Lowy Institute

This piece by Chinese academic Wu Quiang on the domestic and international politics of China's smog problem is compelling.

A few vignettes, the first of which goes to a topic I have touched on previously, which is that the chances of a meaningful international emissions deal in Paris at the end of this year are somewhat higher than many think, because Washington and Beijing seem to be on similar terms:

President Obama and President Xi Jinping reached a deal in which China promised to reduce carbon emission by 20% by 2030. The deal was almost the sole instance of progress the Obama administration has made in the US-China relation at a time when the relationship is becoming more difficult. During the Clinton administration, the Most Favored Nation Trade Status was the issue that bound the relationship. During the Bush administration, the bond was war on terrorism. Now that these bonds have gone, the emission promise is becoming the new bond that keeps the two countries in a cooperative relationship in which they clash often but not break up. The deal is also one of the few gestures China makes to the United States and to the world that it is a responsible power and that it recognizes the international rules.

Then there are internal factors, such as the increasing influence of the Ministry of Environmental Protection:

It is also possible that the MEP will be given law enforcement authority for the first time, for example, the authority of forced inspection, search, sequestration, fines, recall and closure. We shouldn’t be surprised if in the future the MEP establishes its own environmental police force and environmental procureratorate, similar to the Bureau of Alcohol, Tobacco, Firearms and Explosives in the United States, that merges the existing forest police force and fisheries regulatory body to form a new environmental law enforcement power. After all, the power redistribution and institutional reconstruction these changes bring is in line with the increasing trend of power concentration since Xi Jinping took power. It can also be put under the banner of “comprehensively deepening reform,” providing Chinese leaders with concrete evidence to show to the world that China is taking measures to reduce emission.

And finally, there's an internal security angle to China's smog problem that I had never considered:

As face masks people wear everyday render surveillance cameras meaningless, the security organs are said to be very uneasy, fearing that the situation can spin out of control and lead to a smog revolution.

(H/t Marginal Revolution.)

Photo by Flickr user Nicolo Lazzati.


Jim Molan is dismayed by my suggestion that strategic-level policy is not the ADF's strong suit. The offending line — in an article by Sophie Morris in last week's Saturday Paper — accurately reflects my remarks to her. Jim's robust response peppers a rather larger target, however.

Among other things, he attributes to me the view that Defence civilians are much better at strategy than their uniformed colleagues. So to be clear, I do not believe that civilians are any better at providing strategic policy advice than military officers. On the contrary, had I been asked, I would have said that the depth and breadth of strategic policy expertise among civilians in the Defence Department is just as inadequate as it is among their military colleagues. This is a major problem for our defence policy which, to be fair, I believe the senior leadership of the organisation understands.

My primary point to Sophie was simply that serving in the ADF, perhaps at quite a junior level, does not in itself guarantee that a parliamentarian will have special expertise in the defence and strategic policy decisions discussed and made at the political level.

But the broader point remains true too: the ADF as an institution does not generally (with some notable exceptions) excel at the strategic-level tasks of advising governments about when and how they should use force to achieve policy objectives, and about what capabilities Australia needs.

I would offer as evidence the flawed advice that led to Australia's costly strategic failure in Afghanistan (and yes, I have no doubt that it was a failure), and the advice to acquire the amphibious assault ships (pictured), which I believe are now becoming widely recognised as the white elephants they are. I think the ADF's strategic-level advisers, along with their civilian counterparts, must take some share of the responsibility for these decisions, if indeed they spoke in favour of them or failed to speak to robustly against them.

Photo by Flickr user Crouchy69.


 New Lowy Institute polling released today shows that the Australian Government's data retention ('metadata') laws, which passed the parliament last night, have the support of a clear majority of Australians.

When asked whether 'legislation which will require Australian telecommunications companies to retain data about communications such as phone calls, emails and internet usage, but not their content' is justified, 63% of the adult population say it is 'justified as part of the effort to combat terrorism and protect national security'. Only one-third (33%) say it 'goes too far in violating citizens' privacy and is therefore not justified.'

Younger Australians (18-29) are more likely to say the legislation is not justified (47%), but this age group is divided about the policy, with 50% saying it is justified. 

'Australians appear to accept some infringements on their privacy in the interests of fighting terrorism and protecting national security,' said Lowy Institute Executive Director Dr Michael Fullilove today. 'This result is consistent with 2013 Lowy Institute polling which found that most Australians believed the government had struck about the right balance between protecting the rights of citizens and fighting terrorism.'  

This result is drawn from the forthcoming 2015 Lowy Institute Poll, the full version of which will be released in June 2015. The Lowy Institute Poll is based on a nationally representative telephone survey of 1200 Australian adults between 20 February and 8 March 2015. The Poll's error margin is approximately +/- 2.8%.  For more information see Lowy Institute press release. 


By Eva Westfield, who was an Australian volunteer based in Port Vila.

Consistently rated the most dangerous countries in the world in terms of disaster risk, Vanuatu is no stranger to the destruction caused by natural hazards.

Talk of Cyclone Pam hitting Vanuatu started about a week before it descended upon us on 13 March. Still, many were convinced that the cyclone would not hit Port Vila directly until it became clear, just two days before, that it would be one of the biggest storms to ever hit the Pacific.

