Australia’s semiconductor manufacturing moonshot: Securing semiconductor talent

Semiconductors are a critical component in all modern technologies, from personal communication devices and medical devices to weapons systems. Crucial to producing semiconductors is the availability of a highly skilled workforce, managing clean-room facilities and highly specialised equipment to execute the hundreds of unique steps needed to manufacture a single wafer, depending on the complexity of the chip.

ASPI’s 2022 report, Australia’s semiconductor national moonshot, laid out the strategic reasons why Australia must embark on a capacity-building initiative to create a homegrown semiconductor manufacturing ecosystem. Every item on the Australian federal government’s List of Critical Technologies in the National Interest is dependent on semiconductors.

By committing to growing a semiconductor-manufacturing industry from a mature-process-scale baseline, policymakers would position Australia to manufacture chips relevant to the energy, transport, health, IT and defence sectors. Such an industry would enable Australia to execute long-term critical technology strategies in areas such as quantum computing and artificial intelligence, to mitigate supply-chain risk against disruption from conflict or natural disaster, and provide highly skilled jobs in affordable locations, enriching the Australian economy.

It’s important to note that both AUKUS Pillar 2 and the Albanese government’s April 2023 publication of the Defence Strategic Review reflect a shift in Australia’s strategic thinking on defence and national security, and the important correlation and greater cooperation between industry, education and defence priorities, particularly when it comes to technology. Delivering on that shift will be difficult and often costly, but this report provides a series of recommendations of what that correlation and cooperation could look like.

For Canberra, such an endeavour is of the same magnitude as America’s historic ‘moonshots’ during the 1960s and 1970s. It’s a once-in-a-generation challenge that will determine Australia’s place in the world, and human capital is central to ensuring success. Opting out of semiconductor manufacturing for the long term would severely constrain Australia’s growth as a technological nation and consign it to second-tier status.

This report expands on the recommendations made in the 2022 ASPI report for establishing a semiconductor-manufacturing capability in Australia and focuses on the importance of creating a talent pipeline that can support a scaled industry. Achieving a semiconductor moonshot requires stepping up Australia’s very respectable semiconductor device fabrication R&D to industry-compatible prototyping via a dedicated facility, together with attracting (through that capability and by government incentives) a semiconductor manufacturer to locate a mature-process-scale foundry in Australia—which will require support from an upskilled Australian talent pipeline. This is an ambitious move but is an essential step in growing such a capability.

The ability to grow and maintain a high-skilled workforce is a foundational challenge for Australia that can be addressed through close examination of trailblazing public–private partnerships (PPPs) that aim to provide talent-pipeline security in the US, Taiwan and Japan. Australian governments, industry and academia can emulate and engage with the examples highlighted through case studies in this report to attract semiconductor industry investment, boost talent-pipeline development and strengthen industry R&D. Australia’s states and territories all have varied capacity to o›er support to a semiconductor-manufacturing capability.

Bronte Munro and Greg Brown quoted in Radio Free Asia article on Prime Ministers Albanese’s State visit with President Biden, and following visit to China

Australian  Prime Minister Anthony Albanese met with US President Joe Biden in Washington on Wednesday before visiting China. The outside world is paying attention to what impact this will have on the trilateral relations between the United States, China and Australia. When Albanese met with Biden, what did the leaders of the two countries focus on?

On October 22, Australian Prime Minister Albanese arrived in Washington and held a bilateral meeting with US President Biden on the 25th. During the talks, the leaders of the two countries discussed possible cooperation on biotechnology, high-end batteries, quantum computer computing, cybersecurity, space, artificial intelligence, climate change and other issues.

On the afternoon of the 25th, Biden stated at a joint press conference that in earlier talks, the leaders of the two countries discussed how to maintain maritime security in the Indo-Pacific region through military cooperation: “The alliance between the United States and Australia is to maintain maritime security in the Indo-Pacific region. As an anchor of global peace and stability, we (the United States and Australia) work with India and Japan in the Quadrilateral Security Dialogue (Quad) to ensure freedom, openness, prosperity, and security in the Indo-Pacific region. Through trilateral security between Australia, the United Kingdom, and the United States Partnership (AUKUS), we are also investing in our shared security across generations.”

