Balancing the offensive and defensive in the AUKUS innovation agenda

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Intensifying geopolitical competition is having an adverse effect on the internet and innovation. Russia’s invasion of Ukraine, increasing Chinese aggression in the South China Sea and the lack of an Iran nuclear deal are contributing to the weaponisation of cyber technologies and the raising of technology barriers.

At the same time, Web3—a new iteration of the internet—and the technologies that enable it, such as blockchain, are developing systems that are increasingly decentralised, permissionless and not reliant on governments and organisations to facilitate trust. Amid these polarising tensions, Australia, the United Kingdom and the United States have proposed new levels of technology sharing through the AUKUS agreement.

‘Blocking’ the enemy has become a hallmark of modern hybrid warfare. The war in Ukraine has demonstrated the application of novel tactics and attempts by both sides to ‘unplug’ the adversary. Persistent, distributed denial-of-service attacks by Russian botnet armies, such as Killnet, against Ukraine and its supporters are now standard disruption and sabotage tactics. Ukraine’s more extreme approach of asking the Internet Corporation for Assigned Names and Numbers to restrict Russia’s internet access exemplifies a ‘digital iron curtain’ attempt to advance sovereign goals, the possible long-term consequences of which policymakers have yet to flesh out.

Outside of active conflicts, governments around the globe seek more digital sovereignty, self-sufficiency and, increasingly, restrictions on information sharing. The Chinese Communist Party has long sought to censor and disengage from the global internet through its ‘Great Firewall’, which involves a ban of Facebook and development of alternatives to Amazon, such as Alibaba. Beijing’s establishment of a ‘metaverse industry committee’ in November similarly speaks to a pre-emptive attempt to set the rules for the emergence of Web3 and metaverse-enabling technologies. Similar attempts have been made by AUKUS members. The ongoing campaign in the US to ban video-sharing platform TikTok is an example of geopolitical tensions and security concerns affecting the access developers and creators have to foreign technologies and networks.

President Joe Biden recently signed an executive order requiring the Committee on Foreign Investment in the United States to tighten its focus on advanced technologies, including information and communication technologies. The aim is to address the government’s concerns about what data Beijing can access, as well as to prevent supply-chain dependencies and the enabling of technology advances that aid Chinese military capabilities.

Similarly, the CHIPS and Science Act 2022 speaks to the Biden administration’s supply-chain concerns. The act announced US$52 billon in incentives for domestic production of semiconductors, which are used in computers and other electronic devices. Currently, 92% of the world’s supply is produced in Taiwan. The act also provides incentives for investment in critical sciences and technologies with the intention of strengthening homegrown capabilities.

What’s occurring is a trade-off between national security and access to global platforms, ideas and networks that aid innovation, and the market competitiveness that drives it. The by-product of innovation and market competition is more effective development of advanced technologies that have both commercial and defence applications. The need to develop compatible and effective channels for communication and technology sharing between AUKUS members is vital to the success of the agreement. Currently, however, this is not default government behaviour.

Despite the influence of geopolitical tensions on cyberspace and technology, entrepreneurs find ways to circumnavigate policy. Ukraine’s use of blockchain technology to fund defence efforts and Russia’s use to avoid economic sanctions demonstrate how these technologies operate without bias or morality. A hallmark of Web3 development is its resistance to censorship. Decentralised technology enables individuals to own their data and to select preferred platforms, since user communities rather than an overarching authority manage and moderate content and user data. The technology is still in its infancy, but the ability for governments to implement effective policy controls is limited. AUKUS is occurring in this context.

Under the AUKUS agreement, technology sharing is intended to result in increased capability among the three partners to strengthen regional deterrence against Chinese or other foreign adversary aggression. Using AUKUS as a vehicle to deepen ties between Australian, US and UK technology industrial bases is a sea change from traditional tendencies to favour sovereign capabilities over coordinated and open sharing of advanced technologies.

There is an opportunity and need to prioritise information and cyber technologies, such as Web3 and blockchain, that both aid in transparent and secure information sharing and ensure that innovation is compatible with their rapidly developing characteristics. The failure of AUKUS to do so could have a negative impact on the effectiveness of subsequent initiatives, already evidenced through the ability for emergent technologies to circumvent traditional policy and cyber barriers. It could also dampen industry’s incentive to innovate and commercialise these technologies, which could lead to an exodus of skilled labour to nations with laws that enable less constrained innovation and allow access to the necessary networks and data. For Australia, talent shortages are already a significant capability limitation that affects its ability to contribute to or retain technology gains achieved through AUKUS.