Those who had sturdy housing were able to see out the storm in their own boarded-up homes. Others had to bunker down with friends, leaving their homes at the mercy of the storm. Villagers packed sandbags onto their corrugated iron roofs. Many prayed, believing that God would ensure the cyclone missed Vanuatu altogether.

As night fell, the winds picked up and it was clear that Pam had arrived. Winds would reach over 300km per hour in some parts of Vanuatu.

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Over the course of the night, the cyclone was ruthless as it ripped from the ground enormous banyan trees, bowled over towering coconut palms and lifted solid roofing from houses. Endless rain flooded homes and entire villages. 

Despite all of the preparation for the cyclone, nothing prepares you for the shock of the aftermath. By morning, fallen tree trunks had blocked every road, rolled shipping containers and beached yachts littered every part of Port Vila. Bridges between villages were totally washed away, with no way of crossing the overflowing rivers. While telephone communication in Port Vila was re-established by the afternoon, the rest of Vanuatu was silent for days to come. 

Though it is considered a developing country, the people of Vanuatu are extremely fortunate for the rich vegetation that envelops the archipelago, allowing them to live off the land sustainably. Seeing the almost total destruction of banana, coconut and cocoa plantations was the most confronting sight of all. 

Desperation was soon followed by disorder. Shops and resorts were looted, leading to a 6pm curfew. ATMs ran out of money and fuel became scarce. However, the response of the people who had experienced the wrath of Pam – villagers, expatriates, tourists – was united and overwhelmingly positive. And with a relatively low death toll of 11 people, hopes were high for a full recovery. 

Within hours, local people immediately began replanting their crops and rebuilding their homes. Locals on the island of Efate who own chainsaws took to the single road that connects villages with Port Vila and started to cut back the fallen tree trunks that had blocked the way.

Foreign aid has been pouring in from all over the world to support Vanuatu's recovery, including from Australia, France, the US and the EU. Australia has donated over $10 million in relief funding as well as $5 million to support locally-based NGOs. Over 2000 Australian military and aid personnel have also been deployed to support the effort. 

Locals, expatriates and tourists were lining up to volunteer with major NGOs that were preparing water, food and medical supplies to be delivered to those worst affected. Vanuatu's National Disaster Management Organisation coordinated the aid effort to ensure that those most in need would not miss out. 

At Port Vila Central Hospital, dozens of Australian and international volunteers have donated blood and helped local staff to restore the old wards and attend to the overwhelming influx of people. 

Shops and restaurants in town began to re-open after just a couple of days.

But while Vanuatu 'island life' seems to be back on its way to normalcy, the country faces some serious issues as a result of Cyclone Pam. Those living in more remote villages and islands waited for over a week to receive fresh water, food, medical assistance and shelter from aid vessels. These people will be relying on aid for weeks and perhaps months until their crops grow back and their rain tanks refill. 

Without local fruit and vegetables, many villages have lost their permanent food sources and their primary source of income, and soon the cost of feeding a family will be unaffordable. Tourism, an industry that Vanuatu's economy relies heavily upon, has come to a halt.

Dozens of fishing boats across Vanuatu that once provided a key part of the island diet were washed away or damaged beyond repair. Some living on more remote islands such as Tongariki and Boninga no longer have any fishing boats at all, and will have to rely on alternative sources of food until they source other boats. 

While the initial response from Australia and the international community has been encouraging, the road to a full recovery for Vanuatu will be a long one, requiring a sustained joint effort and the political will of the Vanuatu and supporting governments to re-build this beautiful country. 


Lei Jun reckons he has what customers really need. Xiaomi's flamboyant chairman has declared his ambition to overtake Apple at the top of the smartphone industry within ten years, by which time he expects 'Chinese companies to lead the world.' Whether he will succeed is, obviously, up in the air. For that matter, by then Apple may no longer be the benchmark, nor smartphones a sexy category. But his basic point must be right: China will wield a large number of globally competitive companies within a decade.

Two academics, economist Ricardo Hausmann and statistician Cesar Hidalgo, performed a famous and extraordinarily detailed data crunch, 'The Building Blocks of Economic Complexity', comparing the current and potential national incomes (GDP) of the world's economies, and their trade patterns. Their findings were intuitively sensible:

Economies that export many types of products are more likely to be sophisticated; products exported only by sophisticated economies are more likely to be complex. Sophistication and wealth do not always go hand in hand. China and India are more complex than their incomes would suggest; When economies are relatively sophisticated but relatively poor, they often have the potential for quick growth, as we have seen in China and India.

Economic complexity is a measure of both 'non-ubiquity' (or exclusivity), and diversity (or breadth). Wealthy exporters like Japan and Germany make a broad spread of hard-to-copy technologies. They 'go wide and deep', so to say. By contrast, countries heavily reliant on undifferentiated commodity products tend to struggle to grow incomes.

As Mark Buchanan at Bloomberg has highlighted, other academics applying powerful Big Data techniques have shown limitations to the Hausmann-Hidalgo framework as a predictor of income for lower-complexity nations (where, say, resource endowments or governance could be disproportionately influential). But it remains a useful guide for the countries that matter most, those with an 'ability to produce a wide range of products, as well as specialized things – think iPhones and rocket boosters – that few other nations can match.' Specifically, Buchanan is referring to India and China. 'The two have been building capabilities in a wide range of new products and skills, and have thus graduated into the group of countries for which complexity does predict growth.'

