications for the Asia-Pacific

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The Australian Strategic Policy Institute (ASPI) has today released its report, In the Balance: China’s unprecedented growth and implications for the Asia-Pacific.

The Australian Strategic Policy Institute has today released its latest Strategy report, delivering an assessment of China’s economic prospects and the impact on the Asia—Pacific region. 

The report is authored by David D Hale, a Chicago-based economist and founding chairman of Hale Advisors and China Online and was launched at Parliament House, Canberra.

Few issues are more important to Australia’s long-term strategic position in the Asia-Pacific than the health of China’s economy and the nature of Beijing’s foreign and defence policies. 

Hale provides startling data to show how rapidly China is coming to dominate not only the Asia-Pacific economies, but also to be a fundamental driving factor in Europe and North America. Hale says: ‘China could soon be the world’s leading exporter, she has a great strategic interest in promoting an open multilateral trading system rather than a world characterised by regional trade agreements.’

His paper also assesses some of the serious impediments in the way of continuing high growth. Most critically of all he argues that: ‘The great challenge now confronting China is to complete the transition to a transparent market economy with a democratic form of government.’ 

What are the likely foreign and strategic policy implications? Hale says ‘The rise of China will be the first major test of whether [the global system of states] has the capacity to cope with a new great power.’

China is increasingly active on a global diplomatic stage, pursuing resources in places as far afield as Zimbabwe, the Sudan and Venezuela. China has a growing strategic interest in Central Asia and the Middle East and this is creating a new dimension in Beijing’s relationship with the United States and other major powers.

Hale points out: ‘The experience of 1914 is a warning that one cannot depend upon economic factors to resolve political conflicts, but the situation in East Asia today contains fewer political risks than Europe during the early 20th century.’ 

‘It is critical to understand that the reemergence of China will have profound implications for geopolitical relationships, not just trading interests.’

Cutting Edge: The Collins experience

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The Australian Strategic Policy Institute (ASPI) has today released its report, Cutting Edge: The Collins experience.

The Australian Strategic Policy Institute has today released a new Strategic Insight publication examining the Collins Class submarine project – the most ambitious and controversial defence project ever undertaken in Australia. 

Authored by Patrick Walters, National Security Editor, The Australian, and titled ‘Cutting Edge: The Collins experience’, this Insight provides a broad overview of the Collins Class project. It examines the industry, capability and strategic impact of this complex defence project and finds that the Commonwealth’s $5 billion investment has not only provided Australia with a key strategic asset but also greatly boosted the skill base of our naval construction industry.

‘The Collins submarines are very quiet and have performed exceptionally well on long deployment and in regular exercises with the United States Navy. One of Australia’s most vital front-line defence assets they are now widely regarded as the finest conventional submarines in the world.’ Walters writes.

‘The strategic importance of this local industry capacity is underlined by the fact that no future off-the-shelf submarine is likely to come close to Australia’s unique requirements.’

The paper finds that not all the original industry goals for the Collins class were achieved. The Australian build did not produce the export program envisaged by government and industry in the 1990s. Strategic, political and commercial considerations have meant that this unique marriage of European, US and Australian technologies has not produced an export version of the Collins. 

The government will have to make a decision early next decade whether to go ahead with an Australian build of a new generation submarine, which would require another bold commitment from government and close collaboration between the Defence Organisation and local industry.

A crucial test for ASC and Australian industry will be the Air Warfare Destroyer (AWD) project which is scheduled to deliver its first warship in 2013. Successfully meeting this challenge and lifting Australia’s industry skills base should give future governments the confidence to progress the construction of Australia’s next generation submarine.

‘The all-round experience gained from the Collins class augurs well for the future.’ Patrick concludes.

Pay Your Money & Take Your Pick: Defence Spending Choices for Australia

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Release of an Australian Strategic Policy Institute (ASPI) Policy Report on Defence Spending.

The Hon. Alexander Downer, MP, Minister for Foreign Affairs, today launched the ASPI report “Pay Your Money & Take Your Pick: Defence Spending Choices for Australia”.

The report looks at what sort of defence force Australia can afford at differing levels of defence spending.

The author of the report Dr Mark Thomson said: 

“All too often the defence spending debate gets hung up on how much is being spent on defence without looking at what is being delivered for the money. This report aims to remedy this by examining five alternative options for future defence spending.” 

“Our approach has been to look at the military capabilities and tasks that can be afforded at various levels of defence spending – from a modest 1.3% of GDP up to a robust 2.5%.”

