Economic coercion tests international organisations

The rising use of economic coercion is a symptom of an increasingly unstable world that is struggling to contain rise of China and is no longer bound by the institutions established in the wake of World War II.

US President Donald Trump’s scattergun threats of punitive tariffs are a continuation of this trend. The Biden administration redoubled use of export controls to slow the spread of US technology to China. The West coordinated sanctions on Russia over its invasion of Ukraine, including the appropriation of its foreign exchange reserves. And China has repeatedly used boycotts and regulatory punishments targeting businesses of nations that have displeased it.

US legal firm Gibson Dunn, which tracks the use of economic coercion, says the Biden administration pursued ‘the most aggressive and far-reaching use of international trade tools of any US administration in history’. The number of individual designations under the US economic sanctions regime more than doubled to 16,400 in the past four years, with 3300 names added just last year.

The United States intensified its financial squeeze on Russia last year, imposing secondary sanctions on financial institutions of third countries that facilitated transactions with Russia’s military or industry, even if they had no knowledge of the prohibited activity.

The Biden administration also expanded the use of export controls on technology sales to China to cover artificial intelligence, quantum computing and chip-making equipment. A new development was a restriction on outbound investment in Chinese advanced technology businesses.

It is early days, but the Trump administration shows signs of further intensifying economic coercion. In its first three weeks, it issued direct threats of punitive tariffs on Canada and Mexico, demanding tighter border control on migration and fentanyl, and on Colombia, demanding it abandon its rejection of military deportation flights. Canada, Mexico and Colombia all took steps to appease the US.

Trump has also threatened punitive tariffs on Denmark and Panama, if they fail to hand over Greenland and the Panama Canal respectively. He has directed similar threats towards Egypt and Jordan if they fail to accept relocation of the Palestinian population.

The new administration is yet to spell out its policy towards Russia, however Trump threatened ‘high-level taxes, tariffs, and sanctions’ if it refused to negotiate over Ukraine.

The administration has also reinstated strict sanctions on Iran, including secondary sanctions on foreign organisations facilitating Iranian trade. It is unclear whether this will extend to Chinese banks, which the Biden administration was reluctant to attack. Furthermore, Trump has rescinded a deal negotiated by the Vatican under which the US would relax sanctions on Cuba and remove its designation as a sponsor of terrorism in return for the release of political prisoners.

China is ramping up export controls on critical minerals. Last December it banned the export of germanium and gallium, used for microchips, and antimony, used for ammunition, to the US. This month it added a requirement for government approval on the export of five further metals, including tungsten.

China is also restricting the export of critical minerals processing technology, which could affect planned rare earths and lithium processing plants in Australia.

Economic coercion has been accelerating alongside globalisation since the mid-1980s. As trade rose from 15 percent to 25 percent of global GDP, it became an attractive target. According to the historian Nicholas Mulder, sanctions were used twice as much in the 1990s and the 2000s as in the period from 1950 to 1985. Their use had doubled again by 2010. It has likely more than doubled once more since Russia’s attacks on Ukraine.

International trade agreements matter little when powerful nations use economic coercion. China ignored its 2015 trade agreement with Australia when it imposed bans on Australian exports. The US’s latest tariffs on aluminium and steel which have been justified on national security grounds, ignore both its trade agreement with Mexico and Canada and World Trade Organisation (WTO) standards.

China has foreshadowed a complaint to the WTO over the US’s 10 percent tariff on Chinese exports. However, the US has effectively shut down the organisation’s appeal panel as presidents, starting with Barack Obama, have refused to approve new members. The US contends that the WTO has facilitated the rise of China at the expense of US manufacturing.

During the first Trump administration, legislation was drafted to withdraw from the WTO. Now, an executive order that establishes a review of US participation in all multilateral organisations will likely confirm US withdrawal. The governor of the Bank of England, Andrew Bailey, has expressed concern that the review may also lead US to pull out of the International Monetary Fund and the World Bank.

Those organisations and the General Agreement on Tariffs and Trade, the predecessor of the WTO, were established in 1944 to avert the sort of breakdown in international economic relations that created the conditions for WWII. Seventy years on, they are proving to be inadequate brakes on the rise of economic hostility.

What Donald Trump can learn from allies on foreign aid

There are smarter and more effective ways to streamline and re-strategise US foreign aid.

The Trump administration is not the first Western government to envision a stronger, safer, and more prosperous country by integrating foreign aid with strategic objectives. The experiences of the United States’ Five Eyes partners, particularly Australia and Britain, offer encouraging evidence for reform, having achieved tightly targeted development programs supporting diplomatic and strategic priorities. They also offer sobering lessons about implementation pitfalls, including the abrupt disruption of established programs, especially those already aligned with strategic policy, loss of critical skills among government personnel and heightened unease among international partners.

The logic driving aid integration is compelling. In an era of great power competition, maintaining separate tracks for diplomacy and development is an unaffordable luxury. China has harnessed development, along with trade and financial investment, as an instrument of strategic influence through both soft and hard means. Both Australia and Britain recognised this reality, merging their aid agencies into their foreign ministries to create more strategically coherent development policies. Having made clear its intent to fundamentally reshape USAID, the Trump administration has the opportunity to learn from its allies in the pursuit of the American national interest.

A unified strategy: Australia 

The Australian government integrated the Australian Aid Agency (AusAID) with the Department of Foreign Affairs and Trade (DFAT) in 2013 with the stated goal of better aligning Australia’s development, foreign policy, trade priorities, strategies and objectives while bringing an enhanced focus on the Indo-Pacific. The integration accompanied a reduction of Australia’s development funding. After reaching a peak of more than $5 billion in 2013–14, or 0.33 percent of gross national income, Australia’s development budget has progressively declined. In 2023-24, the budget was $4.8 billion, or 0.19 percent of gross national income. This change is also stark in terms of the slice of the Australian budget spent on foreign aid compared to defence expenditures.