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Still, there are a couple of wrinkles to using export classifications alone as a measure for complexity; on such a scale, Uganda (say) looks more advanced than soybean superpower America. China exports a lot of advanced goods (40% by some measures) but its own contribution is significantly lower, Apple's iPhone being the familiar example. Merchandise exports also ignore services (eg. IPR, branding, health care, consulting, financial and legal advisory) which are specialised, with high-entry barriers, and are therefore lucrative.

Chinese economists fully understand this. Zhang Monan has warned about the misleading signal of final exports. It is not enough simply to send abroad assembled 'high-tech' products and services if the most critical technologies and skills are already embedded in the components by others. In the recently concluded National People's Congress, Premier Li Keqiang delivered a workpaper re-prioritising domestic mastery of key capabilities – robots, high-end marine vessels, new-energy vehicles, high end medical devices, biologic pharmaceuticals, gas turbine aero-engines, integrated circuits, and advanced internet – within a decade.

Zhang lists her worries in a domestic opinion piece: China is 'big' but not efficient, innovation is still weak, the usual 'latecomer advantage' may not apply to its 'catch-up', the nation is losing talent to others, and the 'window of opportunity is closing rapidly.' This last argument is curious, made in an era of globalisation when the horizons for cross-border collaboration seem to be expanding. Yet Zhang sees other countries spurred (especially since 2009) to stimulate indigenous innovation programs, partly in response to China's ambitions. Beijing has long complained about Western technology export restrictions, and now it is playing rough itself: 'We just did what the Americans have already done; you can choose to leave, we have substitutes' seems to summarise the new line. Perhaps Zhang senses danger in such mercantilist industrial policy.

Xiaomi's chairman hopes to build a world-class Chinese enterprise. The question is not whether there will be such companies; it's whether there will be enough. China has only one path to getting rich: to have a very deep and very wide economy. I have noted before that China's rise to high complexity status must be disruptive. Trade isn't a zero-sum game; there can be more winners than losers. But there are losers, and they look like Detroit. The perpetual race for national power is, at its root, an economic contest. Rich, complex economies have many companies providing things that customers need, and can afford. From a developmental perspective, nothing else matters.

Photo by Flickr user David.


The Asia Pacific is the most dynamic digital landscape in the world, home to the fastest adopters of new technologies and the largest concentration of mobile and social media users. An escalation in online activism, changing cyber dynamics, developments in digital diplomacy and the exploitation of big data are shaping the region's engagement with the world.

  • India's Supreme Court has struck down a law that made it illegal to spread 'offensive messages' on electronic devices. The presiding judge said the law, which had resulted in arrests over Facebook posts, had a 'chilling' effect on free speech.
  • University of Toronto's Citizen Lab has found that hundreds of members of the Tibetan community are being targeted by email-based malware attacks that are using the anniversary of the 10 March 1959 Tibetan Uprising as a disguise to infect individuals and organisations.
  • A fantastic report on Vietnam's social media landscape highlights internet censorship and outlines how social media is challenging the country's state-controlled broadcast and print media.
  • Indonesian neuroscientists have a developed a mobile app to help reduce the risk of accidents by using a brainwave sensor device to evaluate driver performance. The app pulls together vehicle data and real-time environmental data (traffic, weather), which is then meshed with information collected from the driver (stress levels, alertness) to make a call on whether you should drive.
  • Japan is reaping the benefits of an Asian-driven demand for robots (Taiwanese company Foxconn uses 20 million robots in its production of the iPhone 6 alone). India wants in, and is eyeing off opportunities for its tech industry (particularly programmers) to better collaborate with Japanese manufacturers.
  • And while Japan regularly capitalises on its robotics expertise via well rehearsed 'robot diplomacy', it's unlikely Germany's Chancellor Angela Merkel will be buying a personal robot anytime soon:


Even for long-time watchers of the Middle East like myself, the region's enmities and alliances have become very difficult to keep track of.

This has just been taken to a mind-bogglingly new level by Saudi Arabia's decision to launch a military campaign in Yemen against the Houthi movement.

Last September the Houthis, backed by Yemen's deposed president, Ali Abdullah Saleh (whom the Houthis fought against in 2009), stormed the Yemeni capital Sana'a. Since then they have captured large parts of the country, forcing President Abd Rabbuh Mansur Hadi to flee to the southern city of Aden.

The Houthis are Zaidi Shia, and are seen as closely aligned with Iran, which is a key reason why the Saudis, backed by other Gulf allies and seemingly by the US, have now intervened. But the Houthis are also fighting al Qaeda elements and Islamic State supporters in Yemen.

So in Iraq and Syria, the US, backed by Saudi Arabia (at least nominally), is fighting against al Qaeda and Islamic State, and both groups are also being fought by Iran. But in Yemen, Saudi Arabia, backed by the US, is fighting against the Houthis, who are supported by Iran but who are fighting al Qaeda and Islamic State. 

Confused? So am I.


In a speech to the National Press Club yesterday, Foreign Minister Julie Bishop said she is 'scoping the opportunities for our next term on the United Nations Security Council.' 

Australia performed well during its 2013-2014 term on the Security Council, and the time has come for a decision to be made about the next term. It would be a welcome change if a bid were to be launched under a Liberal government.

