Governance reform is key to reviving China’s economy

When it comes to economic slowdowns, things often get worse before they get better. This is being borne out in China, following the government’s introduction in late September of its biggest stimulus package since the COVID-19 pandemic.

The government’s announcement took many by surprise, but abrupt policy shifts are nothing new for China. The regulatory crackdown on the internet sector in 2021, the end of the zero-COVID policy in 2022, and the changes to fertility rules since 2014 were similarly sharp reversals.

In my recent book, High Wire: How China regulates Big Tech and governs its economy, I explain that Chinese policymaking has three defining features: hierarchy, volatility, and fragility. Sudden and dramatic policy shifts are made possible by China’s centralised decision-making structures, in which policy is dictated from the top down (hierarchy). Policies tend to follow a cyclical pattern, with often-sharp swings between tightening and easing (volatility). And, even when well-intentioned, they often generate unintended consequences, which may take so long to materialise that, by the time the authorities grasp them, reversing course carries high costs (fragility).

China’s delayed response to the looming threat of deflation fits squarely within this pattern. Though the warning signs have been apparent for more than a year, the government was reluctant to take bold steps to jump-start growth, for a few (legitimate) reasons. Most notably, the authorities are acutely aware of the need to shift away from the economy’s traditional reliance on real-estate and infrastructure investment, toward more sustainable sources of growth, such as high-tech innovation.

It does not help that China is still grappling with the effects of the massive 2008 stimulus, especially excessive debt accumulation among local governments and state-owned enterprises—a trend that pushed the country to a critical threshold of systemic financial risk a few years ago. In addition, China’s top leadership worries that consumption-driven growth could pave the way for a welfare state, which they view as wasteful and misaligned with their long-term vision of China as a self-reliant industrial and technological powerhouse.

So, rather than heed calls for bold stimulus measures, China’s government took only modest steps to stave off economic decline. Predictably, these steps did little to address the deflation threat. Meanwhile, policymakers focused on maintaining fiscal discipline while continuing to invest in production, even though this exacerbated the overcapacity that, in sectors like solar panels and electric vehicles, is fueling trade tensions with the rest of the world.

Now, China is staring down the barrel of a Japan-style ‘lost decade’ of deflation and stagnation. And the longer deflation persists, economists warn, the costlier it will be to reverse. Fortunately, China’s leaders finally seem to be listening: in a dramatic shift, the government has fully mobilised its monetary and fiscal tools to rescue the faltering economy.

This was the right move. A supercharged stimulus effort is exactly what China needs at this point. But it is not without its risks. The stock market responded to the stimulus with a powerful rally, and equities recorded their best week since 2008. With investors expecting the government to roll out more fiscal measures to prop up the economy, speculation is running rampant.

The fear now is that this sudden injection of capital into the economy could create stock market bubbles, sowing the seeds of the next financial crisis. If this risk materialises, Chinese policymakers will once again face a crisis management situation that resembles a game of whac-a-mole: as soon as one crisis is quashed, another emerges.

To avoid this outcome, China must take steps to minimise the unintended consequences of its policy interventions, such as creating mechanisms for obtaining real-time, accurate feedback that can guide mid-course corrections before bubbles form and crises erupt. More fundamentally, China must break its habit of hasty and dramatic policy shifts based on top-down decrees and return to the approach that served it so well in the past: gradual and incremental reforms, based on decentralised policy experimentation.

Such experimentation was a hallmark of the first three decades of China’s market-reform process, when the economy achieved year after year of double-digit GDP growth. By empowering subnational authorities to leverage local knowledge and test new ideas, the central government ensured that policy innovation flourished. In recent years, however, the central government has increased its reliance on sweeping top-down decision-making, to the economy’s detriment.

Bold stimulus may buy China time, but it won’t deliver lasting prosperity. For that, China must embrace the kind of decentralised governance that powered its rise. This means restoring local governments’ autonomy and encouraging bottom-up initiatives through which authorities test solutions tailored to their regions’ circumstances. The question is whether Beijing is prepared to cede any control in its quest to secure greater long-term command over the economy.

Taiwan mobilises civil society to bolster civil defence

Taiwan has taken a big step towards bolstering civil defence, marshalling a range of resources and know-how across society.

A top-level committee, launched in June and detailed in late September, has been working to incorporate civil expertise into defence policy. In an unusual move for Taiwan, the group includes representatives from grassroots organisations that have been working since 2022 to absorb lessons from Ukraine’s experience at war with Russia.

Most of the island’s people are remarkably ill-prepared for an attack from an increasingly aggressive China. For example, few Taiwanese would know what to do if bombs began shattering nearby streets.

In detailing the purpose of the committee, President Lai Ching-te said that citizens need to know how to deter an approaching enemy. By strengthening resilience, Taiwan can prepare for both disasters and national defence.

The 23 members on the committee, the Whole-of-Society Defense Resilience Committee, include the defence minister and seven other ministers, with President Lai Ching-te as the chairperson. Also on the committee are representatives from Taiwan’s space agency, the Association of Hackers in Taiwan, Google Taiwan and Buddhist and Christian religious groups. The chairperson of PX Mart, one of Taiwan’s largest supermarket chains, is an adviser.