An independent review of the integration in 2019 found that 90 percent of the Australian government’s strategic targets for the integration had been met, driving development allocations towards infrastructure and the Pacific. The review also found ‘examples of development goals being more strongly advanced through joined-up, whole-of-department efforts.’

These initial efforts—such as the Pacific Seasonal Worker Scheme and the Australian Infrastructure Financing Facility for the Pacific—have since grown to enable more ambitious and innovative integrated development and strategic initiatives. Key among these are the Falepili Union with Tuvalu (which provides Australia with strategic denial rights and Tuvalu with climate resilience monies and opportunities for migration), the agreement between Australia and Papua New Guinea (which encompasses development and security elements) and Telstra’s acquisition of Digicel Pacific, the largest mobile provider in the Pacific, with the Australian government’s support amid rumors of interest from China Mobile. While the review stepped carefully around the issue, it found integration had increased Australia’s ability to counter efforts to overshadow Australia’s influence, like China’s Belt and Road and Digital Silk Road initiatives.

However, the review also found several areas of concern. Early morale problems among staff arising from the abrupt way the integration was implemented had largely dissipated by 2019, but a ‘pronounced deterioration in skills and systems’ remained. The review found that ‘almost 1000 years of experience left [government service] shortly after integration.’ Additionally, ‘estimates suggest another 1000 years of experience’ left the department in the five years before 2019 due to the department underestimating the capability needed to design and deliver development programming.

This loss of know-how continues to hamper effectiveness over a decade later. While development is now firmly accepted as a tool of statecraft, best wielded as part of a whole-of-government strategy, an article by the review’s author 15 months ago suggested DFAT still had room to improve in terms of fully harnessing its development delivery.

Strategic prioritisation: Britain

The merger between Britain’s Department for International Development and its Foreign and Commonwealth Office occurred in 2021. The principal intention behind the merger was to better align Britain’s development activities with its wider diplomatic, trade and geopolitical interests, both in strategic terms and in terms of in-country representation. The merger coincided with a decision to reduce the Britain’s development funding commitment from the 0.7 percent of GDP enshrined in law to 0.5 percent of GDP. Notably, the integration occurred while Britain was experiencing the economic slowdown of the Covid-19 pandemic, which resulted in a double blow to funding in absolute terms, constituting a 30 percent reduction overall.

Alongside the budget reductions, a strategic prioritisation of development initiatives was pursued, in which Britain focused on bilateral funding to a smaller group of countries where measurement of effect is often easier to determine, but at the expense of some wider bilateral and multilateral commitments which were deemed to deliver less tangible value to Britain.

In addition, Britain identified a select set of issues for its development focus, namely climate investments, girls’ education, and global health, where it had demonstrated expertise and where funding would have constructive spillover effects. For example, improving girls’ education is found to reap positive dividends for local security, prosperity and governance. These initiatives, concentrated in Africa, the Indo-Pacific and South Asia, are all areas in which Britain’s adversaries were harnessing development as an instrument of influence, dependence and coercion.

Britain’s National Audit Office (NAO) review of the progress of the merger in 2024 found positive evidence ‘of where a more integrated approach has improved the organisation’s ability to respond to international crises and events, which has led to a better result.’

Two such examples were Britain’s coherent humanitarian, diplomatic, and military response as the leading European power supporting Ukraine after Russia’s invasion, and the joint humanitarian and political response to the Ebola crisis in Uganda. The findings supported the rationale for the merger and the modernisation of the department as fit-for-purpose in sharpening the Britain’s geopolitical interests. However, the NAO also noted that ‘the indirect costs’ of the merger ‘in terms of disruption, diverted effort and the impact on staff morale should not be underestimated.’

The NAO also reviewed the effect of the overseas development aid reduction and found that while the prioritisation compelled in the government’s activities had some positive dividends, ‘the speed and scale of the budget reduction, and the lack of long-term planning certainty, increased some risks to value for money.’

What can the US learn?

These cautionary tales suggest some considerations for the Trump administration:

First, pace matters more than may be immediately apparent. While decisive action has its advantages, too rapid a transformation risks institutional damage that could take years to repair. Recipient partners need to be assured about the value of the relationship, as reputation matters when development partners have the luxury of choice. A phased integration that maintains critical expertise while gradually aligning strategic direction would likely prove more effective in the long term.

Second, capability preservation requires active management. Both Australia and Britain learned the hard way that development expertise isn’t quickly or easily replaced. The technical knowledge required for effective commissioning, procuring, financing and managing of development programs, while not unique to the aid world, is distinct from traditional diplomatic and geostrategic policy skills. Any US reforms must include concrete plans for retaining and developing each of these specialised capabilities and empowering them to work together to deliver coherent whole-of-government priorities.

Third, funding stability enables strategic coherence and builds influence with partners. Britain’s experience shows that simultaneous organisational and budgetary upheaval can undermine even well-conceived reforms. While efficiency gains are desirable, treating integration primarily as a cost-cutting exercise risks strategic self-harm. With strategic competitors snapping at our heels, such interruptions cannot always be remedied.

Fourth, clear metrics for success must encompass traditional development indicators and strategic effects. Australia’s focus on its immediate neighbourhood and Indo-Pacific infrastructure and Britain’s emphasis on areas of demonstrated expertise and reputational value offer useful models for linking foreign aid and development assistance to broader national interests.

