August 10, 2018

Imran Khan's Silk Road journey: Why Pakistan's economic dependence on China is set to grow

The two states will continue to view each other as important partners, especially as India’s rise continues to worry Islamabad and cause anxiety in Beijing.


 |  MUSINGS FROM AFAR  |  5-minute read |   10-08-2018


As economic pressure mounts for Pakistan, it is becoming clear that the new government of Imran Khan will have to borrow $12 billion from the IMF to ease pressure on dwindling foreign reserves and repay overseas loans.

Pakistan is reeling from an economic crisis and the IMF is its saviour of last resort. But there’s a twist in this tale as the US Secretary of State, Mike Pompeo, has announced that Washington would block an IMF bailout package for Pakistan if it is used to repay Chinese loans borrowed under the multi-billion-dollar China Pakistan Economic Corridor. Pompeo underlined that American taxpayer dollars were part of IMF funding and, therefore, the US government would not allow a bailout package for Pakistan that could be used to repay Chinese creditors or the government of China.

Growing reliance

In his victory speech, Imran Khan had declared: “Our neighbour is China, we will further strengthen our relations with it”, arguing that “the CPEC project which China started in Pakistan will give us chance to bring in investment to Pakistan.” Beijing, for its part, had also welcomed the new government, hoping for political stability and economic viability.

Soon after the elections, China had lent $2 billion loan to Pakistan to keep its doddering economy afloat. All this has reinforced the growing reliance of Pakistan on China as a source of financial, diplomatic and military support at a time when Pakistan’s ties with the US have entered into their worst phase ever. Though in an ideal world Pakistan would like to balance the US and China, but its dependence on China is only likely to grow in the future and Imran Khan’s government will have little ability to change that.

There is something not quite right about an inter-state bilateral relationship when words such as “higher than the mountains, deeper than the oceans, stronger than steel, dearer than eyesight and sweeter than honey” are used repeatedly to describe it. No other relationship depends so much on flowery language to underscore its significance as the China-Pakistan does. Imran Khan’s predecessor Nawaz Sharif had also made his maiden trip as Pakistan’s Prime Minister to China where at the Great Hall of the People in Beijing, Sharif had said his welcome “reminds me of the saying, our friendship is higher than the Himalayas and deeper than the deepest sea in the world, and sweeter than honey.”

To show China how seriously it is taken in Islamabad, Sharif had introduced a ‘China cell’ in his office to speed up development projects in the country. This cell was to supervise all development projects to be executed with the cooperation of Chinese companies in Pakistan. This was an attempt to address Chinese concerns about the shoddy state of their investment in Pakistan because of the lackadaisical attitude of the Pakistani government. Meanwhile, Beijing too needs the political and military support of the Pakistani government to counter the cross-border movement of the Taliban forces in the border Xinjiang province.

Pakistan enjoys a multifaceted and deep-rooted relationship with China underpinned by mutual trust and confidence.  In fact, Pakistan enabled China to cultivate ties with the West, particularly the US, in the early 1970s, as Pakistan was the conduit for then-US National Security Advisor Henry Kissinger’s landmark secret visit to China in 1971 and was instrumental in bringing China closer to the larger Muslim world.

Over the years China has emerged as Pakistan’s largest defence supplier. The Pakistani nuclear weapons programme is essentially an extension of the Chinese one. This is perhaps the only case where a nuclear weapon state has given weapons-grade fissile material — as well as a bomb design — to a non-nuclear weapon state.

(Photo: PTI)

Chinese policy

China was perhaps the only major power that openly voiced support for Pakistan after Osama bin Laden’s assassination in May by publicly affirming that “Pakistan has made huge sacrifices and an important contribution to the international fight against terrorism, that its independence, sovereignty, and territorial integrity must be respected, and that the international community should understand and support Pakistan’s efforts to maintain domestic stability and to realise economic and social development.” It is an openly stated Chinese policy that it would like to be an “all-weather strategic partner” of Pakistan.

At a time when Pakistan is under intense scrutiny for its role in fighting extremism and terrorism, the world has been watching with interest to see how China decides to deal with Pakistan. While pressure has been piling up from the West, Beijing has continued to affirm that “Pakistan has made huge sacrifices and an important contribution to the international fight against terrorism, that its independence, sovereignty, and territorial integrity must be respected, and that the international community should understand and support Pakistan’s efforts to maintain domestic stability and to realise economic and social development.”