‘The composition of the committee was a recognition that emerging national security challenges require new approaches to risk management and that must include whole-of-government coordination—both horizontal and vertical—as well as a whole-of-society coalition,’ said committee member Enoch Wu. He heads Forward Alliance, one of the grassroots NGOs that prepares Taiwanese civilians for natural disasters and war.

Taiwan’s ability as a society to coordinate with its armed forces and government in response to a military threat is lightyears behind that of Ukraine and Israel. Globally, Israel is considered the gold standard.

Even though this is an early step for Taiwan, and progress will probably be slow, it is still a significant development. By bringing so much talent together to improve civil defence, the government should become much more able to mobilise society in time of need.

Before the committee held its first meeting behind closed doors on 26 September, President Lai in a speech promised to ‘expand the training and utilisation of civilian forces’ and ‘improve the readiness of our social welfare, medical care and evacuation facilities, and ensure the protection of information, transportation and financial networks’. The committee is also looking at ways to improve food supplies and protect energy and other critical infrastructure facilities so that they keep operating during emergencies. Taiwan’s interior minister said the government had identified 310 such facilities that needed protection or duplication.

President Lai said the committee would hold tabletop exercises in December and hold an unscripted civil defence exercise in March 2025. In June it will coordinate with the military for the annual Huang Kuang Exercise, an annual drill that is supposed to show off readiness to face an attack from China.

Presence on the committee gives a platform to two private grassroots organisations that prepare Taiwanese civilians for national emergencies. Since 2022, Wu’s Forward Alliance has been working with Spirit of America, an independent American NGO that has provided aid to Ukraine in collaboration with the US Department of Defense. Spirit of America has offered instructors and other experts to help Forward Alliance train emergency first responders in Taiwan.

Forward Alliance says 19,000 people have attended its training workshops since its founding in 2020. The workshops include basic first aid, search and rescue and team-based training in managing crowd safety and people in shelters. Forward Alliance says it’s also trained more than 1300 Taiwanese law enforcement professionals in emergency casualty care and donated first aid kits to various police precincts. Taiwan’s de facto US ambassador, Raymond Greene, attended a Forward Alliance exercise on 14 September with nearly 300 participants that simulated civilian responses to a mass-casualty explosion in a rural area.

Liu Wen, chairperson of the Kuma Civil Defense Education Association, who is also on the committee, said her organisation would like to train Taiwanese government officials and bring a ‘wartime consciousness’ to the committee. What Taiwan needs to overcome, she says, ‘is the ideological challenge that war preparedness is a form of provocation to China.’ Kuma trains Taiwanese in self-defence capabilities ranging from basic first aid skills to planning evacuation routes from homes and deciphering Chinese propaganda and disinformation.

Ingrid Larson, a top official with the American Institute in Taiwan, voiced support for the committee. Within Taiwan, however, Lai’s biggest challenge most likely will be winning support from the China-friendly opposition parties, the Kuomintang and Taiwan People’s Party. So far, they haven’t given much of a response, but they probably will be resistant and sceptical. While these parties firmly support democracy, they also support a more conciliatory approach to China and, in the past, have labelled Lai as a provocateur.

Australia needs to engage its youth population around AUKUS

Despite a push for openness and transparency in communicating the Australian National Defence posture, one group the Australian government is failing to converse with is its own citizens, especially its youth.

Communication is integral to AUKUS’s resilience and success. As Australia’s youth will be the generation who will be asked to provide for the national defence when AUKUS comes to fruition, it stands to reason that they must understand its value.

A multi-pronged and well-funded approach from the government is therefore needed for effective engagement with them. This approach must be focused on social media presence, outreach to youth organisations and schools and increasing access to AUKUS-related information.

As the agreement moves forward, all three partners must improve their messaging, particularly regarding Pillar II—advanced capabilities. Disjointed messaging between them that fails to account for each country’s socio-political environment risks losing public support and poses a threat to AUKUS’s survival.

Explanations of AUKUS can’t rely wholly on defence aspects but must include non-traditional security facets as well. A key topic Australian youth are most concerned about is the environment. So, in regard to nuclear submarines, Australian government officials must be prepared to discuss plans for disposal of nuclear waste and fears of a naval Chernobyl. Additional discussions must be had about what the youth role in the economy will be under AUKUS and the impacts of Pillars I and II for Australia’s economy and market. Telling them how the agreement benefits their daily lives now and into the future will go a long way to maintaining support.

The Office for Youth recently launched the Engage! Strategy, designed to improve young people’s involvement in government. The government can tailor elements of this strategy to specific needs of AUKUS messaging. Specifically, younger populations are increasingly getting news from non-traditional media sources. They are less likely to look for an official government statement, so the government must meet them in spaces they frequent. In fact, 68.8 percent of young Australians want the government to engage them on social media platforms.

To meet this demand for engagement, the government must be creative in its social media presence.

One example of innovative presence is NATO’s #ProtectTheFuture campaign, in which NATO experts played popular video games on Twitch with streamers from alliance countries. In partnering with Twitch streamer and Youtuber ZeRoyalViking to discuss NATO, cybersecurity and how video games can teach digital safety practices, they reached more than 40,000 people.

Australian government officials should do similar collaborations surrounding AUKUS with YouTube and Twitch streamers from Australia. These could be focused on explaining AUKUS or take a thematic slant aligned with the two pillars.