The stakes for getting this change right are immense. China has outflanked the West in harnessing foreign aid as a strategic tool of statecraft, having learned from the experiences of Western development agencies. The US cannot afford to unilaterally disarm in this arena and sacrifice its many areas of retained advantage through poorly executed reforms.

Secretary of State Marco Rubio’s framework of strength, safety and prosperity provides useful guideposts. Development programs should demonstrably enhance US security partnerships, expand trade relationships that benefit US workers, or strengthen allies facing authoritarian pressure. Programs that cannot do this should be reconsidered.

Achieving these goals requires maintaining the US’s development capabilities even as they are more tightly aligned with strategic objectives. The experiences of Australia and Britain suggest this balance is achievable but demands careful attention to ensure areas of national strength and influence are strengthened, not squandered.

A political fix in hate-crime and terror legislation shows the government isn’t leading

After bowing to the opposition on mandatory minimum sentences, the Australian government needs to reestablish its leadership in national security.

Australia’s new anti hate crime amendment includes mandatory minimum sentencing for terrorism and certain hate crimes. The Labor government had resisted implementing mandatory minimums, but the Liberal-National opposition called for it.

Parliament passed the bill for the law, the Criminal Code Amendment (Hate Crimes) Bill 2024, on 6 February.

Introduced to the House in September, the law commendably extends protection against hate crimes to characteristics including gender, sexual orientation, sexual identity and disability. It also creates a new hate crime offence for damaging (or threatening to damage) property and motor vehicles.

As recently as 20 January, Prime Minister Anthony Albanese, opposing mandatory minimum sentencing in the bill, told the Australian Broadcasting Corporation that such a measure would lead to ‘counterproductive issues’.

The bill as passed, however, includes mandatory minimum sentences for:

—Committing a terrorist act or being a member of a terrorist organisation (six years);

—Financing terrorism (three years);

—Publicly displaying Nazi or terrorist organisation symbols or performing a Nazi salute (one year); and

—Advocating force or violence through damage to property (one year).

The effectiveness of mandatory minimum sentences is debated. Particularly within the legal community, there are concerns that they pose risks to the independence of the judicial system. Their inclusion in the bill is best explained as a government attempt to avoid amplifying the public national security discussion.

The opposition called for the measures six weeks before the bill was passed. It criticised the government’s handling of a range of national security issues, including the response to an arson attack on Melbourne’s Adass Israel Synagogue in December 2024 and, more recently, the prime minister not being briefed on an explosive-laden caravan in Dural, Sydney.

Mounting political pressure appears to be forcing the government’s hand. Albanese reportedly overruled Attorney-General Mark Dreyfus to support mandatory minimum sentencing. This isn’t the first time Albanese has changed his mind on criminal and security policy. He has done so on terrorism and sex crimes against children, so this latest decision doesn’t set a new precedent.

After the addition of mandatory minimum sentencing, Home Affairs Minister Tony Burke quickly shepherded the bill through Parliament, and there was reportedly little need for negotiation with the crossbench in the Senate.

Albanese’s apparent change of heart is a defensive move, protecting the government from further criticism. But the government’s role is to lead on national security issues—something it has struggled to do since the High Court’s 2023 decision in the case NZYQ v Minister for Immigration to release non-citizen criminal offenders held in indefinite detention.

National security demands greater attention. It is rarely the most important issue to the electorate, but poor national security records have bedevilled past governments.

The attorney-general and home affairs minister each have overlapping national security responsibilities, reflecting the unresolved departmental divide of policy and operational responsibilities. The government needs stronger and clearer messaging and policy, driven by a dedicated spokesperson.

ASPI’s Justin Bassi and John Coyne have argued that the muddled national security framework is diminishing departmental capacities to respond to counterterrorism and related issues. Similarly, the unclear division of responsibility appears to limit ministerial responsiveness, opening space for the parliamentary opposition to cut through.

Another issue is the overburdening of ministers. For example, Burke is also minister for immigration and multicultural affairs, cyber security and the arts. Minister for Foreign Affairs Penny Wong is also leader in the Senate. Deputy Prime Minister Richard Marles is also minister for defence. All three are highly capable, but they have been forced to juggle competing priorities. At this moment national security needs unwavering focus.

To reclaim leadership on national security, the government should develop effective policies that can be announced and implemented in the short term. A national hate crime register, for example, would provide a central data source for law enforcement, policymakers and researchers. Better understanding of the problem will allow us to better combat it.

The government should also provide more resources for law enforcement and intelligence to establish a national unit dedicated to combating hate crimes. This could fall within the Australian Criminal Intelligence Commission or a joint taskforce. Special operations currently address hate crimes, but a dedicated unit would provide permanent attention to this challenge.

Incumbent governments must assert themselves as national security leaders. Instead of conceding to implementing doubtful measures, the government should refocus its national security posture to develop effective policy.

Trump’s trade war is about more than trade

The opening salvos of US President Donald Trump’s trade war have sent shockwaves around the world. Over the past three weeks, his administration has broken with decades of free-trade orthodoxy, threatening to impose tariffs not only on strategic adversaries such as China but also on longstanding allies such as Canada and Mexico. Even Denmark—a NATO member and steadfast US ally during and after the Cold War—has found itself in Trump’s crosshairs.

Trump’s actions have made many in the United States and around the world wonder: what exactly are tariffs, and how do they affect global trade? Simply put, tariffs are taxes on imported goods. If a Chinese manufacturer wants to sell shoes in the US, the American government can impose a tariff. If a US retailer pays $100 for a pair, then a 10 percent tariff, like the one that Trump recently imposed on goods from China, means that the retailer must pay the US government $10.

Those $100 shoes now cost $110. Who pays the extra $10? When Trump raised tariffs on Chinese imports during his first term, US importers bore most of the cost, particularly when they could not find alternative suppliers. Consequently, retail prices remained relatively stable, at least in the first year.