Asymmetrical ties

The Sino-Pakistan relationship remains fundamentally asymmetrical: Pakistan wants more out of its ties with China than China is willing to offer. Today, when Pakistan’s domestic problems are gargantuan, China would be cautious in involving itself even more. Moreover, the closer China gets to Pakistan, the faster India would move into the American orbit. Amid worries about the potentially destabilising influence of Pakistani militants on its Muslim minority in Xinjiang, China has taken a harder line against Pakistan. The flow of arms and terrorists from across the border in Pakistan remains a major headache for Chinese authorities and Pakistan’s ability to control the flow of extremists to China at a time of growing domestic turmoil in Pakistan would remain a major variable.

As the Western forces move out of Afghanistan, Beijing is worried about regional stability and is hoping against hope that close ties with Pakistan will make it safer. The two states will continue to view each other as important partners, especially as India’s rise continues to aggravate Islamabad and cause anxiety in Beijing.

(Courtesy of Mail Today)

August 08, 2018

Diaoyu Islands Dispute: A Chinese Perspective

Image Credit: National Land Image Information (Color Aerial Photographs), Ministry of Land, Infrastructure, Transport and Tourism, Japan

A view from China on the treaties that apply to the territorial dispute between China and Japan.

By Liu Dan

August 08, 2018

There is a longstanding sovereignty dispute concerning the Diaoyu/Senkaku Islands between China and Japan. An “international dispute” is a matter for objective determination: one exists if “there is a disagreement over of point of law or fact, a conflict of legal views of interest” between two parties, as it was stated by the Permanent Court of International Justice in the Mavrommatis Palestine Concessions (Jurisdiction) case (1924). Therefore, a mere denial from the Japanese government that the dispute exists does not prove the nonexistence of the dispute.

China and Japan obviously have contradicting legal positions on the Diaoyu/Senkaku Islands. Previous Chinese literature invokes historical evidence dating to before the Sino-Japanese war to prove China’s sovereignty over the islands. For China, the “fact” that the islands were uninhabited does not mean that Diaoyu Islands were “terra nullius” under international law. Besides the fact that China had already discovered and named the Diaoyu Islands by the 14th-15th century, it is general knowledge that the maritime boundary line between China and the Kingdom of Ryukyu (invaded and then renamed as “Okinawa prefecture” in 1879 by Meiji government of Japan) was in Hei Shui Gou (today’s Okinawa Trough) between Chiwei Yu and Kume Island. The Diaoyu Islands, lying to the west of Hei Shui Gou, were China’s territory, not islands appertaining or belonging to the territory of the Ryukyu Kingdom.

Prior to the 1895 Japanese Cabinet decision that “incorporated” the Diaoyu Islands into Okinawa prefecture, the Diaoyu Islands had long been under the Chinese coastal defense of the Ming (1368-1644) and Qing (1644-1912) dynasties. The Qing court further placed the islands under the jurisdiction of the local government of Taiwan. This can be proved by numerous official documents or maps originating from China, Japan, and the Kingdom of Ryukyu.

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Japan, on the other hand, relies on the theory of territorial acquisition under modern international law to defend its claim. For example, a recent article by Jun Tsuruta in The Diplomat referred to the rule of “effective control” in international law, especially “terra nullius” and “acquiescence,” and concluded that “China’s long postwar silence undermines its claim to sovereignty.” However, according to the Tripartite Hierarchy Rule for territorial disputes, the International Court of Justice (ICJ) looks first to treaty law, then to uti possidetis, and finally to effective control. Treaties in relation to the territorial dispute play a preliminary or even preferential role for international dispute mechanisms in deciding territorial sovereignty.

The 1895 Treaty of Shimonoseki after the Sino-Japanese War is the starting point to examine the applicable treaties concerning the dispute. Japan’s official documents such as Minister Mutsu Munemitsu’s reply to Yasushi Nomura on January 11 of 1895 show that from the time of the fact-finding missions to Diaoyu Islands in 1885 to the occupation of the islands in 1895, Japan had consistently not made its moves to seize the Diaoyu Islands in public, until it defeated the Qing dynasty in the Sino-Japanese war. According to Article 2 (b) of the Treaty of Shimonoseki signed on April 17, 1895, the Qing court was forced to cede “the island of Formosa [Taiwan], together with all islands appertaining or belonging to the said island of Formosa” to Japan. Accordingly, the Diaoyu Islands were ceded to Japan as “islands appertaining or belonging to the island of Formosa.”