” At the lower end of the spectrum we looked at what cutting real defence spending back to levels we would have been at without the White Paper funding increase. We found you get a defence force that is less capable than today’s but still able to undertake a credible range of tasks. Its Achilles heel is that our relative military strength would erode as regional countries continued the modernisation of their forces.”

“At the top end of the options we found that 2.5% of GDP would allow us to develop a power projection capability built around two aircraft carriers and a much expanded Army and more capable Air Force and Navy. This would significantly boost our standing as an ally and enhance our ability to play a role in the region.” 

“There is no ‘right’ answer to how much to spend of defence, instead we have choice to make between difference military capabilities, and between defence spending and other alternatives.”

“We have stopped short of identifying a preferred option – our goal has been to provide an information resource to promote a more focused debate on defence spending. In doing so we have developed options that highlight the trade-offs and choices that can be made.”

The report was prepared by Dr Mark Thomson, ASPI Budget and Management Program Director.

To find a copy of the report go to ASPI’s web site: http://www.aspi.org.au

Pakistan’s Musharraf: Playing a balancing act

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Release of Australian Strategic Policy Institute (ASPI) Strategic Insight No. 21/2005

The Australian Strategic Policy Institute has today released a new ASPI Strategic Insight publication titled ‘Pakistan’s Musharraf: Playing a balancing act’ , reviewing the key domestic and foreign policy issues confronting Pakistan’s President Pervez Musharraf. The report also investigates what the Australian Government’s interests and options are in supporting the president as he tries to handle his country’s challenging domestic and external environment.

The report was authored by Dr Claude Rakisits, who heads independent consultancy Geopolitical Assessments, focusing on developments in South Asia, the Middle East and Africa. 

He states that ‘The Australian Government’s interest in Pakistan first increased significantly after 9/11, and particularly following Musharraf’s crucial decision to join the West in the War on Terror. As a result of this, Australia re-established in late September 2001 bilateral defence relations, which had previously been suspended following Pakistan’s May 1998 nuclear tests.’

‘Pakistan’s important role in the War on Terror was recognised during Musharraf’s visit to Australia, in June 2005, with the signing of a Memorandum of Understanding (MOU) on Counter-Terrorism, setting up the framework for the exchange of information and intelligence, joint training activities and capacity building initiatives.

‘President Pervez Musharraf’s state visit to Australia-the first by Pakistan’s head of state-highlights Australia’s increasing interest in Pakistan, an interest demonstrated even more so by Canberra’s response to the devastating earthquake in Pakistan last month. The Australian Government’s quick response in providing over $14 million in assistance has further consolidated this deepening relationship.’

‘The US also provided US$50 million in humanitarian assistance, which it has made clear, was to thank Pakistan for its contribution to the War on Terror.’ Dr Rakisits says. 

The Insight offers several policy recommendations designed to promote Australia’s interests in Pakistan and to support President Musharraf, particularly in this time of crisis.

Shared Interests: Australia-India relations into the twenty-first century

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The Australian Strategic Policy Institute (ASPI) has today released its report, titled Shared Interests: Australia-India relations into the twenty-first century on the proceedings of the fourth Australia-India Security Roundtable, held in Canberra on 11-12 April 2005.

The first Security Roundtable took place in July 2001 in New Delhi, the second in May 2002 in Sydney, and the third was held in October 2003 in Chandigarh. This fourth meeting built on the success of previous dialogues: fourteen strategic analysts from both countries discussed a range of important issues vital to each country’s defence and security planning.

This is a collected volume of short written papers or transcripts of presentations from all of the participants in the Roundtable. The papers outline a diverse and constructive range of policy-relevant ideas from which the governments of both countries can draw to help deepen and broaden security ties between Australia and India. 

The volume also includes the address by Professor Varun Sahni of Jawaharlal Nehru University at the ASPI Defence and Security Luncheon in April. 

This ASPI Strategy is illustrated with a series of remarkable photographs sourced from the collection of the Australian War Memorial and the Defence Department. These images record the experiences of almost a century of Australian and Indian military forces working together to promote peace and stability.

Crunch Time: Planning Australia’s future defence forces

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Release of Australian Strategic Policy Institute (ASPI) Strategic Insight No. 20/2005

The Australian Strategic Policy Institute has today released a new ASPI Strategic Insight publication titled ‘Crunch Time: Planning Australia’s future defence forces’.

In the coming months the government will make some big decisions about how billions of dollars will be spent in the next stage of Australia’s largest military build up since Vietnam. The result will be two public documents: A revised Defence Capability Plan that sets out the acquisition program for the next decade, and a Strategic Update containing an explanation of why these new investments are needed. 