But the picture becomes more complicated when tariffs remain in place for an extended period. US importers cannot absorb the added costs indefinitely and may go out of business unless they find new suppliers or pass those costs to consumers, who may then need to cut back on spending.

When one country uses tariffs or other sanctions to damage another country’s economy, the result is often retaliation and trade war. China, for example, responded to Trump’s tariffs by imposing its own tariffs on US imports. Yet, although Chinese and US tariffs are based on similar reasoning, their impact will not necessarily be the same.

During the first US-China trade war, most of the burden of China’s retaliatory tariffs was borne by American exporters rather than Chinese importers. This was because China quickly found alternative suppliers for the goods it had previously sourced from the US. Oil and food—two of the top US exports to China—were readily supplied by Russia and other countries. Meanwhile, the US struggled to replace Chinese imports, forcing US businesses and consumers to bear the brunt of Trump’s tariffs.

These consequences have not gone unnoticed. Under both Trump and former President Joe Biden, the US has taken steps to incentivise domestic production and encourage firms to reduce their dependence on Chinese supply chains. But the extent to which such efforts will enable the US to shift more of the tariff burden onto China remains unclear.

To be sure, the vast size of the US market gives it a significant advantage. While Chinese importers can find alternative suppliers, Chinese exporters will have a hard time finding a market that can fully replace the US. The combined GDP of Russia, India, Africa and South America amounts to $13 trillion—just over one-third of US GDP, which is projected to rise to $30 trillion in 2025. And if the US convinces its Organisation for Economic Co-operation and Development allies to join the trade war, China could face tariffs from countries representing 46 percent of the global economy.

The Trump administration is betting that because the US is the world’s largest economy, China and other foreign exporters will struggle to find viable alternatives. This, in turn, would give the US decisive leverage in the trade war between the two countries. Early signs suggest that Trump’s strategy may deliver at least symbolic victories, with Mexico and Canada seemingly acquiescing to his demands by promising to do what they were already doing.

That said, tariffs are often a double-edged sword. On one hand, winning the trade war with China would allow the US to negotiate better trade terms. But US households could pay a heavy price. Fewer goods would be produced and sold to US consumers. While reduced imports could boost the competitiveness of domestic manufacturers, higher production costs and the absence of foreign alternatives would likely drive up consumer prices.

The potential geopolitical benefits of Trump’s trade war are less ambiguous, as his administration has decided to use economic pressure to achieve broader strategic objectives. It seeks to pressure Mexico and Central American countries to stem the flow of migrants to the US southern border and accept deported immigrants, and to counter China’s growing influence in the Asia-Pacific region and rein in Chinese expansionism, especially in the South China Sea. Moreover, Trump has vowed to take back the Panama Canal, and he seems serious about buying Greenland for its strategic location and natural resources—a US ambition going back to 1868.

Consumers and manufacturers in the US, China and beyond must brace for price increases and escalating geopolitical tensions. If Democrats regain control of Congress in the 2026 midterm elections, in which one-third of the US Senate and the entire House of Representatives will be on the ballot, they could curb Trump’s ability to impose tariffs. This gives Trump two years to win his trade war with China and the rest of the world—or at least convince Americans it was worth the cost.

Why attack missile boats can’t replace major warships

Attack missile boats are no substitutes for the Royal Australian Navy’s major warships, contrary to the contention of a 4 February 2025 Strategist article. The ships are much more survivable than attack boats and can perform long-range operations that small vessels cannot.

In the article, the author argues, for example, that a single missile hit could cripple a billion-dollar warship. In fact, this is highly unlikely.

The planning for the number, type and direction of travel of missiles needed to successfully engage a warship is a tactical art. The calculations are classified, but the Salvo Equation is an unclassified means of understanding how many missiles must be fired to damage a major warship, such as a destroyer or frigate. The number is greater than most people assume.

The debate on warship survivability isn’t new, and it remains paper-thin. Warships are designed to float, move and fight. As the RAN’s Sea Power Centre describes, they are survivable ‘through layered defence systems, signature management, structural robustness and system redundancy’.

Just because a missile is fired doesn’t mean it will strike, and even a strike doesn’t ensure the ship is disabled.

It’s true that threats to warships close to coasts have increased, and the proliferation of uncrewed aerial vehicle, uncrewed surface vessels and anti-ship missiles has made operations more complex. However, as offensive threats evolve, so do defensive capabilities, tactics and procedures. This is the dance of naval warfare.

To bolster the flawed claim that warships are ‘increasingly vulnerable in modern conflicts’, the article points to the 42-year-old, poorly maintained Russian cruiser Moskva, which Ukraine sank in the Black Sea in 2022, as a ‘most advanced warship’. Yet far more modern US, British and French warships have repelled more than 400 Houthi missile attacks in the Red Sea since 2023 without sustaining damage. Fourteen months of Red Sea operations show that well-armed warships with trained crews are highly effective.

The article conflates strategy with concepts, saying ‘the urgency of shifting Australia’s naval strategy to distributed lethality cannot be overstated’.

Think of a naval strategy as the big-picture plan for what a nation aims to achieve at sea with its naval capability (as opposed to maritime), while a naval concept is the theoretical framework that explains how its navy might actually fight and operate to achieve those goals.

‘Distributed lethality’ fits within the established concept of Distributed Maritime Operations, which isn’t about any particular category of vessel, large or small; it’s a way of fighting that emphasises massed effects through robust, networked communications that allow for dispersal of maritime units.

At its core, it’s a network-centric, not platform-centric, concept—as applicable to a fleet of frigates and destroyers as to smaller craft.