Following the Treaty of Shimonoseki, a series of treaties and international instruments after the World War II are the legal basis for China to claim its territorial sovereignty over the Diaoyu Islands. First, the Cairo Declaration of December 1943 proclaimed that “all the territories Japan has stolen from the Chinese, such as Manchuria, Formosa [Taiwan] and the Pescadores, shall be restored to the Republic of China. Japan will also be expelled from all other territories which she has taken by violence and greed.” The Diaoyu Islands, which were secretly stolen by Japan, should be returned to China.

Article 8 of the Potsdam Declaration of July 1945 reaffirms that “The terms of the Cairo Declaration shall be carried out” and the Japanese Instrument of Surrender of September 1945 reflect that the fact that Japan pledged to faithfully fulfill the obligations enshrined in the Potsdam Declaration. Japan’s obligation to return the Diaoyu Islands was further reinforced by these two legal documents.

Moreover, the Supreme Commander for the Allied Powers Instruction (SCAPIN) No. 677 of 1946 defined Japan’s administration power to “include the four main islands of Japan (Hokkaido, Honshu, Kyushu and Shikoku) and the approximately 1,000 smaller adjacent islands, including the Tsushima Islands and the Ryukyu Islands north of the 30th parallel of North Latitude.” The Diaoyu Islands, lying within 25°40′ – 26°00′ of North Latitude, were clearly not included into the regime defined by the SCAPIN No. 677.

Contrary to China’s approach to invoke the Treaty of Shimonoseki and legal documents such as the Cairo Declaration, Japan tends to deny the applicability of the Treaty of Shimonoseki in the dispute. Instead, Japan relies on multilateral treaties such as the 1951 San Francisco Peace Treaty, bilateral treaties such as the 1971 Ryukyu Transferring Agreement (“Agreement concerning the Ryukyu Islands and the Daito Islands with related arrangements,” i.e., the so-called “Okinawa Reversion Agreement”), as well as some decrees issued by the U.S. Ryukyu Administrative Government (which operated from 1950 to 1972).

Although Japan regards relevant provisions of the San Francisco Peace Treaty as the conventional basis for the Diaoyu Islands dispute, the applicability and legality of the Treaty are problematic. First, the negotiation, legislative, and ratification process of the San Francisco Peace Treaty in relation to the post-war arrangement with Japan excluded China and other allies such as the Soviet Union. Therefore, the legality of the San Francisco Peace Treaty as “peace treaty” or post-war arrangement is doubtful, since the said exclusion is a violation of the commitment by the allies to “cooperate with the Governments signatory hereto and not to make a separate armistice or peace with the enemies” which was envisaged in the 1942 Atlantic Charter. Second, according to the general rule of pacta tertiis nec nocent nec prosunt (treaty does not create obligations for a third party) under international law, China is not bound by the San Francisco Peace Treaty because of its status as a third party being excluded from the treaty signature.

Even if the San Francisco Peace Treaty is applicable in determining the dispute, if one examines the treaty provisions from the angles of the law of UN trusteeship and treaty interpretation, the use of terms in Article 3, such as “Nansei Shoto,” “any proposal of the United States to the United Nations to place under its trusteeship system,” and “powers of administration, legislation and jurisdiction” may not necessarily support Japan’s sovereign claims over the Diaoyu Islands.

Referring to the U.S. Civil Administration Proclamation No. 27 of December 1953, Article 1.2 of the “Agreed Minutes” attached to the Ryukyu Transferring Agreement included the Diaoyu Islands into the regime of the “Ryukyu Islands” by geographic coordinates which had been indicated in Proclamation No. 27. However, neither the 1971 Ryukyu Transferring Agreement nor Proclamation No. 27 of 1953 is a solid legal basis for Japan’s claim for several reasons.

First, such inclusion was defined by the form of “Agreed Minutes” instead of “Annex,” which had been required by the Japanese government during the negotiation. The legal form undermines the possibility of applying Article 1.2 of the “Agreed Minutes” in the dispute. Second, the Ryukyu Transferring Agreement violated the general rule of pacta tertiis nec nocent nec prosunt, since the Agreement has the effect of including the disputed territory (the Diaoyu Islands) into the Ryukyu Islands. Third, Proclamation No. 27 of 1953, which neither conforms with SCAPIN No.677, nor abides by the law of military occupation, shall not be regarded as a “legal basis” for the Ryukyu Transferring Agreement.