It is a commonly held perception that the Labor Party is friendlier to the UN than the Liberal Party. Australians themselves are largely supportive of the UN: 63% hold a favourable view of the organisation. Labor stalwart Dr HV Evatt was the great agitator on behalf of medium and small nations at the founding conference in San Francisco, 1945. He later served as the fourth president of the General Assembly.

The Liberal Party, on the other hand, is seen as being more conflicted over the UN. The Howard Government worked ably with the UN on Timor, while it later rode roughshod over the rules-based order when it joined with allies the UK and the US to invade Iraq.

In 2000, Alexander Downer famously derided the UN, saying that, 'if a United Nations committee wants to play domestic politics here in Australia, then it will end up with a bloody nose.' He was later appointed UN Special Envoy to Cyprus.

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But there is a healthy pro-UN camp within the Liberal Party. Dr Russell Trood founded the UN Parliamentary Group while serving as a Liberal senator. The group is now co-chaired by Melissa Parke MP (Labor) and Senator Chris Buck (Liberal). Trood is now chairman of the UN Association of Australia, succeeding the former Liberal senator Robert Hill (former defence minister and former Australian permanent representative to the UN).

Other voices in the party tap into the anti-UN sentiment, which runs deep on the hard right (ie. the 28% of Australians that hold an unfavourable view of the UN). But this sentiment is born mostly of ignorance of the UN system and its limitations. But it is not as suspicious a minority as that in the US, where the positively unhinged 'black helicopter' conspiracy theorists continue to irrationally oppose the Arms Trade Treaty and Agenda 21 (a non-binding pact on sustainable development) for fear that the UN will one day take over the world.


A couple of weeks ago, Prime Minister Abbott suggested that Australians were 'sick of being lectured by the UN.' In opposition, the Liberals also opposed the bid for a seat on the Security Council, citing issues of cost and timing.

In keeping with the Liberal Party's contradictory approach to the UN, Foreign Minister Julie Bishop actually took advantage of the seat, and performed admirably on numerous occasions (on MH17 and during the presidencies of 2013 and 2014). During her speech yesterday, Bishop espoused the virtues of Australia's term on the Council: 'I believe we exceeded expectations of the impact that we could have as a non-permanent member.' By all accounts, the P-3 (France, US, UK) enjoyed Australia's company on the Council, while the Russians found us a worthy adversary.

Bishop also took the opportunity to focus more broadly on the question of how Australia would look to build a post-Council legacy. She signaled Australia's intention to support 'efforts to strengthen the effectiveness of both United Nations peacekeeping and peacebuilding.' This support is timely. Jose Ramos-Horta's High Level Independent Panel on Peace Operations delivers its report in the middle of the year and Obama hosts his summit on peacekeeping at UN HQ in September.

Bishop also made mention of the need to 'ensure women are more deeply engaged' in the UN's efforts towards peace. This flags ongoing Australian support for the women, peace and security agenda enshrined in resolution 1325.

This year is a big year for the UN, which is celebrating its 70th Anniversary, and the options for meaningful engagement are plentiful.

On the immediate horizon will be the Palestinian Question (as it is known at the UN). Although Bishop made no mention of it in her speech, the recent Israeli election result could prompt a showdown at the UN some time this year. With the Obama White House signalling a potential change its stance at the UN, it remains to be seen whether Australia too will alter its policy. The UK and France are also likely to push for the recommencement of final status negotiations.

The Millennium Development Goals are up for renewal. The new post-2015 development agenda promises to be more inclusive and far reaching.

The UN's humanitarian architecture is also under immense strain brought on by a record number of IDPs and refugees (57.5 million), a result of the numerous crises afflicting the Middle East, North and Central Africa. US$ 16.4 billion will be required this year alone.

Despite the UN's growing needs, Australia's brand of niche diplomacy is likely to get more of a workout than its cheque book (or the boots of ADF personnel).

Photo courtesy of the Foreign Minister.


Just over a decade ago Illicit: How Smugglers, Traffickers and Copycats are Hijacking the Global Economy, hit bookshops around the world. Written by the then editor of Foreign Policy and former Venezuelan Minister of Trade and Industry Dr Moises Naim, Illicit outlined how the 'black' economy risked undermining the regulated economy, reshaping politics to the detriment of societies and destroying lives around the world.

Illicit received widespread praise for its thoroughness and accessibility. Some reviewers, however, suggested that Naim had overstated the impact illicit actors were having on states' abilities to regulate the movement of goods and people. Other reviewers commended him for persuasively arguing that illicit trade patterns threaten 'the very fabric of society' itself.

Ten years on from Illicit, what has changed? Have responses been effective or is the threat Naim outlined still present?

Naim's book covered illicit industries ranging from small-arms trading to illegal drugs to money laundering, but this column focuses on one area: migrant smuggling. Back in 2005, Naim argued that smuggling and its more sinister manifestation, human trafficking, were both growing illicit trades. He cited UN estimates that the combined business in smuggling and trafficking was worth US$7-10 billion annually.

Today, there is little doubt that migrant smuggling continues to pose many challenges, including for migrants risking death and exploitation during their journeys, and for states seeking to manage their borders. The patchy data available on smuggling indicate the number of people being smuggled around the world appears to be increasing overall, albeit unevenly geographically. It also seems that an increasing number of illicit actors are making considerable profits from that exploitation. Some estimate that up to US$1 billion was paid to smugglers along the Mediterranean Sea route alone in 2014.