It’s a concept the RAN, at least in theory, has already embraced. In a 2024 speech on Distributed Maritime Operations, Fleet Commander Rear Admiral Chris Smith said ‘distribution as a core concept of our operations … seeks to manage a defensive problem while seizing an offensive opportunity’.

Australian naval strategy: reach and balance

In advocating for a shift towards attack boats, the article dismisses their limited range and endurance as problems that are easily fixed. They are not: range and endurance are fundamental to Australia’s naval strategy and central to the concept of reach.

At its core, reach is the requirement for a maritime power to be able to protect its vital interests at range from its territory. As an island nation dependent on long sea lines of communication for essential seaborne supply—from fuel to fertiliser, ammunition and pharmaceuticals—Australia needs an ability to protect critical imports and exports.

Doing that requires the combination of sensors and weapons that cannot fit into an attack boat: heavy and bulky towed-array sonars, large radars mounted high, long-range air-and-missile defence systems, and helicopters for hunting submarines.

Acceptance that Australia’s vital interests at sea are far from its coast is inherent in the roles ascribed in Australia’s National Defence Strategy. They include power projection, such as the capabilities of the Australian Army’s new amphibious fleet, which require protection that attack boats can’t provide.

Limited endurance and operational range are deficiencies that cannot be mitigated by basing in northern Australia, as the article suggests. Territorial force posture such as northern operating bases cannot transform coastal green-water naval assets such as attack boats into the open ocean blue-water capability Australia requires.

Another key strategic requirement for Australia is having a balanced fleet, anchored by larger destroyers and frigates. The essence of the idea of a balanced fleet is that a smaller fleet of ships must operate across the spectrum of maritime tasks. Attack boats cannot fight effectively in all three spheres of maritime warfare: surface, air and sub-surface. While they may complement frigates and destroyers where the budget allows, they are unsuitable to form the backbone of Australia’s fleet.

The call for such vessels falls into the common trap of thinking that modern naval warfare is simply about missile capability. But what is needed to constitute a balanced fleet is a mix of capabilities that can be brought together only in a frigate or larger ship.

This debate is an opportunity to highlight a crucial issue often overlooked in Australian strategic thought. The country needs a naval strategy with genuine reach and a balanced fleet, capabilities that simply can’t be met by a force built around attack boats.

From the bookshelf: ‘Suharto’s Cold War’

The murder of six of Indonesia’s most senior army leaders on 1 October 1965 by elements of the country’s communist party became a major turning point in Indonesia’s modern history. It would bring to an end the first phase of Indonesia’s independence, under President Sukarno, the leader of Indonesia’s struggle for independence from the Netherlands.

In the ensuing turmoil, General Suharto was able to take control of the military, ultimately edging Sukarno out of the presidency and becoming the second and longest serving president of Indonesia.  Under Suharto’s leadership, the military and related organisations orchestrated a ‘politicide’ in which at least half a million leftists were killed.

In a recent book, Suharto’s Cold War: Indonesia, Southeast Asia, and the World, Mattias Fibiger takes us through subsequent events, as Suharto works to consolidate his regime and ensure that communism would never again take hold in the Indonesian archipelago. Fibiger, a professor at Harvard Business School, is the first scholar to offer a work of Indonesian history based on the central archival records of the Suharto regime.

A key theme of Fibiger’s narrative is the pivotal role of international capital in the global Cold War against communism. As part of his New Order policy, Suharto pursued international economic expertise and influence to rebuild the Indonesian economy and consolidate his power.

In the immediate aftermath of the murder of the generals, Suharto pushed Japan to halt economic aid to the Sukarno regime. This exacerbated Indonesia’s economic crisis, driving social unrest and helping bring to an end the Sukarno presidency.

Suharto then mobilised international aid from donors such as the United States, Japan, the International Monetary Fund and the World Bank. They shared a keen interest in supporting Suharto’s anti-communist regime. Thus, the Inter-Governmental Group on Indonesia was created, grouping donor countries to coordinate foreign aid to Indonesia and provide strong international support for economic recovery. Most importantly, although anti-communist, Suharto was no democrat. He was staunchly authoritarian.

To rebuild the economy, Suharto attracted international private investors to Indonesia’s rich natural resources, especially logging and mining. This enabled him to consolidate his anti-communist coalition by fending off internal opponents.

After the inauguration of a military aid relationship with the US, Suharto was able to buy the loyalty of the navy, a branch of the military that was loyal to Sukarno and had close links to Moscow.

While Cold War capital supported his authoritarian regime, Suharto would gain some independence with the rise in oil prices in the 1970s.

Suharto’s furthered his anti-communist campaign in Southeast Asia, working to ensure that Indonesia’s neighbours were governed by anti-communist governments and Chinese influence was contained.

For example, Indonesia joined forces with Malaysia to combat a communist insurgency on the island of Borneo where they share a border. And Suharto worked with President Marcos of the Philippines against the Moro secessionist movement.

Fibiger also argues that Suharto tried to remake Southeast Asia in Indonesia’s image by propagandising Indonesia’s national resilience doctrine. It promotes maintaining a strong, integrated system across all aspects of national life. Thus, when other Southeast Asian elites faced moments of political crisis, they would draw on this ideology.

Today, the Association of Southeast Asian Nations—a political and economic union of 10 states —that plays a major role in regional and global governance. But its creation in 1967—then counting just five members: Indonesia, Malaysia, the Philippines, Singapore and Thailand—was initially motivated by Indonesia’s desire to contain communism.

Suharto’s anti-communist campaign in Indonesia and further afield in Southeast Asia was an important phase in the global Cold War. Fibiger’s book provides fascinating insights into this period of history, including the ever-present encouraging hands of the US, Britain, Japan and Australia—although it is never clear what was the motivation for Suharto’s anti-communist tilt.