Eight of the 17 AUKUS working groups focus on advanced technology capabilities, and they should collectively consider the long-term implications of developments for industry and how they can focus on prioritising the strategies and frameworks that enable sharing between nations while strengthening their own commercial relationships. Ultimately, technology sharing, particularly in the advanced cyber, innovation, artificial intelligence and information-sharing working groups, should be constructive, be compatible with peacetime operations and reinforce secure and open digital connectivity with non-member nations, including long-term, stable engagement, at least commercially, with adversaries.

The internet and emergent technologies exist in a borderless domain. A defensive approach to innovation and ongoing efforts to block adversaries’ engagement in these spaces—or limit domestic engagement—are not sustainable. Technology will continue to find ways to overcome these efforts. Such behaviour is also likely to exacerbate tensions between governments and the private sector, which would be counterproductive to the cooperation required for technological advancement. AUKUS technology initiatives should be conscious of industry partners. The AUKUS members also need to think creatively about how defensive goals can be achieved in a way that’s compatible with the underlying characteristics of new technologies.

AUKUS’s technology-sharing goals represent a significant opportunity for Australia to bolster its capabilities, industry skills and expertise. The consequences will feed into the private sector. The challenge will be ensuring that defensive developments designed to protect AUKUS members are compatible with policy that encourages open but secure digital engagement.

This piece originally published on The Strategist. 

Despite progress, major challenges lie ahead for AUKUS

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Discussions during a trilogy of AUKUS-related events in Washington on the one-year anniversary of the deal’s announcement suggest the novel strategic partnership is about much more than submarines, the transfer of nuclear propulsion know-how and Anglosphere chumminess.

Political officials, scholars and practitioners gathered last week under the auspices of ASPI, the Center for New American Security and the Centre for Grand Strategy at King’s College London to identify key successes and primary challenges for the partnership.

The political leadership in all three countries appears fully aboard with AUKUS—the deal has survived a change in government in Australia and a change in prime minister in the UK—and officials describe levels of cooperation not seen since World War II to streamline advanced technology sharing. Participating officials described AUKUS as a new paradigm of defence integration across a broad spectrum of advanced technologies to maintain scientific and engineering advantages while improving a collective defence posture among the three countries.

For the US, this project represents an overdue shift of attention to the Indo-Pacific and a determined effort to make good on longstanding promises of a geostrategic pivot to the region and the looming Chinese threat with the help of steadfast partners. It also portends a change in the American approach to alliance capability sharing. AUKUS helps to further anchor Australia in the American defence orbit and should make Beijing think hard about how to respond to a Canberra that’s increasingly willing to push back against Chinese aggression. In the UK, the AUKUS agreement is seen as necessary to show strength alongside allies with shared interests and values, but also as part of the UK’s new ‘global Britain’ strategy in the wake of its departure from the EU.

The much-publicised submarine component of the pact—so-called pillar 1—appears to be moving forward apace. All parties expect that a plan to provide Australia with nuclear-propelled submarines will be announced, as scheduled, in March. The details are being held close by officials, but a year into talks, confidence is growing that delivery may occur earlier than the parties expected at the beginning of discussions. Besides the actual capacity-enhancing propulsion technology transfer, AUKUS partners see pillar 1 as a ‘big bet’ signal that will demonstrate a capacity to meet the defence coordination challenges of the second pillar, relating to artificial intelligence, quantum computing and other emerging technologies.

The decision of the AUKUS partners to take their case for the sharing of nuclear-propulsion technology to the International Atomic Energy Agency in the interests of transparency, and the response from most of the international community to consider, accept or support the argument in good faith, portend success for pillar 1. Some allies and partners have expressed concerns about AUKUS’s effects on nuclear proliferation and possible further destabilisation of the Indo-Pacific, but the Chinese information campaign to discredit AUKUS has so far failed to gain much traction.

Despite widespread support for AUKUS and a desire for its success, three pressing issues were repeatedly raised throughout the discussions.

First, there is a lack of clarity around AUKUS’s strategic purpose and what each partner aims to achieve. The inability to define specific, shared goals beyond banalities of protecting the ‘rules-based order’ or technology sharing to ‘deter Chinese aggression’ may belie a failure to identify different threat perceptions and risk appetites, which, if accounted for, help determine how to rank the technologies that are critical to advancing specific interests for each partner.