The latest EU data show that 2014 saw a massive increase in illegal cross-border detections, most notably by sea across the Mediterranean, with almost 100,000 people being smuggled by sea between July and October alone. The use of cargo ships to smuggle on a larger scale in the Mediterranean, such as the recent Ezadeen ghost ship abandoned at sea by its crew, is an ominous sign that migrant smugglers are reaching a new scale of operational capacity.

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African-based analysts have found that while the true scale of regional smuggling and irregular movement is difficult to quantify, the smuggling route to Europe via Libya continues to grow. They have also highlighted that in Libya migrant smuggling is directly linked to the smuggling of drugs and weapons, placing asylum seekers and refugees in the hands of criminal gangs.

US Border Patrol data stretching back several decades shows a big drop in illegal migrant apprehensions across the Southwest border with Mexico from the onset of the global financial crisis in 2007, however last year saw smugglers fill a soft market with extremely vulnerable migrants from Central America. The number of unaccompanied minors and families with minors who were apprehended in FY 2013–14 almost tripled to around 135,000, undoubtedly sending a collective chill through the spines of policy makers, international organisations and migrants' rights groups worldwide.

Closer to home, some of the largest migrant smuggling routes are thought to be in Southeast Asia, particularly between Indonesia and Malaysia. Analysts estimate the illegal migrant population in Malaysia to be around 2.2 million, with more than half from Indonesia.

Smuggling of asylum seekers to Australia is now in abeyance, at a time when factors enabling smuggling — modern transportation and communication networks; the growing prevalence of opportunistic unregulated actors — have perhaps never been greater. The current policy and operational framework in Australia has halted maritime migrant smuggling, but it is fragile in the face of such global forces, and it has come at a substantial cost.

Ten years on from Illicit and it's difficult to say whether the 'very fabric of society' has been irreparably harmed, though some communities in some societies have experienced just that. What is clear is that few inroads have been made in eradicating human smuggling globally in a substantive and sustainable way. There are at least three main reasons.

Firstly, there remain significant gaps in our understanding of migrant smuggling. Patchy data indicate that some smuggling routes are closely monitored while others are not; some smuggling routes have been effectively shut down while others appear to be flourishing. Improved data collection and targeted research is enhancing our understanding of smuggling but we still don't know the true scale and nature of many smuggling networks. We have a limited understanding of how inter-connected smuggling is with other forms of illicit activity; we may not yet appreciate the level of danger and insecurity experienced by those being smuggled.

Secondly, it is clear that while migrant smuggling is big business and multiple factors underpin the phenomenon (including poverty and relative deprivation), we are now in the midst of the largest episode of human displacement due to war, conflict and persecution seen for two decades. This has a direct effect on smuggling. EU data show that Syrians currently make up the majority of those intercepted in the Mediterranean Sea. Greater support of countries hosting refugees, realising the end of conflict in places such as Syria, and expanding durable solutions to displacement are all high global priorities.

Finally, a transnational problem requires transnational solutions involving multiple sectors and stakeholders that complement national initiatives. Policies, practices and operational responses that can account for international smuggling patterns, industry-specific labour needs and better industry regulation, international monetary flows, migrants' rights and motivations, as well as transnational linkages, have a greater chance of reducing migrant smuggling, securing borders and enhancing protection. There remains much work to be done.


Alan Dupont concludes his thoughtful response to my comments on his Lowy Analysis paper, Full-Spectrum Defence: Re-thinking the Fundamentals of Australian Defence Strategy, by posing some good questions.

First, he asks, should we see irregular warfare as the dominant form of future conflict, both between and within states? The answer depends on what we mean by 'dominant'. Do we mean 'most common' or 'most serious'? Irregular warfare is likely to be the most common form of conflict in future, as it always has been in the past. What I suppose we must call 'regular warfare' – large-scale conflict between the armed forces of states – has always been much rarer, and I expect this will remain true too.

But regular warfare is more serious than irregular warfare, at least for a country like Australia. If we were Yemen or the Congo or (for much of its history) Indonesia, then irregular warfare would pose a more serious threat than regular warfare, and it would make perfect sense to design our armed forces primarily for that kind of conflict.

But we face no credible or even conceivable risk of internal insurrection, and no risk of insurrections spilling onto our territory from elsewhere on anything but the smallest scale, a scale for which police are more relevant than armed forces. And the risk of state-sponsored irregular warfare against Australia by a neighbouring state was tested at length by the 'low-level contingency' concept which was so central to our defence policy in the 1980s. I think Alan would agree with me that the closer one looked at that concept, the more improbable it seemed.

Of course the risk of Australia being involved in a regular conflict is pretty low too. But I would argue that changes in the regional strategic order mean it is not as low over coming decades as it has been since the early 1970s, and that this risk is much more serious for Australia than risks of irregular warfare. And that is why I think it should predominate in our force planning.

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Second, Alan asks whether the 'force structure determinants' used in previous White Papers 'have any redeeming value'. By 'force structure determinants' Alan means the core strategic objectives which the Government decides the ADF should be built to achieve, and which therefore determine what kinds of forces we need and how much money we should spend.

I think setting these strategic objectives for the ADF does have value. Indeed I think deciding what we want our armed forces to be able to do is absolutely essential to making sensible decisions about what capabilities we need. In his paper, Alan says they are no use because governments sometimes ignore them in choosing capabilities, and often use the ADF for tasks different from the ones they identify as force structure determinants.