Biden said: “When we negotiated the trilateral security partnership, Xi Jinping asked me if the purpose of the United States was to contain China? I said no, we just want to ensure that the waterways are open, and you cannot arbitrarily change the regulations related to the waterways. , such as what are the international airspace and international waters, which is why we established the Quadrilateral Security Dialogue. Xi Jinping does not like this alliance, but the focus of the Quadrilateral Security Dialogue is to maintain stability in the Taiwan Strait, the Indian Ocean, and the Indo-Pacific region as a whole. “

Biden also warned against the dangerous navigation of Chinese coast guard ships in the South China Sea at the press conference: “In the past week, Chinese ships have sailed dangerously and illegally in the South China Sea with the intention of interfering with the Philippines’ routine replenishment within its exclusive economic zone. Action. I want to make it clear that the United States’ defense commitment to the Philippines is unbreakable and that any attack on Philippine aircraft, ships, or troops will trigger the U.S.-Philippines Mutual Defense Treaty.”

Scholar: U.S. and Australian leaders are committed to eliminating the threat of China in the scarce metals supply chain

Regarding the meeting between Biden and Albanese, Australian Strategic Policy Institute (ASPI) analyst Bronte Munro told our reporter that the leaders of the two countries should have focused on maintaining the supply chain of scarce metals: “Building resilient and competitive supply chains, freeing them from coercion, and proposing an alternative to China’s market monopoly is a daunting challenge that will require the cooperation and cooperation of leaders at the highest levels of government. Talks. The United States cannot do without Australia on this matter, but Australia needs more capital and foreign investment to be able to mine critical minerals.”

Greg Brown, a senior analyst at the Australian Strategic Policy Institute, also said that Biden and Albanese should have exchanged views on the specific promotion of the trilateral security partnership: “Privately, I think the two leaders shared raised concerns about the rapid deterioration of global security, but the two sides also specified what help they each needed. Australia is currently frustrated by the slow speed of technology transfer in the trilateral security partnership. Under the trilateral security partnership, the two countries are working together To build submarines, the United States and Australia both hope that each other will provide assistance in manpower and infrastructure problems encountered. At the same time, both leaders hope that the United States will include Australia in the list of suppliers of critical minerals – a move that will allow Australian companies accept U.S. funding, but the decision requires approval by the U.S. Congress.”

Albanese accepts China’s invitation to visit China: continued exchanges are in the interests of all countries

Meanwhile, on Sunday, Albanese announced that he would embark on a four-day trip to China on November 4. During this trip, he will visit Shanghai and Beijing and hold talks with Chinese President Xi Jinping. At the joint press conference on the 25th, Albanese also explained his trip to China. He said that there is still a strategic competition between China and Australia.

Albanese said: “My principle is to cooperate where you can, disagree where necessary, and interact with China in the interests of the country. I think continued dialogue is in the interest of Australia, China, and the world.” interests, so I responded to China’s invitation to visit China. … I think it is also a good thing that many high-level US officials have interacted with the Chinese government recently, because dialogue can promote understanding and reduce tensions.”

On the eve of Albanese’s visit to China, the Australian Prime Minister first visited Washington. What does the outside world pay attention to such an itinerary?

In this regard, Brown believed that Albanese visited the United States first because he wanted to reach a consensus with the United States before meeting with Xi Jinping: “Before talking to opponents, it is a wise decision to meet with major allies. Albanese’s visit to Washington is It’s a signal that despite Australia’s reliance on trade with China, the U.S.-Australia alliance still comes first.”

Munro also expressed similar views on this: “Albanese’s visit to the United States publicly demonstrated the importance and commitment of bilateral relations between the United States and Australia. It also demonstrated to Beijing the strategic unity of the United States and Australia in facing China. .The purpose of the Australia-UK-US trilateral security partnership is to deter China’s coercion and aggression in the Indo-Pacific region, which will establish a key framework for Australia’s interactions with Xi Jinping.”

Scholar: China tries to win over Australia to remain neutral in US-China competition

In addition, last Saturday, the Chinese government just announced that it agreed to review the import tariffs imposed on Australian wine. This tariff was implemented in 2020 and severely hit the sales of Australian wine because the then Australian Prime Minister Scott Morrison called for an investigation into the origins of the new coronavirus, sparking dissatisfaction with the Beijing authorities and economic retaliation.

It is generally believed that Albanese will visit China in the near future, which shows that China-Australia relations have stopped falling and rebounded in the near future. In addition to the opportunity for the Chinese authorities to cancel wine tariffs, the Chinese government also recently released a man who had been imprisoned for more than three years. Australian journalist Cheng Lei.

In an interview with this station, Yu Maochun, director of the China Center of the Hudson Institute, a think tank in Washington, D.C., believed that China has recently released many goodwill signals to Australia in order to win over Australia to maintain a neutral position in the competition between the United States and China: ” Because Australia is a very important member of the Five Eyes alliance and is very wary of China in terms of international defense, and military exchanges between the United States and Australia are increasing day by day, it wants to provoke a substantive alliance relationship with the United States.”