Crunch Time examines the issues faced by the government in producing these two documents and explores the critical question of long-term Defence funding.

In releasing the document, Dr Thomson said:

‘On past experience, the Strategic Update will provide an overview of recent strategic developments and an assessment of the implications for Australia. Central to this, will be judgements by the government about how and where Australia’s military forces might be employed in the future.’

It is only by clarifying the future role of the defence force that the rationale behind the individual projects in the multi-billion dollar Defence Capability Plan can be made clear. 

‘The government will also have to decide how much it is willing to spend on defence. Five years ago, they made a decade-long funding commitment of average 3% real growth, but that runs out in 2010.’

‘In the absence of increased spending past the end of the decade, either the planned level of capital investment must be cut, or the size of defence force reduced, or both. There are no easy solutions given the looming fiscal impact of Australia’s ageing population.’

‘We can only be sure that the government is developing a sustainable defence force with the right capabilities if we see: 

A Strategic Update that clarifies the outstanding issues in Australia’s strategic policy, including a clear statement of the role of the Army and its amphibious component. 

A Defence Capability Plan that sets out the military capabilities to be developed in the future, which is consistent with the top-down guidance in the Strategic Update.

A decade-long funding commitment out to 2015 that covers the cost of acquiring and operating existing and planned capabilities, balanced against what’s affordable for the nation in the long-term.’

Getting China Right: Australia’s policy options for dealing with China

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Release of Australian Strategic Policy Institute (ASPI) Strategic Insight No. 19/2005

The Australian Strategic Policy Institute has today released a new ASPI Strategic Insight publication titled ‘Getting China Right: Australia’s policy options for dealing with China’, which examines Australian policy towards China. 

Authored by Director of Programs Peter Jennings, the Insight argues the case for an Australian policy towards China that balances our long-term interest in having both a sound economic relationship and growing political and strategic contacts with China.

‘Australia’s view of China is caught between two opposing emotions: optimism and fear. We are enthralled with one of the world’s most dynamic economies, whose growth underpins Australia’s prosperity. But we are suspicious of China’s authoritarian political system, and worried about their potential to turn economic power into military and strategic muscle.’ Jennings says.

‘Moreover our links with China need not be a sum-zero game, where Australian gains in Beijing deliver us losses in Washington. In broad terms these are the objectives of Australia’s China policy right now.’

Jennings states that: ‘The test of Australia’s China policy will come over the issues that give rise to serious policy differences. But the growth of the bilateral relationship has led to rapid shifts in Canberra’s attitude to China; political relations have seldom been warmer.’

The ASPI Strategic Insight ooffers several new policy initiatives designed to promote Australia’s interests in China and to balance these interests against other vital national objectives.

Launch of Australian Strategic Policy Institute’s (ASPI’s) Policy Report on radical Islam and terrorism in Indonesia

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The Australian Strategic Policy Institute today released its report Local Jihad: Radical Islam and terrorism in Indonesia.

The report is authored by Dr Greg Fealy, research fellow and lecturer in Indonesian politics at the Research School of Pacific and Asian Studies and the Faculty of Asian Studies at the Australian National University (ANU) and Aldo Borgu, Program Director Operations and Capability.

‘The events of the past six years have prompted a dramatic reassessment of Indonesian Islam. What was once widely seen as one of the most tolerant and benign expressions of Islam in the Muslim world has recently come to be regarded as having more malign qualities. Recent violent radicalism in Indonesia is seen by many as a relatively recent phenomenon. But a closer look at modern Indonesian history reveals the inaccuracy of this view.’ Dr Fealy says.

‘The September 2004 bombing of the Australian Embassy in Jakarta demonstrated that Jemaah Islamiyah (JI) is still a force to be reckoned with. However, given that the blast came more than a year after JI’s last major operation, it raises questions about the organisation’s capabilities, strategic objectives and tactics. Answering these questions becomes more important in determining what our policy choices should be.’ Aldo Borgu states.

Terrorism might be a global issue but for Australia the threat is inexplicably tied up with the problems of the future stability of our neighbours, particularly Indonesia. This ASPI report reveals that while groups like JI might have global links, their motivations, recruiting and operations are inextricably caught up in regional issues. So in addition to our global efforts we also require a regional strategy tailored to regional solutions. 

The report makes a number of recommendations as to what such a regional strategy might involve including ongoing measurements of Indonesian public attitudes towards Australia; development of a public diplomacy strategy; improving our knowledge base on the terrorists themselves; widening our capacity building efforts with Indonesian agencies; expanding maritime cooperation and improving the coordination of intelligence and exchange of information within Indonesia.