He is quite right about both of these, but that does not mean the idea of setting core objectives has no value. Governments do sometimes violate their own policy principles (the Howard Government did when it ordered the C-17s that Alan mentions), but the fault here might lie with government decisions rather than the principles they sometimes ignore.

More importantly, the fact that governments use the ADF for purposes other than that for which it was designed does not mean it has been designed for the wrong purposes. It often makes sense to use something for a purpose for which one would not buy it.

There is a separate question, of course, about whether the strategic objectives that have been laid down as force structure determinants in recent white papers are the right ones for Australia over coming decades. I do not think they are, because they assume that Australia's strategic risks will remain much the same in the next few decades as they have been in the last few. What objectives we should adopt instead is a question for another time.

Third, Alan asks whether I still think we should have a primarily maritime military strategy, and if so how space and cyber fit into it? The short answer to the first part is 'yes'. Most of the core strategic objectives I would set for the ADF can be achieved most cost-effectively by maritime operations, and I would focus most of our capability there.

What about cyber and space? Let's clear up a muddle here: when we talk about cyber and space as new domains of warfare, are we talking about the impact of cyber- and space-based actions on the systems that support and enable the conduct of conventional military operations in the other three domains, or are we talking about the impact of such operations on society more broadly, to achieve a direct strategic effect?

If it is the former, then clearly we need to develop our maritime forces to operate in a contested cyber and space environment, based on a sober assessment of the risks involved. This might be hard technically, but it poses no conceptual challenges to policy.

If it is the latter, the issue is much less clear. Cyber attack on national information systems is a serious potential threat, but armed force is little or no use in responding to it, so it need not shape our defence planning. Space-based attack directly on civilian populations or systems? Unless we mean such familiar problems as ballistic missiles, I'm not sure what we are talking about here. Denial of satellite services, perhaps? Whatever it is, I doubt that armed forces are going to be the answer.

Photo by Flickr user DVIDSHUB.


The Indo-Pacific is a strategic system encompassing the Indian and Pacific oceans, reflecting the expanding interests and reach of China and India as well as the enduring role of the US. The Lowy Institute's International Security program presents a weekly selection of links illuminating the changing security picture in this increasingly connected super-region.

  • US Senators who head the Senate Armed Services Committee and the Senate Foreign Relations Committee have sent a letter to Secretary of State John Kerry and Secretary of Defense Ash Carter expressing concern over China's expanding land reclamation efforts in the South China Sea. The disputes in the East China Sea also need some crisis management attention.
  • Has the US-UK split over the whether to join the Chinese-backed AIIB exposed significant divisions over the question of how to accommodate a rising China?
  • Sam Roggeveen was in India last week and has written on his impressions of the country's strategic debate.
  • The Indian Navy has raised alarm with the government over China's deployment of a nuclear attack submarine to the Indian Ocean late last year. 
  • China now operates more attack submarines than the US. But the US Navy is confident that it retains a qualitative advantage.
  • It seems China has invited Japan to its World War II commemorations in September. Also, Japan's largest warship since the war, a helicopter destroyer, has entered service.
  • The Japanese Self Defense Force intercepted more Russian Tu-95 bombers off Japan's coast this week.

Throughout the P5+1 negotiations with Iran over its nuclear program, we've been treated to constant commentary on why a nuclear agreement with Iran is a terrible idea.

But none have been as ridiculous as this from Joshua Muravchick. According to him, war with Iran is a better way to prevent it from going nuclear. He couldn't be farther from the truth.

The best way to assess the success of a policy is to examine what it's trying to achieve. What would be the goal of a military campaign against Iran? Presumably, to stop Iran getting a nuclear weapon. But military action doesn't guarantee the destruction of Iran's nuclear program. In fact, it makes a nuclear Iran more likely.

Those who endorse strikes against Iran advocate for an air campaign targeting Iranian nuclear facilities. But Iran's nuclear program is no Al-Kibar or Osirak. Iran's nuclear program is far more extensive and spread out than those targeted in the past by the US and Israel. What's more, it bears reminding that some facilities are impenetrable, or at the very least, very difficult to penetrate because they are too far underground. Iranian facilities are also well protected and Iranian air defences are solid.

Total destruction of the program is, to put it mildly, highly unlikely.

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If everything hasn't been destroyed, then it can be rebuilt. What then? Can the US or Israel commit to 'mowing the lawn'; striking Iranian facilities every few years? Iran would likely rebuild its facilities further underground and hidden from all. Each successive attack would need more firepower and better intelligence. Not an easy commitment to make. 

Now let's assume that all of these obstacles are overcome. Let's assume that a military operation against Iran destroys all of its (known) nuclear facilities. What of the information, data and skills that remain? Knowledge can't be bombed away. 

Instead, military action will play beautifully into the hands of the Iranian Government. It will give them a legitimate excuse to forgo its non-proliferation commitments and go hell for leather on the nuclear program. It will encourage Tehran to drive the program underground and cease all transparency. Muravchick argues that if Iran currently has hidden facilities, they'll be hidden from an agreement too. Perhaps, but the aim of an agreement is to ensure that Iran submits to the most stringent inspection regime devised to date. Surely that's a step up from nothing, which is what we would be left with if force is used.