To maintain its claim, Japan disregards the Treaty of Shimonoseki and treaties signed among allies to maintain world peace and order after World War II. On the other hand, Japan relies heavily on the San Francisco Peace Treaty, the Ryukyu Transferring Agreement, and the decrees of the U.S. Ryukyu Administrative Government. Moreover, rules of territorial acquisition (such as “terra nullius” and “acquiescence”) are quoted frequently by the Japanese government. However, the ICJ normally follows the Tripartite Hierarchy Rule for the territorial dispute; namely, treaties in relation to the territorial dispute — instead of rules of territorial acquisition — will play a preferential role for the Court to examine the dispute. In deciding the Diaoyu/Senkaku Islands dispute, multiple considerations such as treaties and the factor of “critical date” (the point of time falling at the end of a period within which the material facts of a dispute are said to have occurred) are more decisive than acquiescence.

LIU Dan is Associate Research Professor at Koguan Law School, Shanghai Jiao Tong University.

What’s in a name? Cambridge and Oxford Analytica

Oxan .com

Dr David R. Young, Founder & President of Oxford Analytica, explains what's in the name, our Founding Principles, and why they have never been more relevant.

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It was one level of offence for Cambridge Analytica to misuse our name – Oxford Analytica – and tarnish a reputation that has been built up over five decades. And it was another level to misuse the personal details from Facebook of 80 Million people – especially when such offences misuse the “truth”.  

What’s in a Name?’ asked Shakespeare, and at Oxford Analytica we would answer “truth and trust”!

As we have seen first hand, the very idea of “truth” is "in play" today on a global scale.  This is worrying enough, but if ‘truth’ becomes merely a label slapped on an assertion, appropriated by one side to denigrate the other, then we are in trouble.  As the late New York Senator and Harvard professor Pat Moynihan put it, everyone is entitled to their own opinion, but not to their own facts.  Once those with the loudest, or most effective, voices are allowed to define objective truth, our basis for making decisions is fatally compromised.

But an even greater worry is that when truth becomes a  casualty, trust will be next .

A powerful explanation for the significance of truth comes from the English writer John Locke, who died in 1704. On his memorial in the Cathedral in Oxford the following is cut in stone:

I know there is truth opposite to falsehood that it may be found if people will and is worth the seeking

300 years later, on a rainy day in 2004, I was walking through the Cathedral and stopped to read it. It seemed it was written just for me as it reminded me of when I was working on the Founding Principles of Oxford Analytica in 1974: 

“Scholarship is the relentless search for truth and begins with an accurate assessment of human nature.”“Necessary understanding comes from rigorous examination with no cause to promote other than the truth”

Since then “truth” has been central to the vision of Oxford Analytica and we have worked hard to provide the best unbiased and objective analysis on world events available anywhere.

Ten years later, in 1984, the Oxford Analytica Daily Brief was launched and patterned on the President’s Daily Brief – which I had worked on as Henry Kissinger’s assistant in the White House in the early 1970’s. The idea was to harness the intellectual capital of the world’s great universities, to produce the highest quality of objective analysis to help business and government leaders make better decisions and navigate the risks in the global marketplace. And this is what Oxford Analytica has striven to do every weekday for the past 33 years.

It is a simple fact that good decisions depend on how good the analysis is between the event and the decision. And, good analysis leads to trusted analysis - based on truth and produced by individuals who seek it.

The rarest virtue in any power center is trust and it is fundamental that the foundation for trust is truth. Leaders need people and relationships they can trust – and the level of trust reflects the level of truth. But in a society which is slowly losing confidence in everyday truth – trust is also becoming an everyday casualty. If Francis Fukuyama is correct – that “trust” is what has underpinned Western Civilization and made it distinct in the sweep of history – we must ask ourselves: are we losing what made Western Civilization – Western Civilization?

Finally, the name “Analytica” – actually comes from the title of the Chapter on Logic in Aristotle’s Treatises, written in the second century B.C.

And, logic is the way in which information and analysis is used to find truth you can trust - trust that is founded on character that knows that truth "is worth the seeking ." (to quote John Locke again).