Keeping a finger on current trends and viral content also plays a critical role in the social media space. Part of the reason for the success of the NATO campaign was that the platform, games and streamers connected with what viewers were interested in at the time.

A comparable phenomenon can be seen with Kamala Harris’s presidential campaign and social media account @KamalaHQ. What has brought Harris’s presidential campaign to the forefront of American youth was singer and songwriter Charli XCX tweeting that ‘kamala IS brat’. This tweet—based off the pop culture trend of Brat Summer—spread to Harris’s marketing campaign, in turn reinvigorating youth voters.

Social media engagement isn’t a panacea, however. Youth organisations, especially at schools across the country, are also key.

Whether it’s by sending AUKUS experts to speak at organisation meetings or hosting online webinars, there’s room for engagement through connecting with those who have intersecting interests. This could look like hosting a Q&A panel or trivia night with student political organisations. Outreach should also engage science and technology organisations and vocational institutions to discuss job opportunities that will become available due to AUKUS.

The final area the Australian government must harness for youth engagement with AUKUS is a singular, dominant digital presence. Creating a first point of contact online ensures that information on AUKUS is accessible for Australian youth who wish to learn more.

A common way to link information is through services such as Linktree or with a website. Currently, the AUKUS partnership has neither. By linking sources from all three governments to associated social media accounts, the public will see trusted, verified sources to turn to alongside traditional media avenues. Starting this process now would generate a solid foundation for issues or addressing misinformation that may come up in the future.

Youth engagement with AUKUS is vital to its long-term success. Through ongoing messaging campaigns, Australia must continue to convince its citizens on why AUKUS matters, how it affects them and what it changes about the Australian way of life—because the fact of the matter is that, without Australia’s younger populace on board, literally and figuratively, the future of AUKUS is uncertain.

Austria’s far right did not win

Commentators have been unanimous in describing Sunday’s legislative election in Austria as a victory for the far-right Freedom Party (FPO), and pressure is now mounting on the progressive president, Alexander van der Bellen, to give the populists a chance to form a government. But this narrative misconstrues the electoral outcome and risks handing anti-democratic forces an unearned windfall.

To be sure, the FPO had a strong showing, winning more than 1.3 million votes (29.2 percent). But this is not unprecedented. In four of the last five elections, far-right parties attracted more than a million supporters, reflecting the fact that a significant minority of mostly rural Austrians (representing roughly one quarter of the electorate) has consistently supported uber-conservative political projects. Austria’s constitutional system, with its considerable regional decentralisation, has always been able to manage this unfortunate reality.

The narrative of a far-right victory seems to rest on the fact that the FPO won a plurality of votes among the five factions that gained seats in the parliament. In Vienna, the capital and the most populous of Austria’s nine states, the Social Democrats won decisively, increasing their share of the vote. And, nationally, the Christian Democratic Austrian People’s Party finished second, with 26.5 percent of the popular vote. Nonetheless, supporters of the far right in Austria have seized on global headlines to claim that any outcome other than a cabinet headed by the FPO’s pro-Russian leader, Herbert Kickl, would amount to a betrayal of democratic values.

This is not the first time we have heard such arguments following a plurality victory within a proportional multiparty system. Last year, Poland’s right-wing president spent weeks delaying the transfer of power from the populist Law and Justice (PiS) party to the democratic opposition based on an analogous rationale. And soon thereafter, commentators raised alarms about the supposed populist mandate in the Netherlands, where Geert Wilders’s far-right Party for Freedom became the largest of the 15 parliamentary factions, winning 23.5 percent of the popular vote.

In none of these countries do constitutional provisions require entrusting a plurality winner with the task of forming the government. Such a rule would be absurd. Far from magically conferring a popular mandate, winning a plurality is mainly a function of how fragmented a country’s political party system is.

In this Austrian election, for example, 9.1 percent of the vote went to the New Austria and Liberal Forum (NEOS), which gained two additional seats. Formed in 2012, NEOS wants to revitalise the economy and strengthen support for Ukraine in the face of Russian aggression. Had it not been around, the People’s Party probably would have overtaken the FPO in the elusive quest for a plurality.

Given this, should we then conclude that the preference of more than 400,000 Austrians for a more energetic liberal formation somehow hands the mandate to govern to the far right? What about the nearly one million Austrians who voted for the Social Democrats? Under the plurality mandate theory, they also supported the far-right mandate by not holding their noses and strategically voting for the centre right.

In the face of a consistent populist threat, democratic forces should not just roll over. They should innovate. Sometimes, the result will not be a unified republican front, but rather a loose assemblage of democratic factions that appeal to various segments of the electorate.

This is what happened last year in Poland. The authoritarian PiS was defeated by leftist, liberal, and Christian Democratic blocs that coordinated mutually friendly campaigns and, after belatedly receiving the presidential commission, smoothly formed a cabinet. The baseless fixation on a plurality mandate discourages such successful democratic experiments by ignoring the legitimacy of other parties’ shares of support.

The typical response to such arguments is rooted in tradition. In Austria, the party with the strongest showing has almost always been offered an opportunity to form the government and hold the federal chancellorship. But the populists are themselves providing reasons to be treated differently. From Poland and the Netherlands to Austria, populists consistently frame elections as a stark choice between an indistinguishable assortment of corrupt mainstream parties and themselves. In one of the FPO’s pre-election ads, a stern-looking voter stands at a crossroads with a rightward-pointing sign featuring Kickl and a leftward-pointing sign lumping together photos of the four mainstream party leaders.