Military action will also give the Iranian Government more ammunition for its anti-American rhetoric. The Islamic Republic thrives off external enemies. What better way to galvanise support for Iran's leaders than to be the victim of airstrikes? That would turn even the most moderate Iranian against the West. And let's not forget the international community; even US allies are unlikely to back military action if there is no obvious Iranian-caused tripwire.

Finally, military action will spark retaliation. Sure, Iran may be deterred from anything too drastic. But the use of force has been on the table for 20+ years, and it hasn't deterred Iran from using its proxies and pursuing its interests. Iran may refrain from closing the Straits of Hormuz, for example, but that's only because it stands to lose the most from closing it. 

It's not just that, as Muravchick acknowledges, there 'are risks' to military action, it simply won't work. In fact, it is bad policy because it clearly results in the opposite end-state from the stated goal of stopping a nuclear Iran. 

Photo courtesy of Flickr user US Department of State.


First, let's get past the histrionics over the Asian Infrastructure Investment Bank (AIIB). Beijing undoubtedly has scored a symbolic diplomatic win over Washington, whose stance increasingly looks churlish. The Chinese have prevailed in what may become an epic saga of skirmishes over the outmoded Bretton Woods system.

They were always going ahead with their overseas investment efforts, with or without Washington's support. It is understandable that other countries should now reconsider 'getting inside the tent' when the AIIB initiative has gained so much momentum. Many American experts recognised early that opposing AIIB was a strategic error, especially when Congress had blocked attempts to reform the IMF. Their Chinese counterparts now supposedly gloat over Washington's 'petulant and cynical' sulking.

Look more closely at this situation and it gets even stickier. Development banks are unwieldy politically driven bureaucracies that submit even the most honourable objectives to a soul crushing ritual of arbitrary decision-making, petty infighting, endless red tape, shelved reports and, frequently, corruption. I should know; I worked as adviser to a major multilateral lending agency some years ago in the Indian energy sector. Well-paid delegates would arrive from everywhere on lavish travel budgets, bearing no apparent relevance to a given project, which after two years would run full circle, ending where it had started. Apparently this wasn't an unusual experience, either then or now. Lou Jiwei, China's finance minister, rightly queries why international standards should be his aspiration: 'I don't acknowledge best practice. Who is the best?'

Although influence and power are what's at stake, the battle over the AIIB is technically about governance. In theory, making this Chinese-led institution a multilateral one should improve transparency and objectivity.

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A major gripe about existing institutions is that they bestow veto rights upon incumbent hegemons (the US and Japan, notably) who hold under 20% of the equity capital. China intends to own 49% of AIIB. Its offer to surrender the veto is an empty gesture; practically Beijing's will could only be blocked if every other shareholder opposed it. And when it comes to building infrastructure, Beijing thinks best practice is Chinese practice: brusque, efficient, decisive. 'Bureaucratic procedures and tedious methods' such as public consultation or EIAs are spurned. As Lou says, 'we need to consider (developing countries') needs and sometimes the West puts forwards some rules that we don't think are optimal.'

Another complaint about today's development institutions is that they prioritise the preferences of the sponsor. Examining the Asian Development Bank's (ADB) disbursements against a range of geopolitical criteria, Christopher Kilby showed that 'both Japan and the US have systematic influence over the distribution of ADB funds.' Two other academics, Edward Lincoln and Karen Mingst, have even documented American (!) complaints about Japan's outsized role in the ADB. China may exert similar influence in favour of its pet projects, its allies and its own contractors, just as the Japanese did. According to one estimate, locals in Vietnam got only 3% of the money doled out by ADB there during the last fifty years.

Development banks underwrite risks that a huge and capable global private sector is not coordinated or motivated to take on. That means making non-commercial lending as commercial as possible, so politics inevitably is involved. No doubt China earnestly wishes to improve its neighbours' transport linkages, for example, and that is a win-win outcome. But when AIIB's tenders come in for the bullet-train line through Cambodia or Kyrgyzstan, we can be sure which country will oversee, manage, supply and construct the railway.

Roughly 30 countries have signed on, but it is telling that recent Western joiners, such as Australia and Britain, have overtly emphasised their commercial interests. These countries think they see a giant money pot. Their wishes are forlorn. Concessionary lending makes poor business, and Chinese contractors and suppliers can easily undercut foreign companies.

Still, the AIIB is good news. There is no shortage of need in the world, and different institutions can complement each other. Just as the World Bank targets poverty and public health, the AIIB is aimed at regional infrastructure building, where the ADB reckons there is a US$800 billion annual shortfall. This happens to play to China's industrial strengths and it is encouraging that, at least, the AIIB is inviting others for the ride. Alternative Chinese initiatives are far more parochial, like the colossally unaccountable China Development Bank or the mercantilist Silk Road Fund.

In fact a chastening experience in Sri Lanka or Venezuela might lead Beijing to better appreciate the advantages of good governance. Because for all the yelping about the 'riven west' choosing between 'accommodation or appeasement', there is a serious practical issue of rules here. Put simply, does the world trust China to do the right thing? If Beijing builds a parallel geo-financial order, will others have a voice? How fair will it be? In this regard, the AIIB has been challenged to match other multilateral agencies. It should aim higher.

Photo by Flickr user The Climate Group.