Much has also happened in Indonesia since these times. In the beginning of the 1980s, Indonesia’s domestic Cold War ended as political Islam was perceived as a greater regime threat than communism, according to Fibiger. Then followed the Asian financial crisis, the end of the Suharto regime, and democratisation.

But Indonesia remains a good partner of the West, even though it carefully avoids taking sides in the current great power rivalry. We can only regret that in recent years the US has had difficulty finding much time to invest in this important friendship—something which will likely get worse with the changes in Washington.

In its Indo-Pacific strategy, France should engage more with Pacific islanders

France is still expected to unveil a long-awaited update to its Indo-Pacific strategy. This should be an opportunity for it to do more in the region. 

Its current Indo-Pacific strategy relies on two visions: one is more defence-industry-oriented, focusing mainly on the Western part of this supra-region, and another is geographically and thematically more comprehensive. 

But France should also consider a bottom-up approach in the Pacific, focussed on engaging with Pacific islanders. 

Even if the word ‘inclusive’ was no longer used in President Emmanuel Macron’s speech in January, the idea is still in the air, as he said ‘there is no confrontation [with China]’. But an updated idea of inclusivity should extend beyond China to not only Pacific island countries but also local actors.  

In the Pacific, for now, Paris relies on little-known liaison officers (in Hawaii, Singapore and South Korea) plus officers of the Directorate of Cooperation of Security and Defence, in Indonesia and Fiji. Now France is increasing its presence. 

For example, last year, the ambassador to the Pacific moved from mainland France to New Caledonia.  

France is also doing more in terms of defence. In 2023 Macron announced the Pacific Academy, which will provide training for regional military and internal-security officials. As security competition increasingly extends to police forces—with Australia and China signing deals with various Pacific island states—France’s contribution is channelled through a Pacific police attache based in Canberra. 

France is also engaged in the region’s climate threats, having launched the Kiwa Initiative at the 2017 One Planet Summit in Paris. 

Furthermore, two years after Australia’s decision to shift to Britain and the United States as its future submarine partners soured relations with France, Canberra and Paris signed a new roadmap for bilateral cooperation in 2023. The roadmap promotes cooperation in the fields of defence, climate and education, with an emphasis on the South Pacific. 

As momentum builds behind an updated French Indo-Pacific strategy, it is time to pay more attention to Pacific island countries. To that end, France should highlight the idea of empathy and shift the focal point away from US-China competition to topics more aligned with the local concerns, particularly those related to human security—protecting rights, health and prosperity. 

For example, French and Pacific citizens are facing the same challenges at sea including illegal, unreported and unregulated fishing, rising sea-levels and possible ill-effects of deep-sea mining. France has long experience in maritime domain awareness. This means it can contribute to regional maritime security efforts. 

Satellites of France-based Unseenlabs can locate ships using radio-frequency detection,  complementing US maritime domain awareness activities in the region. And France was the first to provide assistance after the natural disasters in Tonga in 2022 and in Vanuatu in 2024 through the established France-Australia-New Zealand trilateral aid mechanism. 

In January, the French-led military Exercise La Perouse, named after a French naval explorer, kicked off with eight other Indo-Pacific navies. In the spirit of the explorer, who criticised those who ‘write their books by the fireside’, France should consider other avenues to engage with Pacific islanders themselves. 

For a start, France should be more attentive to the Pacific young leaders. If not, other countries will not wait to offer them grants and to profit from their burgeoning expertise. 

Secondly, in an age of information warfare, contributions to regional media, offering translations and different views, have heightened importance. The Pacific Islands News Association has previously provided a French version of its newsletters. Reviving this could be reconsidered. 

Thirdly, local leaders, NGOs and keepers of ancestral knowledge should be closely involved and associated with the process of applied research. 

To sustain such dialogues, Paris might soon rely on Noumea’s emerging (geo)political science research community. Similarly, the University of French Polynesia could be organising a third edition of its conference series on Great Powers in the Pacific. 

Even at the regional level, Indo-Pacific strategies are not so open or inclusive, despite a new focus on the Global South. While minilateral forums create the impression of a close-knit and liberal diplomatic community, exclusively built around like-minded, great and middle-ranked powers, the time has come to gather more widely. With this aim, there is no need to reinvent the diplomatic wheel when one can, for example, build on the promising Pacific Dialogue on Security in Suva. 

Taking inspiration from the long-discussed centrality of the Association of Southeast Asian nations, a think tank supported by regional universities or an annual 1.5 dialogue—such as those in Singapore, Manama, Dakar and Munich, but enriched with more local participants—might offer opportunities for Pacific island states to recentre talks around themselves and set the agenda. 

New Zealand’s trouble in paradise

New Zealand is taking too hasty and too abrasive an approach to Pacific islands, putting leadership in the region on edge. We see this in a bungled attempt to visit Kiribati that led to a threat to withdraw aid and in a tense public stand-off with Cook Islands over a looming agreement with China.

In January, Kiribati President Taneti Maamau told New Zealand Deputy Prime Minister Winston Peters he would be unavailable to meet during a trip by Peters to Kiribati. On receiving the news, which came only a week before the scheduled visit, Peters and the New Zealand delegation chose not to meet with another Kiribati representative and instead cancelled the trip.

Shortly after, Peters said New Zealand would review its aid to Kiribati.

While Peters regrets the publicity that the issue has generated, he has continued to stress that accountability works both ways in the Pacific. New Zealand had a responsibility to its taxpayers to ensure international aid is meeting its objectives, he said, adding that ‘the lack of political-level contact makes it very difficult for us to agree on joint priorities’ and ‘deliver good value for money.’