Van der Bellen should take the populist message seriously and decline to offer Kickl a chance to form the government. If the FPO truly represents a vision of Austria distinct from that of all other parties, then voters have made their wishes clear. The FPO’s vision was overwhelmingly rejected. Despite significant economic and social challenges, 70 percent of Austrians chose to entrust their country’s governance to mainstream democratic parties. Their voices should be heard.

Triton: transforming Australia’s airborne ISR capabilities

The Australian Defence Force is on the brink of a transformative shift in its airborne intelligence, surveillance and reconnaissance (ISR) capabilities with the imminent introduction into service of the MQ-4C Triton, an unarmed, high-altitude and long-endurance uncrewed aerial system (UAS).

Use of the Triton will bring far more capability than is generally appreciated, even by close observers of defence policy.

The advanced aircraft, developed by US Navy and Northrop Grumman and based on the company’s RQ-4 Global Hawk, is a testament to the power of modern technology and its potential to revolutionise maritime surveillance operations. It goes a long way, sees far and stays on station a long time; it also networks to tell the rest of the force what it finds.

The Triton’s journey to Australia began in 1999, under Joint Project 2062, with the ADF experimenting with the earliest versions of the Global Hawk. The Triton’s capabilities include an ability to reach altitudes of 15 kilometres (50,000ft), stay aloft for 24 hours, provide real-time data and intelligence and sweep the ocean surface within 250 nautical miles (about 450km) of the aircraft. As a result, one Triton on one flight can surveil more than one million square nautical miles (3.4 million square kilometres)—an area larger than Western Australia.

One task, for example, could be prolonged monitoring of an archipelagic choke point to impose deterrence-by-detection mission.

These characteristics set it apart from any other aircraft on the market and meet the requirements set forth in the Defence Strategic Review for a high level of situational awareness in the Indo-Pacific. The value of the Triton’s capabilities are obvious when one considers the size of Australia’s vast maritime domain, which spans three oceans.

The Australian government has said it will buy four Tritons. In Australia’s primary area of military interest, the US Navy will fly its Tritons from Guam and California, while the US Air Force, Republic of Korea Air Force and Japanese Air Self-Defense Force operate the RQ-4 Global Hawk.

The Triton’s ability to respond quickly to events and maintain itself on station for long periods makes it superior to the new wave of systems that are small, smart and many. But such systems can complement Tritons, improving the capabilities of both simultaneously.

The Triton also enables new approaches to teaming with other systems. The aircraft allows for space-based ISR, including small satellites, to join and then leave the team as they pass through the area of interest on their low-earth orbits.

In peacetime, the Triton’s capabilities can be leveraged for humanitarian assistance and disaster relief. For instance, in the event of a tsunami like the 2004 Boxing Day disaster, a Triton could map the coastal destruction zones of large areas of affected countries in a single sortie, providing vital data for emergency response efforts.

The Triton’s remote operation means aircrew won’t need to deploy with their aircraft, providing home location stability for those choosing a career in Triton operations. Moreover, the highly automated operator interface opens the door to Reserve aircrew, mobility-restricted personnel and even pregnant aircrew, who can operate the system right up to their maternity leave.

Beyond its immediate role, the Triton also serves as a catalyst for the ADF’s broader capabilities in ISR and electromagnetic warfare (ISREW). It is the first platform to send high-bandwidth data across all security domains, up through the satellites and down directly to land and maritime component commanders. Bringing that capability and others, the program is one of a suite of projects creating a framework for follow-on systems. An overlap with other intelligence, communications and networking projects is setting the stage for a more capable, integrated and interoperable ADF.

Tritons will complement the ADF’s crewed P-8A Poseidon’s as a family of systems, undertaking enhanced ISREW tasks. This approach leverages the strengths of both crewed and uncrewed systems, providing a more robust and versatile ISREW capability.

The Triton’s introduction also paves the way for the integration of more advanced uncrewed aircraft by setting a certification precedent. This forward-thinking approach positions the ADF as a leader in military technology, ensuring it can remain at the forefront of military innovation.

The Triton provides benefits to the Australian economy and create jobs at RAAF Bases Tindal and Edinburgh in support of Defence’s industry goals. The cooperative program with the US Navy and the collaboration with Northrop Grumman strengthens Australia’s strategic alliances, enhancing its position on the global stage.

Earthquakes in the Middle East

The Middle East resembles nothing so much as an earthquake zone with multiple fault lines. This week, fighting increased sharply along one of those lines, Israel’s border with Lebanon and more specifically, between Israel and Hezbollah. This in turn triggered activity along another fault line, as Iran, Hezbollah’s backer, retaliated by firing ballistic missiles at Israel, which has vowed to respond severely. Less clear is what will come next, either along these particular fault lines or elsewhere in the region.

What made escalation all but inevitable were rocket strikes by Hezbollah against Israel in the aftermath of Hamas’s 7 October 2023 attack. Israel evacuated some 60,000 citizens from the northern border to shield them from the risk of attacks similar to Hamas’s, but the mounting exchanges of fire between Hezbollah and Israel made it impossible for them to return safely.