Yu Maochun analyzed that when Albanese and Xi Jinping meet, the leaders of the two countries should focus on economic topics: “It (the Albanese government) has closer exchanges with countries such as the United States, NATO, and Japan on defense and security affairs. And the AUKUS (Australia-UK-US Trilateral Security Partnership) plan is also proceeding as scheduled. However, Australia also realizes that its dependence on the Chinese market is still relatively critical. The Australian Prime Minister’s visit to China and Xi Jinping may want to talk about stabilizing bilateral relations, especially The goal is to stabilize bilateral economic relations, and the normal trade between Australia and China cannot be affected just because the Australian government has taken some defense actions and deepened relations with the United States.”

Munro also analyzed: “Trade will be the top issue on Albanese’s agenda, and resolving China’s export controls on Australian commodities such as wine, lobster and beef, and restoring barley trade will be his focus.”

Prime Minister Albanese State Visit with President Biden

On 24 October, the ASPI DC team attended the official opening of the Australian Embassy by Prime Minister Anthony Albanese and Ambassador Kevin Rudd.

On 25 October, the ASPI DC team attended the arrival ceremony for Anthony Albanese at the White House.

On 26 October, ASPI Executive Director, Justin Bassi, attended a State Luncheon in honor of Prime Minister Anthony Albanese, hosted by Vice President Kamala Harris and Secretary of State, Antony Blinken.

Building whole-of-nation statecraft: How Australia can better leverage subnational diplomacy in the US alliance

Australia and the US are both federations of states in which power is shared constitutionally between the national and subnational levels of government. However, traditionally, one domain that hasn’t been considered a shared power, but rather the constitutionally enshrined responsibility of the national governments, has been international affairs (in the US Constitution through Article I, Section 10 and other clauses and in the Australian Constitution through section 51 (xxix), known as the external affairs power). For this reason, foreign-policy and national-security decision-makers in Washington DC and Canberra have rightly seen themselves as the prime actors in the policymaking that develops and strengthens the US–Australia alliance and all global relationships, with limited power held by subnational governments.

However, in our globalised and digital world, constitutional power no longer means that subnational governments have only narrow roles and influence on the international stage. While national governments will continue having primary responsibility for setting foreign policy, subnational governments have offices overseas, sign agreements with foreign governments, and regularly send diplomatic delegations abroad. Recent events, including the Covid-19 pandemic, have highlighted subnational governments’ decisive role in shaping, supporting, adapting to and implementing national and international policy. The pandemic, including post-pandemic trade promotion, demonstrated that the relationships between layers of governments in both federations are essential to national security, resilience, economic prosperity and social cohesion.

Subnational governments have vital roles to play in helping to maximise national capability, increase trust in democratic institutions, mitigate security threats and build broader and deeper relationships abroad. At the subnational level in Washington and Canberra, people-to-people, cultural and economic links create the deep connective tissue that maintains relationships, including those vital to the US-Australia alliance, no matter the politics of the day. But that subnational interaction must be consistent with national defence and foreign policy.

Australia’s federal system should help facilitate international engagement and incentivise positive engagement while ensuring that the necessary legislative and policy levers exist to require the subnational layer to conduct essential due diligence that prioritises the national interest. In this report, the authors make a series of policy recommendations that will support the development of such a framework.

Quad Investor Network Reception

On 16 October 2023, Rebecca Shrimpton, ASPI’s Director of Defence Strategy and National Security, participated in the inaugural Quad Investment and Technology Dialogue at the White House, hosted by the Quad Investor Network. The Dialogue was supported by business leaders, investors, research institutes, and academia from all four Quad nations.

“Director of the National Economic Council Lael Brainard, Secretary of Commerce Gina Raimondo, and other senior administration officials addressed the group and discussed strategies to help unlock private capital for increased cross-border investment between Australia, India, Japan, and the United States.” – Quad Investor Network.

The ASPI DC team supported by attending the QIN reception hosted by the Australian Embassy and continues to engage in policy discussion and analysis around the Quad and Australia’s interests.

US land power in the Indo-Pacific: Opportunities for the Australian army

The US Army is undergoing its most consequential period of transformation since the end of the Cold War. The re-emergence of great power competition and a deteriorating strategic environment is forcing the US Army to rethink not just its approach to land warfare but also its future role alongside the US Marine Corps in key regions around the globe. In the Indo-Pacific, this doctrinal and structural transformation is informing a new approach to joint exercises and ‘no gaps’ defence collaboration to deter Chinese aggression. These developments hold important insights for key US allies and partners, including Australia and Japan.