Peters isn’t necessarily wrong. It is hard to deliver support without talking things over at the right levels. But the sudden change in approach was abrasive and has only worsened relations. Other statements from Peters, such as labelling the Pacific ‘our backyard’, come with paternalism.

New Zealand is not alone in its frustration with Kiribati. Australian diplomats have struggled to engage optimally there for quite some time, and Maamau, to focus on domestic issues, suspended international diplomatic visits to the country in the lead up to its elections last year. Since his re-election, Maamau appears to have doubled down, delegating bilateral engagements to other ministers.

Australia recently faced a choice similar to New Zealand’s. However, Australian Deputy Prime Minister Richard Marles stuck with a plan to travel to Kiribati to deliver a patrol boat, even without an opportunity to meet Maamau. Australia ‘remains committed to its longstanding partnership,’ he said. Commitment through frustration is a healthy way to mend partnerships.

Australia also faces the challenge of justifying spending in the region to its taxpayers, particularly after the announcement of a $600 million deal to set up a Papua New Guinea team in the National Rugby League deal. But in that case, it is justifying additional support, whereas Peters has raised the possibility of taking away existing support that is highly valuable for the 120,000 people of Kiribati.

There is some concern that if the relationship continues to sour, New Zealand will be pushing Kiribati towards China. Beijing has an embassy in the country and police on the ground providing training and other assistance. While New Zealand has provided more than $90 million in aid since 2021, its support remains appreciated but not irreplaceable. Following through on threats to step away will only take New Zealand out of the contest, placing more pressure on Australia and the US to pick up the slack before China does. New Zealand should show patience and commitment to its partnership with Kiribati.

Now, New Zealand’s attention has shifted to a closer member of their Pacific family: the self-governing country of Cook Islands, which is in free association with New Zealand.

Cook Islands Prime Minister Mark Brown says he will visit Beijing this week to sign a comprehensive strategic partnership with China and will not need New Zealand ‘sitting in the room’. Brown said he had assured New Zealand ‘over and over’ that there would be no surprises in relation to security and that Cook Islands would announce the details of the agreement publicly once it was signed.

The country’s free association with New Zealand means that the nation conducts its own affairs, but New Zealand assists in defence, disaster relief and foreign affairs. We don’t yet know whether the strategic partnership agreement with China will relate to these subjects. Brown has reiterated that New Zealand has its own comprehensive partnership with China and didn’t consult the Cook Islands when agreeing to it, nor did he expect it to.

Again, in engaging with Cook Islands, New Zealand’s abrasive public response has caused friction. Last week, a Cook Islands proposal to create its own passports was abandoned after New Zealand, in Brown’s words, ‘bared its teeth in response’.

New Zealand needs to be cautious in its responses to Pacific island actions.

Even if the deal between the Cook Islands and China is revealed as disagreeable, its intentions might not ultimately be achieved. When details are available, New Zealand should encourage community consultation. It can still express concerns fairly and detail why certain objectives might affect its relationship with Cook Islands.

Stubbornness will not aid engagement with the Pacific family. Increasing support, not withdrawing it, will demonstrate what can be gained from greater partnership and trust.

Undermining unity: Disinformation as a threat to the Quad

Disinformation campaigns targeting the Quad, a partnership between Australia, India, Japan, and the United States, challenge its credibility. These campaigns, often state-linked, misrepresent Quad initiatives, exploit internal differences among its members and portray the group as warmongering. This erodes public trust in the Quad, heightens geopolitical tensions and complicates regional cooperation.

The origins of the disinformation campaigns are not completely clear, but it can at least be said that they suit the purposes of China and, perhaps, Pakistan.

The Quad promotes a free, open and prosperous Indo-Pacific by addressing challenges such as health, climate change, cybersecurity and infrastructure development. However, intensifying geopolitical tensions have exposed a fundamental limitation: the Quad’s reluctance to explicitly focus on security challenges. This strategic ambiguity makes the partnership vulnerable to disinformation campaigns. These campaigns often spread false or misleading information to manipulate public opinion, targeting the group and its members.

Two narratives dominate disinformation campaigns targeting the Quad. The first, and most persistent, frames the Quad as a security alliance formed to contain China. This stokes fears of open confrontation caused by Quad involvement in Indo-Pacific disputes, such as the South China Sea and Taiwan.

To support the false narrative, evidence is often fabricated. For instance, in September 2024 an image of a 2017 US-Japan military drill was falsely presented as a standoff between Chinese and US vessels in the South China Sea. The image (below) was used as a thumbnail for a video claiming that the Quad was preparing for military confrontation with China in the South China Sea. The video, which was viewed almost 200,000 times, was posted on a channel that had repeatedly shared misinformation.

The second dominant narrative exploits political and interpersonal differences among Quad members to sow discord. Some campaigns highlight strategic divergences, such as India’s historical non-alignment, Australia’s rebuilding of economic ties with China and Japan’s pacifist stance. Others target relationships between leaders. For example, during the September 2024 Quad summit, a video doctored to depict then US president Joe Biden showing disrespect to Indian Prime Minister Narendra Modi circulated widely. It was aimed at inflaming anti-US sentiment in India.

Disinformation campaigns also exploit issues that indirectly weaken the Quad’s cohesion. Immigration has been used as a wedge issue, with false claims circulating that US President Donald Trump planned to deport 18,000 illegal Indian immigrants as soon as he was inaugurated. Media monitoring revealed that accounts such as @PSYWAROPS (below), which predominately follows Pakistani sources, shared pieces of false information to strain US-India relations and undermine India’s domestic confidence in the partnership.