What enabled the emergence of this new front, however, is that the situation in Gaza had reached something of a new equilibrium. Over the past year, Israel has sharply degraded the military threat posed by Hamas. Between 10,000 and 20,000 of its fighters have been killed, with many of its leaders either assassinated or forced into indefinite hiding in Gaza’s labyrinth of tunnels. Israel determined that it could safely shift its focus to its northern border and Hezbollah.

What Israel has accomplished thus far against Hezbollah is impressive. First by detonating explosives implanted in pagers and walkie-talkies, then by targeted aerial bombardment, Israel decimated Hezbollah’s senior leadership, including Hassan Nasrallah, the group’s leader for over three decades, and killed a significant number of Hezbollah fighters.

After Israel’s costly intelligence failures in the lead-up to 7 October, the attacks against Hezbollah have revived the Israeli security establishment’s prestige by demonstrating its continued ability to gain precise intelligence about enemy groups and exploit that intelligence in a decisive fashion. The belief that Israel and Hezbollah had reached a stalemate, with Israel sufficiently deterred from forceful action by Hezbollah’s ability to unleash a missile barrage against it, has been debunked.

Israel followed its covert operations and air attacks with a ground incursion into Lebanon of unknown extent and duration. Also unclear is the purpose. Eliminating Hezbollah is impossible, and occupation of large swaths of Lebanon would be ill-advised given Israel’s poor history with such undertakings.

Current Israeli policy seems designed more to discourage Hezbollah from further attacks, but this, too, may not be possible. Although Israel has seriously weakened the organisation, it still maintains a sizeable fighting force, making it a dangerous foe, especially in any war fought mostly on its home turf. At the same time, as Hezbollah installs new leaders, it must decide whether and how to respond to Israel. The more it retaliates, the more it will invite strong Israeli military action. In short, it is far from clear where all this is leading.

One can sympathise with what Israel has done in Lebanon while criticising what it has done, and failed to do, in Gaza. Hamas, like Hezbollah, is an Iran-backed terrorist organisation that seeks Israel’s destruction. But that is where the similarities end. Hamas is a national liberation movement that has support from elements of the native Palestinian population. Hezbollah, by contrast, is purely an instrument of Iranian foreign policy, with little attachment to the aspirations of the Lebanese or Palestinian peoples.

Moreover, no country would countenance living with a threat that required tens of thousands of its citizens to vacate their homes. And the Lebanese government forfeits some of the normal advantages of sovereignty by failing to fulfill the obligation of ensuring that its territory is not used by terrorists to attack another country.

For its part, Iran has reacted to these attacks on what was perceived to be its strongest proxy by taking what could be the fateful step of attacking Israel directly. I am frankly surprised that Iran did this, although its leaders may have felt compelled to do so lest they appeared weak. Or they may have thought they could thread the needle by acting against Israel without provoking a meaningful military response. But Iran has now provided Israel with a justification to retaliate, for example by attacking nuclear sites and military targets, or even energy-related facilities central to its economy. Israel proved it could do so in April, in the aftermath of an unsuccessful Iranian drone and missile attack.

Striking Iran directly is something many Israelis would welcome, as they have grown weary of dealing with its many proxies. After years of indirect conflict, there is significant domestic support for ‘going to the source’, with the hope that doing so would persuade Iran to curtail its support for its proxies. Some even appear to believe such attacks could trigger events that would bring about the downfall of the Iranian regime. Earlier this week, Israeli Prime Minister Benjamin Netanyahu said, ‘When Iran is finally free—and that moment will come a lot sooner than people think—everything will be different’.

Regime change cannot be ruled out, though it is far from likely, much less assured. It is also far from clear what sort of government might replace the current one. The current regime is more likely than not to weather whatever comes its way, find ways to attack Israeli and Western targets around the world and, most consequentially, accelerate its efforts to develop nuclear weapons.

We may well be nearing a turning point in the Middle East. What we don’t know is where that turn could take us.

Securing Australia’s supply chains through targeted investments in manufacturing

Australia needs a policy for delivering the minimum manufacturing capacity that would ensure national resilience, security and economic prosperity.

Unfortunately, Australia’s domestic manufacturing capacity is generally declining, except in the defence industry and, in time, maybe renewable energy transition. At the heart of our manufacturing woes are increasing competition from low-cost overseas producers, unfair trade practices, disrupted supply chains and a lack of sustained investment in advanced technologies.

The Australian government must now be clear-minded that a robust manufacturing sector is not just about job creation and economic prosperity; it is an insurance policy to protect the nation. Australia’s vulnerability during the pandemic, when global supply chains faltered and essential goods became scarce, should have served as a wake-up call.

Since then, geopolitical tensions, natural disasters and global market fluctuations have continued to expose our supply chain vulnerabilities and heavy reliance on international suppliers for essential goods and raw materials. Australia’s current shortages of IV bags and palliative care drugs highlight the country’s reliance on fragile global supply chains.

The Albanese government’s made-in-Australia policies and initiatives to boost local solar panel and battery production aim to promote domestic manufacturing in renewable energy. Focusing narrowly on that sector leaves many other manufacturers without the support needed to be competitive, let alone grow. Without addressing skills development, innovation, and supply chain resilience, these initiatives are unlikely to foster a diverse and sustainable national manufacturing capacity.