Australia’s new unifying strategic approach to national defence and the high degree of convergence this has with US defence strategy offers a timely window of opportunity for the Australian Army to explore the combined use of land power in a heighten threat environment. This work should be mutually reinforcing and constitute part of Australia’s approach to managing risk and threats and balancing its contributions to deterrence.

This report aims to provide the Australian defence establishment and military leaders with well-considered options for engaging the US on matters of mutual interest. The report provides an overview of the US Army’s changing force posture and approach to land warfare, followed by a brief analysis of its evolving role as an essential enabler of joint force operations in a maritime environment. The report then explores the US Army’s ‘campaigning’ activities in the region and its efforts to increase allied and partner capacity for high-end military contingencies in all domains. Finally, the report highlights opportunities for the Australian Army to enhance interoperability with US land forces in a deepening US-Australia alliance.

Roundtable on Western strategies in the Pacific islands

On Tuesday, 3 October, the Australian Strategic Policy Institute’s DC office hosted an invitation-only, closed-door roundtable with Dr Anna Powles from Massey University and ASPI Senior Fellow Jose Sousa-Santos.

Our guests offered insights following the second U.S.-Pacific Island Forum Leader’s Summit. They discussed security trends in the Pacific region, including how Australia, the US can work with partners to counter Chinese influence, advance common interests, and support the human security efforts of Pacific island states.

Participants included representatives from the US Government, think tanks, and commercial actors.

Congressional Staff Program on Australia

From 3 October through until 3 November 2023, ASPI DC partnered with the East-West Center to deliver a bipartisan educational certificate program for congressional staffers, with a focus on Australia in the Indo-Pacific, and how it relates to the Australia-US bilateral alliance.

The series took place over six sessions, with a reception hosted at the Australian Embassy to formally close the program.

Session 1: Australia & its place in the world

Session 2: The evolution of the US-Australia Alliance and relationship

Session 3: The return of great power competition: China’s influence on regional dynamics in the Indo-Pacific

Session 4: US-Australia regional security and trade engagement

Session 5: US-Australia engagement with Asia & the rise of minilateralism in the region

Session 6: US-Australia engagement in the Pacific islands

The program included participation from senior individuals from across the Australian government, defense, industry and academia to provide informed and expert perspectives for the congressional staffers engaged in the program.

Bronte Munro interviewed by Richard Aedy at the ABC about the opportunities and challenges of Central Bank Digital Currencies (CBDCs) and their potential impact on the global financial system.

Australia is ahead of a lot of nations when it comes to trialling the potential of digital money. Central Bank Digital Currencies (CBDC’s) could change the global financial landscape and the RBA is trying to ensure they work well for Australia.

Report: Australian CBDC Pilot for Digital Finance Innovation.

Impactful mateship: Strengthening the US–Australia defence relationship through enhanced mutual understanding

AUKUS, and the Australian Government’s release of the 2023 report of the Defence Strategic Review (DSR), reinforce to Canberra and Washington DC that there’s an urgent need to continue strengthening the US–Australia alliance. Those efforts underpin allied cooperation within the Indo-Pacific, which is an increasingly complex security environment. 
 
This report highlights 9 opportunities for both US and Australian defence decision-makers at a vital time in the relationship as it develops in complexity and builds towards the ambitions of AUKUS over the coming decade. 
 
A series of ‘quick wins’ for the US DoD are recommended, including arranging more training for inbound DoD personnel and conducting allied-centric training for relevant US-based action officers and planners at US headquarters. US DoD Funding should be provided for US action officers to visit Australia to build rapport with their counterparts and facilitate appreciation for the relationship in person. Broadly, US professional military education at every level should incorporate Australian Defence-centric views when appropriate, and the DoD can better leverage its US liaison network throughout Australia earlier in planning and when considering new initiatives. 
 
Recommended quick wins for Australian Defence to include further leveraging of US-based Australian Defence personnel and encouraging greater transparency with US counterparts regarding capacity. Enhanced transparency would provide maximum clarity on capacity challenges at all echelons, especially regarding the potential impacts of a future crisis within the Indo-Pacific. It’s also recommended that Australian Defence provide greater clarity regarding sovereignty and security concerns for the US DoD. 
 
Finally, this report also makes a major long-term recommendation that will require more resourcing, coordination and focus from US and Australian defence decision-makers, and that’s to establish and empower a US Forces Australia headquarters (USFOR-A) to synergise US DoD efforts with the Australian defence establishment. It’s inevitable that the US–Australia defence relationship will grow in scope and complexity. That will quickly outgrow and challenge the current coordination structure, which was built and implemented decades ago. This report also notes that there are lessons to be learned from the US–Japan bilateral coordination mechanisms, especially in the light of the US–Japan–Australia defence relationship, as it is set to grow in importance in the coming years.