One of the stranger stories to come out of Syria lately was the case of Northern Territory Labor Party president Matthew Gardiner's disappearance to Syria to fight against ISIS. Mr Gardiner upped and left his wife and family to join the ranks of the Kurdish YPG. Only two weeks later, another Australian, Ashley Johnston, became the first foreigner reportedly killed fighting ISIS, also with YPG.

The Syria conflict has made for some awkward alliances and strange bedfellows. But these two cases present a particularly complicated legal predicament in the realm of Australian counter-terror law.

Peshmerga forces in action against ISIS. (Flickr/Times Asi.)

YPG is considered the military arm of the Democratic Union Party (YPD), the Syrian branch of the Kurdistan Worker's Party (PKK), a Kurdish socialist guerrilla army behind an insurgency against Turkey, a conflict that has killed over 40,000 in the last three decades. The PKK is listed as a terrorist organisation by the EU, US, and Australia. It is the only non-Islamic organisation on the terror list in Australia.

Kurdish factionalism is a complex beast. There is little love lost between the outlawed PKK, based in the Qandil Mountain area of northern Kurdish Iraq and the Eastern Turkish border, and the Peshmerga, the legitimate armed forces of the Kurdish Regional Government which governs semi-autonomous Kurdish Iraq. However, the emergence of ISIS has seen interests converge. Kurdish factions, rivalrous Shiite factions, the Iraqi army and even some Sunni tribes have united in the battle against the militants.

With coalition air cover to help them, the battle-hardened YPG has emerged as the key partner for the US-led coalition fighting ISIS in the Syrian city of Kobani, on the central northern border with Turkey. PKK, YPG and Peshmerga forces battled ISIS for months to win back the city in early February.

Australia is of course a partner in the US-led alliance against ISIS. The coalition is arming and training the Iraqi Army, and providing air cover to local partners in Iraq and Syria. The Royal Australian Air Force joined the US-led coalition against ISIS in Iraq in October, and in March the Government announced an additional 300 troops will join the nearly 200 already assisting Iraqi security forces and the 400 Air Force personnel conducting air strikes against ISIS in northern Iraq.

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But just as the US-led alliance is providing arms and training to the Iraqi armed forces, so the Iraqi Army is partnering with the Peshmerga. And in turn, the Peshmerga is teaming up with the YPG. This reporter has witnessed YPG-Peshmerga cooperation in northern Syria, and it is safe to say that arms directed to the Iraqi Army will end up in YPG hands. They may even end up in the hands of Matthew Gardiner as he battles ISIS.

Yet under Australian law it is a criminal offence to fight with any side in a foreign conflict. It is also an offence to be a member of any terrorist organisation. A new foreign fighters bill passed in October last year makes it an offence to travel to certain conflict zones other than for legitimate purposes.

The Australian Federal Police is reportedly investigating Mr Gardiner and he could face prosecution on return to Australia. Attorney General George Brandis says that 'participation by Australians in the Syrian civil war is against Australian law, irrespective of which side they are fighting on...Those who contemplate travelling are putting themselves in mortal danger. Those who are already there should leave the conflict zone immediately...there are safer, legal ways of helping the people affected by these conflicts than travelling overseas to fight'.

So far, there have not been any prosecutions of Australians involved in fighting with the PKK, the YPG or the Kurdish Peshmerga. Nor have there been any prosecutions of Australians for terrorism offences relating to the PKK.

One way to get around this awkward contradiction would be to de-list the PKK as a terrorist organisation. The PKK was first listed under a Criminal Code regulation in 2005 and was last re‑listed on 18 August 2012. The 2012 listing expires on 18 August and will be reviewed again before that date.

There several good arguments for removing the PKK from the list. One is that could pave the way for direct cooperation between the YPD and the US against ISIS. It could also give the peace process between the Kurds and Turkey extra steam. The leader of the PKK, Abdullah Ocalan, agreed from his prison cell in May 2013 to a pact ending hostilities and withdrawing fighters from Turkish soil, paving the way for a full settlement. The PKK was originally listed by the US as a terrorist organisation in 1997 at Turkey’s urging and at the peak of hostilities. But now, as he approaches a general election in June, a final settlement of the Kurdish question will also prove critical for Turkish President Recep Tayyip Erdogan. 

But that doesn't solve the problem of what do about Australians providing support to the PKK or traveling to Turkey, Iraq and Syria to fight on 'our side', and afterwards potentially coming home. It appears the only solution to that quandary is to ignore it, at least selectively, and hope no other high profile Australians fighting against ISIS make the press.


In a new Lowy Institute Analysis paper released today, Howard Bamsey and Kath Rowley argue that a failure to pay high-level attention to international climate change negotiations raises several risks to the national interest. Australia and Climate Change Negotiations: At the Table, or on the Menu? argues that climate change negotiations are changing the global economy in ways that matter to Australia. Strong, constructive engagement in those negotiations by Australia would serve climate, economic and other national goals.

'As one of the world's biggest fossil fuel producers and exporters, Australia has an important stake in when and how the world pursues emissions reductions,' say Bamsey and Rowley.

Climate change negotiations will create new norms, standards, rules and laws. These developments create challenges and opportunities for Australian businesses and individuals. Bamsey and Rowley argue that ministerial leadership, a strong negotiating team, and active support for preparations for the Paris conference in December would return much needed momentum to Australia's negotiating effort.

Read or download the Analysis from the Lowy Institute website.

Photo by Flickr user The Danish Wind Industry.