One of the most urgent priorities is to support Australian businesses in transitioning to modern manufacturing techniques through targeted subsidies, tax incentives and infrastructure improvements. A good starting point would be to bolster domestic production of medical supplies and agricultural inputs using technologies of the fourth industrial revolution. Such investments would reduce reliance on imports, mitigate risks posed by global trade disruptions and strengthen national security. Moreover, they could ensure that geopolitical tensions or economic shocks would not disrupt much of the economy.

Supporting the development of the nation’s skilled workforce is also crucial for the future of advanced manufacturing. Modern manufacturing requires specialised technical knowledge, particularly in high-tech industries, in which automation and digitalisation are rapidly changing production processes.

The government must continue to invest in education and training programs, especially in science, technology, engineering and mathematics, to drive innovation and equip workers with the necessary skills to meet the demands of advanced manufacturing. Such investments have underpinned the national resilience and economic prosperity of Taiwan and Singapore.

Innovation and technological advancement in manufacturing must be further incentivised. As global competition keeps intensifying, Australia needs to catch up in developing and adopting cutting-edge technologies. The future of manufacturing lies in the advanced production techniques of automation, artificial intelligence and 3D printing, plus many technologies still unimagined.

Modern manufacturing addresses the challenge of scale, which has bedevilled Australian business. It enables companies to optimise production processes, reduce lead times and costs and efficiently adapt to on-demand supply needs while maintaining high quality and precision. To maintain a competitive edge in these emerging fields, Australia must lead in adopting and developing these technologies.

The government has made significant strides in supporting innovation through research and development grants, tax credits and partnerships between universities, research institutions and industry. To further enhance this ecosystem, we must find innovative ways to increase funding for research and development initiatives aimed explicitly at advanced manufacturing. This should be done though expansion of tax incentives for companies investing in such technologies. Additionally, establishing regional innovation hubs focused on specific industries, such as biotech, would better support local startups and facilitate collaboration.

This is about more than what the government should do. An ability to quickly adapt to technological advancements would enhance the sector’s efficiency and output and allow Australian companies to seize new opportunities as they arose in an increasingly competitive global market. This forward-looking approach would ensure that Australia remained at the cutting edge of global manufacturing.

With targeted investments in manufacturing capabilities and innovation, Australia’s supply chains would be better protected.

Australia must define and maintain a minimum manufacturing capacity to enhance its national resilience in an age of continuous, concurrent and cascading crises. Hard choices will of course need to be made, but clearly food and health security ought to be key priorities. Through these efforts, the nation can ensure that it remains competitive, resilient and prepared for the complexities of the global economy.

Ishiba’s Asian NATO: a pot of gold at the end of the rainbow

Newly installed Japanese Prime Minister Ishiba Shigeru’s idea for an Asian NATO is probably not achievable in the short term. It’s a good idea for the more distant future, but for the moment there’s nowhere near enough support and preparedness in Japan and elsewhere in the region for it to go ahead.

The idea is not new. Michael Green pointed out the emerging plausibility of such a bloc last year, noting the urgency of collectively countering China’s assertiveness in the Indo-Pacific. Shinzo Abe promoted less formal cooperation between such democracies as Australia, India, Japan and the US to dissuade China from aggression. Since China has become more aggressive, not less, formalising the integration of the hub-and-spokes alliances centred on the US should be part of strategic discussions in the coming years.

Even a mere proposal for Asian NATO would be helpful. It warns China that its aggression could result in the formation of a multilateral alliance to oppose it.

Ishiba has promoted the idea for more than 10 years. In the context of enabling collective self-defence in Japan in 2014, he stressed the importance of extending collective self-defence with countries that shared democracy and freedom, especially with other US allies, including Australia. And an Asian NATO may be an unspoken goal of the US policy to build collective military capability through a latticework of western Pacific alliances.

Nonetheless, Ishiba’s proposal does not look like an immediate remedy for the deteriorating Indo-Pacific security environment.

First, Ishiba himself noted in 2014 that Asia had greater disparities of military and economic resources and more ethnic and religious diversity than Europe, so the Asian NATO ambition would take time and energy.

His intention appears to have turned from general collective defence to specifically deterring China from attacking Taiwan. Just before the LDP leadership race in 2024, he raised the idea of a coalition of democracies with Taiwanese President Lai Ching-te in Taipei, implying that Taiwan would be in an Asian NATO and, given China’s ambitions, become its main concern.

But, across the region, there is no consensus support for using force to protect Taiwan. A Lowy Poll in 2023 revealed that only 42 percent of Australian respondents supported the Australian Government sending troops to Taiwan to defend it. In another survey, such support in South Korea was 34 percent.

Crucially, only 11 percent of Japanese survey respondents said they would want their country to force alongside the US to protect Taiwan; 56 percent backed logistical support to US forces, and 27 percent opposed working with US forces at all in such a contingency. In Southeast Asia, the ISEAS survey found that 15 percent of Filipinos supported military help for Taiwan, and even that was higher than the average of 5.7 percent across the Association of South East Asian Nations.