Health security, a central focus of Quad cooperation, has also been targeted by disinformation. Japan has been falsely accused of labelling mRNA Covid-19 vaccines as deadly. This was done by misrepresenting a Japanese press conference. These claims were first shared in simplified Chinese and spread across platforms such as X (below), Facebook and Weibo.

Such disinformation is particularly damaging, as the Quad Vaccine Partnership was designed to bolster regional health security. With the US hosting Pfizer-BioNTech’s supply chain and Australia opening a Moderna vaccine facility in Victoria last year, these false claims risk damaging the Quad’s credibility in delivering health initiatives.

Another example emerged in 2022, when online users masquerading as local activists falsely said a planned facility in Texas of Australian mining company Lynas Rare Earths would cause pollution. Although this disinformation primarily targeted Lynas, it indirectly affected the Quad’s work to secure its supply chain, as the company was selected by the Pentagon to develop the initial engineering and design for the commercial heavy rare earths separation facility in the US.

Although the immediate effect of these disinformation campaigns on Quad’s cohesion has been limited, their potential for long-term harm is significant. Persistent and convincing false narratives could erode public trust, reduce domestic support for Quad initiatives and hinder its ability to build stronger security partnerships. Narratives framing the Quad as belligerent, divided and ineffective not only diminish its legitimacy; they also complicate its ability to keep the Indo-Pacific free and open.

To mitigate these risks, the Quad should adopt a more coordinated and proactive approach. It should continue to cooperate, including through regular information-sharing on measures against disinformation. Additionally, collaboration with regional organisations such as the Association of Southeast Asian Nations could further build resilience against disinformation through joint capacity-building and media literacy programs.

Furthermore, engaging with social media platforms to address vulnerabilities, promote transparency, and improve content moderation can help combat disinformation. Japan’s recently launched public-private partnership project to improve technological literacy offers the Quad a model initiative.

Neither Atlanticist nor isolationist: recognise Trump as an imperial nationalist

Like people in other regions, Europeans face the challenge of discerning what motives underlie US President Donald Trump’s verbal provocations. After all, what Trump really wants is often unclear, which makes it difficult to devise a strategically effective response.

Traditionally, Europeans have interpreted US foreign policy through a binary lens: either a US administration is Atlanticist, in which case all is well (for the most part); or it is isolationist, which spells trouble. But Trump fits neither category.

He is certainly no Atlanticist, because he is convinced that NATO offers insufficient benefits for what it costs the United States, and that Europeans are all free riders. But he is hardly the first US leader to make this criticism. US complaints about European free-riding date to at least to the early 1950s, when NATO was just taking shape. The difference between Trump and his predecessors is that he puts a much higher price tag on protection by the United States and views it as something that Europeans do not really deserve.

But nor is Trump an isolationist, though many commentators describe him in these terms. Trump does not think only in crude transactional terms. He believes that the US is owed all the perks of hegemony, but with none of the costs. Rather than an isolationist, he is an imperial nationalist, like many 19th-century US leaders. Even his preferred policy instruments for ushering in a golden age—tariffs and territorial expansion—recall that era.

For Europeans, both seem absurd today. But from a US point of view, they have a historical resonance. The US’s war for independence began with a conflict over tariffs, which have since been seen as an instrument of sovereignty. The US is one of the few countries in the world whose constitution explicitly mentions trade. Even if tariffs tend to harm domestic consumers, they serve a political function.

This is reflected in Trump’s proposal to create a new External Revenue Service which would centralise tariff administration and serve as a depository for tariff revenues. With such an agency, Trump would have the means to redistribute revenues among states and political clients as he wished. He pursued a similar strategy during his first term when he established a fund within the Department of Agriculture to compensate those harmed by China’s retaliatory measures against US soybean exporters.

But the most important objective, of course, is to use tariffs to exert pressure on partners that are particularly dependent on the US market: Mexico, Canada and Europe. In the case of Canada and Greenland (an autonomous Danish territory), Trump has also expressed territorial ambitions, wishing to ‘get Greenland’ and make Canada the ‘51st state.’ Commercial pressure is thus a means of achieving territorial expansion, just as it was for the US in the 19th century.

In pining for a US geostrategic fortress stretching from Greenland to Mexico, Trump is unwittingly echoing a US State Department document from the middle of the 19th century which stated that the acquisition of Greenland would ‘flank British North America for thousands of miles on the north and west, and greatly increase her inducements, peacefully and cheerfully, to become a part of the American Union.’

Europe has understandably been left in a state of shock by Trump’s decidedly non-Atlanticist, non-isolationist geopolitical project. What can be done? Should we simply pray that it will not happen? That, more or less, has been the response from the European Union’s new high representative for foreign affairs and security policy, Kaja Kallas. In one of her first public statements, she said little about the threat from the US, because she is primarily concerned with just one issue: maintaining transatlantic solidarity to confront Russia in Ukraine. But laudable though this objective may be, it takes two to tango.

Meanwhile, no European official has bothered to mention the EU’s Anti-Coercion Instrument, which permits retaliatory tariffs to be imposed against any state that would use trade restrictions for geopolitical purposes. If Trump decides to intensify his pressure on Denmark through high tariffs, the EU will have no choice but to trigger this mechanism. To do otherwise would be to confirm—and exacerbate—its own geopolitical weakness.

For the same reason, the Danish government is wrong to play the appeasement card. Obviously, the balance of power is not in its favour. But by making no secret of its fear, it is inviting Trump to be even more aggressive.

While it does not make sense for Europe to deploy troops to Greenland—which would either look ridiculous or create the possibility of a war with the US—nor does it make sense to grovel. Whatever happens, Russia is the biggest winner for now. While Europeans hem and haw, no one should be surprised if the White House and the Kremlin negotiate the future of Ukraine behind closed doors.