Does AUKUS strengthen integrated deterrence against a common threat, namely China, or may some technology transfers—even discussion of them—trigger escalation in some scenarios? If power projection is itself a goal for one or more of the partners, pillar 2 activities need tailoring. It is understandable that more time is needed here given that the efforts under pillar 1 are the initial priority. Determining metrics for measuring AUKUS’s worth is necessary before making any further claims of success, however.

Second, the story of AUKUS—or lack of one—also poses a challenge. The narrative on the need for the deal in the first place hasn’t really registered beyond nuclear submarines meeting Australia’s defence needs, resulting in confusion from regional allies and partners, and giving rise to concerns that AUKUS could destabilise the Indo-Pacific region. Canberra, London and Washington need to have explicit and uncomplicated discussions with allies and partners about what they intend the deal to accomplish more broadly.

Is AUKUS a trial run for a similar, future initiative with Japan, France or other countries in the Indo-Pacific? The potential for Chinese disinformation to colour perceptions of the deal will grow the longer that the AUKUS members delay announcements and fail to fully explain its parameters and objectives. This effort will require the AUKUS partners to gain a more comprehensive understanding of why allies and friends may be sceptical, regardless of Chinese influence.

Finally, a major concern is the failure so far of AUKUS partners to assess the role of commercial industry, supply chains and broader society in enabling pillar 2 to succeed. Shared bureaucratic, legal and practical infrastructure is needed to support sustained advanced technology sharing across myriad critical technologies—all of which are at various stages of development. Each partner needs to conduct a comprehensive review of its supply chains and skills gaps to ensure shared technology is utilised and retained.

Pillar 2 is fundamentally different from pillar 1. A top-down approach needs grassroots support for AUKUS to succeed. Pillar 2 exceeds the scope of traditional defence capability sharing, and this alone will necessitate creative and uncomfortable changes at all levels to ensure its success. Long-term momentum may be difficult to sustain without greater industry and civil-society stakes in AUKUS’s development and a better understanding of its potential benefits. Domestic diplomacy will need the support of think tanks, educational institutions and ‘track 2’ planning to clarify and refine AUKUS over time.

North of 26 degrees south and the security of Australia: views from The Strategist, Volume 5

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The Northern Australia Strategic Policy Centre’s latest report is a series of articles published in The Strategist over the last six months, building on previous volumes by identifying critical intersections of national security, nation-building and Australia’s north.

This issue, like previous volumes, includes a wide range of articles sourced from a diverse pool of expert contributors writing on topics as varied as biosecurity, infrastructure, critical communications, cyber-resilience, maritime infrastructure, foreign investment, space, and Indigenous knowledge-sharing. It also features a foreword by ASPI’s new Executive Director, Justin Bassi.

The 19 articles propose concrete, real-world actions for policy-makers to facilitate the development, prosperity and security of Australia’s north. The authors share a sense that those things that make the north unique – its vast space, low population density, specific geography, and harsh investment environment – are characteristics that can be leveraged, not disadvantages.

ASPI launches Washington DC office

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Australia’s first overseas think tank presence was officially opened today by Deputy Prime Minister and Defence Minister of Australia, the Hon Richard Marles MP.

The Australian Strategic Policy Institute (ASPI) has gained global attention for its research and today launched its office in Washington DC.

The Deputy Prime Minister said, ‘in so many ways, the product of ASPI is critically important, not only in informing the Australian public, but those of us in government who seek to play a role in this space.’

On the importance of think tanks, Marles stated: ‘for those of us who believe in democracies, it’s really important that the value of modern democracies is advocated.’

ASPI Executive Director, Justin Bassi, said ‘as one of the most important US allies, it’s important Australia is competing in this marketplace, and providing US decision makers and the US public with a perspective from the most critical part of the world.’

ASPI’s Washington presence will be led by Mark Watson, a former lawyer and diplomat with over thirty years experience in international relations and national security.

ASPI’s DC office will build on its existing great reputation in the United States by serving a unique role as an authoritative Australian voice in the American capital for think tank perspectives on Australian security, defence and foreign policy.

Australian views on the Indo-Pacific Economic Framework

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Australian officials surveyed for this research view the Indo-Pacific Economic Framework (IPEF) as an opportunity to bring more investment into the Indo-Pacific region, shape standards setting, form collective solutions to supply-chain risks, and influence the direction of clean energy infrastructure. The IPEF is viewed as a potentially innovative way to boost regional investment rather than as a mechanism to strengthen the usual substance of trade agreements, such as market access into the US.