Second, Japan already extended the right of collective self-defence to the United States and potentially US allies, without an Asian NATO. In the 2014 interpretation of its constitution, it can exercise the right of collective self-defence only ‘when attacks against a foreign country that is in a close relationship with Japan threaten Japan’s survival and pose a clear danger to its people’.

While Japan’s response to the Taiwan contingency remains ambiguous, the US-Japan alliance would end if Japan failed to extend the collective self-defence to the US forces fighting for the island.

An obstacle to creating an Asian NATO would be the continuing political unacceptability in Japan of an obligation to use military force, like that created by Article 5 of the NATO treaty. If Japan wants to establish an Asian NATO, it should take the first steps of amending its constitution and taking more responsibility for its own defence.

Ishiba does want delete Paragraph 2 of Article 9 of the constitution, which prohibits possession of offensive military potential, and reform Japan’s military as more than a self-defence force. Still, achieving that would be as hard for him as walking on the Moon, and then creating an Asian NATO would be as hard as walking on Mars.

Also, Ishiba may have quite enough to do in trying to revise Japan’s status-of-forces agreement (SOFA) with the US. He dislikes Japan’s asymmetrical obligation to allow foreign (US) forces on its territory.

All in all, the benefit of promoting an Asian NATO is highly limited.

Moreover, in mobilising political, diplomatic and military resources to pursue the ambition, Ishiba could switch attention away from, and thereby weaken, less ambitious but useful attempts at deterring China. Examples are improving interoperability and responsiveness, and achieving smoother coordination in command and control. The US and its allies should focus on concrete and practical next steps of patchworking bilateralism and minilateralism to address the China challenge, rather than dreaming of a pot of gold at the end of the rainbow.

Afghan women’s vulnerability must be a priority issue for Home Affairs

An unacceptable pattern is emerging in the way the Department of Home Affairs deals with visa applications for vulnerable Afghan women.

The Taliban celebrated the three-year anniversary of its takeover of Afghanistan in August with a military parade and a new set of vice and virtue laws making it illegal for women to speak outside the family home. The extremist group has been progressively cracking down on defenders of women’s human rights.

But Home Affairs has been requesting Afghan families remove their vulnerable female relatives from humanitarian visa applications. It also recently denied the application of a women’s human rights defender whose application was proposed by an Australian citizen more than two years ago.

When the Australian Federal Police was moved out of the Home Affairs portfolio, the department seems to have considered its responsibilities under Australia’s National Action Plan on Women, Peace and Security were transferred as well. They were not. The National Action Plan (NAP) prioritises the rights of women and girls in situations of armed conflict, including through humanitarian protection.

On their Afghanistan Update webpage, Home Affairs says that ‘members of identified minority groups (such as women and girls, ethnic minorities and LGBTQI+) who are referred by the UNHCR or proposed by a close family member in Australia’ will be given priority processing.

A locally engaged employee (LEE) of the Australia government, who spent 14 years working on the multinational base in Tarin Kowt and at the Australian Embassy in Kabul, shared correspondence with me showing Home Affairs asking his family to remove his mother from their humanitarian visa application in July.

The 68-year-old woman has depended financially and psychologically on her son for years. Rental agreements from Afghanistan and Pakistan—where she is living in limbo, having fled her home in Afghanistan—have been provided to the department, as have receipts for medical care.

The woman also depends on her son for her physical security. Her only son still residing in Afghanistan was imprisoned by the Taliban because of his brother’s links to Australia. If she were forced to return to Afghanistan, she would have no mahram (male relative or guardian) to accompany her and no one able to rent a house and pay her expenses.

Still, according to communication between Home Affairs and the LEE’s local member of parliament, the department determined that his mother did not meet the dependency criteria for the visa application. These criteria have not changed in the past three years.

Similarly, the department asked a Hazara family to remove their 23-year-old unmarried daughter from their family reunion application that was proposed by a family member residing in regional Australia.

Under the current gender apartheid regime of the Taliban, an unmarried 23-year-old faces many specific challenges in addition to the threats posed against her family. She also faces different threats than those faced by older women. Without the presence, protection and support of her family, this woman faces the increasing and serious threat of forced marriage and sexual abuse if imprisoned for breaking the laws restricting the movement and rights of women. She will not be allowed to work, rent a house or even use her voice in any public space.

Australia’s National Action Plan on Women, Peace and Security is designed to ensure that all relevant government departments implement the suite of UN Security Council resolutions on Women, Peace and Security, as well as General Recommendation 30 of the Committee on the Elimination of All forms of Discrimination Against Women (CEDAW) and other international legal obligations relating to conflict and insecurity.

In General Recommendation 30, CEDAW reinforced and complemented the international legal protection regime for refugees, articulating the obligation to ensure responses to conflict and instability are gender sensitive. UN Security Council resolution 2122 recognises the need to better respond to analysis of the ‘impact of armed conflict on women and girls’. But it is CEDAW that specifically call for states parties, including Australia, to provide durable solutions for women and girls who are displaced.

General Recommendation 30 has an entire section dedicated to the unique vulnerabilities women and girls face when they are forcibly displaced, obliging states parties to ‘address the specific risks and particular needs of different groups of internally displaced and refugee women, subjected to multiple and intersecting forms of discrimination, including women with disabilities, older women, girls, widows, women who head households … women belonging to ethnic, national, sexual or religious minorities, and women human rights defenders.’

Despite Australia’s current representation at CEDAW, Home Affairs last month denied a humanitarian visa application to a woman who was the co-founder and program director of an Afghan woman’s rights organisation. She and her organisation received threats from the Taliban because of the work they did advancing women’s rights, and women in similar circumstances have been disappeared.

The woman ran a range of women’s rights programs including a tertiary education scholarship for young Afghan women that was supported by the Ford and Carnegie Foundations. She has been in exile in Pakistan for three years facing increasingly dire living circumstances and is no longer able to renew her Pakistani visa.

Yet, Home Affairs denied her on the basis that she was not facing sufficient persecution in her country of origin, or she had somewhere else to go, among other things. This is simply not true.

Home Affairs has faced multiple crises since the Taliban retook control of Afghanistan, and it is important it provides visas to address humanitarian issues in the Middle East, too. However, there is no excuse for such flagrant denial of Australia’s obligations to protect vulnerable Afghan women and girls through our humanitarian migration program.

The women of Afghanistan are now profoundly vulnerable—financially, psychologically and physically. This issue must be at the forefront as the department processes visa applications.

The headline of this article has been amended since publication.

The United Nations and a world out of balance

See the sad, stressed state of the world when Australia’s prime minister goes to a Quad summit in the US but doesn’t bother going to the United Nations.

Anthony Albanese went to the Quad last month seeking balance of power, while the UN confronted a world out of balance.

The UN leaders’ week got off to an ambitious start with the Summit of the Future on 22 and 23 September, which produced the Pact for the Future, Global Digital Compact and the Declaration on Future Generations. In the effort to reboot multilateralism, the UN gets an A for ambition. Unfortunately, that doesn’t necessarily translate to A for able, achievable or attainable.

The procedural blocks Russia kept throwing at the pact supported such scepticism. The absence that mattered at the UN gathering wasn’t that of Albanese, but of Xi Jinping and Vladimir Putin.

The leaders of China and Russia don’t have to attend because they have the power that trumps all else in the UN: they wield the veto held by the five permanent members of the Security Council. The veto can block any attempt to restructure the Security Council, despite calls for change.

The US supports new permanent seats on the Security Council for Germany, India and Japan, plus two African nations. The new members would not get the veto power. In his UN speech, France’s President Emmanuel Macron proposed major limitations on the veto:

Reform of the composition alone of the Security Council is not sufficient to make it more effective. I also wish for reform to change the operational methods to limit the right to a veto in case of mass crimes.

Translation: Russia should not be able to veto resolutions condemning its mass crimes in Ukraine. The day the veto power is reformed, however, we really will have a world body showing an ability to change the world.

The need for change was captured in a New York Times headline previewing the leaders’ week: ‘United Nations meets as growing chaos and violence spread across the world’. The UN’s own people pay part of the price of a world locked in a ‘purgatory of polarity’—220 of its staff have been killed in the Israel-Hamas War.

The ‘purgatory’ line is from UN Secretary-General Antonio Guterres in his annual statement to the General Assembly, decrying the ‘whirlwind’ of out-of-control geopolitical divisions in an ‘era of epic transformation’.

Guterres pointed to three major drivers of the unsustainable whirlwind:

—A world of impunity, where violations and abuses threaten the very foundation of international law and the UN Charter.

—A world of inequality, where injustices and grievances threaten to undermine countries or even push them over the edge.

—A world of uncertainty, where unmanaged global risks threaten our future in unknowable ways.

Following the secretary-general to the podium, Joe Biden delivered one of the last foreign policy speeches of his presidency by surveying the 52 years since he became a senator. His poetic version of what he sees today drew on lines from Yeats: ‘Things fall apart; the centre cannot hold; Mere anarchy is loosed upon the world’.

Seeing an inflection point in world history, Biden called on the UN to hold the centre:

There will always be forces that pull our countries apart and the world apart: aggression, extremism, chaos, and cynicism, a desire to retreat from the world and go it alone. Our task, our test is to make sure that the forces holding us together are stronger than those that are pulling us apart, that the principles of partnership that we came here each year to uphold can withstand the challenges, that the centre holds once again.

Biden’s quote was highlighted in a commentary by Richard Haass, the veteran diplomat and analyst who is one of my go-to guides for following US international policy.

Haass described the speech as being ‘reminiscent of the book that influenced me most on international relations, The Anarchical Society, by the Australian academic Hedley Bull. For Hedley, the state of the world reflects the relative balance between forces of order and disorder, or in his terminology, “society” and “anarchy”.’

Haass wrote that order is not the natural way of the world—entropy and disorder is what happens in systems unless they are influenced by benign actors:

Several trends have moved things towards disorder of late. There is the proliferation of power (above all military, but also economic) that ensures the United States and its partners will encounter increasingly strong opposition from China, Russia, and others when they seek to expand their influence and promote their interests. There is as well the emergence of global issues—above all climate change—for which it has become impossible to forge a common approach.  And there is another factor adding to disorder: the eroding commitment within the United States to play the sort of leading international role that has characterized our foreign policy approach for the past 75 years.

This sentiment was echoed in most leaders’ speeches throughout the week of high diplomacy. Beyond the words, the hard question facing the UN is what weight it can muster to deal with a world out of balance.