While we note that the officials interviewed aren’t the ultimate decision-makers and that there’s a new government in Canberra with its own emerging priorities, this report offers insight into the potential opportunities for Australia to shape the framework.

ASPI appoints inaugural director of Washington DC office

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ASPI is delighted to announce the appointment of Mr. Mark Watson as the inaugural director of ASPI’s Washington DC office.

With more than 30 years’ experience in national security and international relations, Mark comes to ASPI with expertise in policy analysis, stakeholder mapping and engagement, strategic planning and business management, and public-private partnerships in the national security community.

Mark is a trained Chinese linguist, holding degrees in Law and History from the University of Sydney, an Honours degree in Strategic Studies from Deakin University and a Masters degree in Public Policy from the University of New England. He also completed post-graduate studies in the Economic and Civil Law of the People’s Republic of China at the University of Hong Kong, and is a graduate of the Senior Executives Leadership Program at the Kennedy School of Government at Harvard.

During his time as a diplomat, Mark had postings to Port Moresby, Hong Kong, Singapore, London and, most recently, at the Australian Embassy in Washington DC. In that role, Mark was responsible for maintaining and developing partnerships with US Defence, national security and policy analysis communities, as well as with the private sector companies supporting those communities.

Most recently, Mark established Sydney Avenue Consultants; a strategic advice consultancy specialising in national security and defence community issues. He is also currently the National Security Strategic Adviser at Bondi Partners.

ASPI’s Executive Director Peter Jennings welcomes the new appointment and said Mark would reinforce ASPI’s commitment to become a more active participant in United States think tank debates about defence and national security, and to strengthen the US-Australia relationship. Mark’s knowledge of the Washington DC stakeholder environment and leadership experience will be invaluable for establishing ASPI’s presence in DC.

‘I really feel a great of sense of responsibility in opening ASPI’s first overseas office, particularly one located in a city I know well – Washington DC. It is a unique opportunity for ASPI and for me personally, and I am looking forward to getting to the US as soon as possible to get the office up and running,’ comments Mark on his appointment.

‘This move comes at a time when the US-Australia alliance has never been more integral to Australia’s strategic planning than it is following the announcement of the AUKUS agreement. As President Biden said at the launch of AUKUS: “This is about investing in our greatest source of strength — our alliances — and updating them to better meet the threats of today and tomorrow.”

‘That is a sentiment that I think applies equally well to ASPI and the reason we are opening an office in Washington at this time. To help Australia better meet the threats of today and tomorrow.’

We are excited to welcome Mark to the ASPI leadership team and look forward to working with him. Mark will join us in Canberra until January 2022, when he is anticipated to be on the ground in DC.

ASPI to open an office in Washington DC

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Today the Minister for Defence, the Hon Peter Dutton, MP announced that the Australian Government will support the Australian Strategic Policy Institute to open an office in Washington DC.

Chair of the ASPI Council Lt Gen (Ret’d) Ken Gillespie said “The whole ASPI team is delighted at the Government’s decision to support the opening of a Washington DC Office.

We are particularly pleased that this comes at the time of the 70th Anniversary of the US-Australia alliance and also in ASPI’s 20th year of operations.

Australia has a deep interest in contributing to strategic policy thinking in Washington DC through that city’s lively think tank community.

I am grateful to Mr Dutton for his endorsement of the quality, depth and value of ASPI’s work in contributing to contestability of policy advice.”

How the United States of America engages with the Indo-Pacific region, with China, with America’s regional friends and with treaty allies matters profoundly to Australia and to global security.

ASPI will seek to further strengthen the bilateral relationship by becoming a more active participant in United States think tank debates about defence and national security. 

These think tanks are often the source of new policy ideas and are designed to be able to experiment, develop and explain innovative policy ideas.

The Executive Director of ASPI, Peter Jennings said: “ASPI’s Washington DC office will operate as a branch and be an integral part of ASPI in Canberra, as such, the business model will mirror ASPI’s which has been successfully developed over twenty years.

ASPI’s work focuses on non-partisan empirically grounded original research, a capacity for policy innovation and an ability to shape real-world policy outcomes.

We are proud of the achievements of the organisation over the past twenty years and look forward to the next twenty.

We thank the Minister for Defence for his support to ASPI as well as for the continuing support the Institute receives from Parliament, the Defence organisation and the wider public service, our sponsors and supporters.”