David R. YoungFounder & President

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About the author

David R. Young founded Oxford Analytica in 1975 and sits on the Board. Previously, he was a lawyer in New York at Milbank, Tweed, Hadley & McCloy and then Special Assistant to Dr Henry Kissinger during the Nixon presidency.

About David R. Young

August 07, 2018

Cry Havoc! Why the West Needs to Let Slip the Dogs of War in Africa

OPINION - August 6, 2018

By Alex Holstein

The 1980 film The Dogs of War offers a highly realistic depiction of a team of mercenaries (led by none other than Christopher Walken) overthrowing the brutal dictator of the fictional African nation of Zangaro. The film, and the book from which it was adapted, is itself based on author Frederick Forsyth’s own experiences in Africa during the Nigerian Civil War, in which foreign mercenaries played a central role. Almost fifty years since that conflict, and forty since the film, not much has changed in Africa – at least in terms of instability and the suffering that comes with it. In fact, it has probably gotten worse. But today’s threats are far more dangerous to both the continent and the greater global order beyond.

Today’s Africa is home to some of the world’s most violent warzones. Nowhere does chaos currently reign more supreme, particularly as the main refuse point for the blowback out of Western wars in the Middle East. With the collapse of Islamic State strongholds in Iraq and Syria, thousands of al-Qaeda and ISIS fighters have flooded into the continent to link up with jihadist groups and foment conflict across its vast expanse.

Many experts now simply define al-Qaeda and ISIS as nothing more than glorified criminal cartels – but far more dangerous. The DEA reports that jihadists have turned Libya into a major transit hub for both narcotics and human traffic entering the European market, forging ties with major crime syndicates in Italy, the Balkans, Ukraine, and Russia. Approximately 40% of the cocaine reaching Europe each year transits through jihadist turf in Mali, Niger, the Sahara and Libya. ISIS and al-Qaeda made well over $300 million in a single year alone from human-trafficking. Since their expansion into Africa, rhino poaching alone has shot up by over 7000%.  A single rhino horn can fetch $300,000 USD on the black market – enough to arm, feed, and train 75 ISIS fighters for an entire year. And in the chaos of post-Gaddafi Libya, several thousand shoulder-launched surface-to-air missiles, each worth up to $15,000 USD on the black market and able to bring down a commercial airliner, still remain unaccounted for. No one is searching for them.

The United States has committed an entire military command, AFRICOM, to the region, and deployed large numbers of special operations forces and drones to engage the terrorists head-on. In terms of tactical aggression and operational tempo, they are right where they should be.  However, defeating today’s terrorists – particularly in Africa – will require a far more dexterous approach than the standard counterinsurgency doctrine might prescribe. One that can apply special operations skill sets to tactically counter the paramilitary threat of the modern jihadists, while simultaneously addressing greater strategic issues.

In The Dogs of War, Simon Endean, the man who hires Walken’s team of mercs, asks: Could a small mercenary force overthrow the main target of the coup, a psychopathic dictator called Kimba?  Endean is asking for a surgical approach. He doesn’t simply wish to remove the head of the snake. He wants to remove a tumor from the head of that snake and gain control of the snake itself. Walken and his crew are to be the scalpel.  Well—spoiler alert—although Walken, playing the angrily reluctant hero, throws Endean out of his dreary New York bolt-hole where he keeps a pistol in the fridge, the answer is simply: Yes. And they do. With maximum caution and extreme prejudice.

Now, in today’s world, it isn’t necessarily a dictator that needs overthrowing. In fact, we’ve overthrown a couple in the last fifteen years, albeit using hammers rather than scalpels, one of which was in Libya, and – well, as Dr. Phil might ask in a moment like this with his Texas twang: “How’s that workin for ya?”

But the question remains: Could a small mercenary force, our own scalpel, or perhaps – since it is the 21st century, after all – a surgical laser, cut out a tumor that is fast-metastasizing across Africa?

And if so, how?

How do you take down a paramilitary terrorist organization whose various groups collectively comprise a vast criminal conspiracy as well as a geopolitical threat that rivals even powerful state actors?

By recognizing what feeds that beast.

Not terror itself, which is retail, but the crime that funds it.

Terrorists engaging in criminal activity is nothing new. Hezbollah, Iran’s main terrorist proxy, smuggles cigarettes into Canada, moves stolen cars out of the U.S., and runs Lebanese blonde hashish and high-grade smack out of their own backyard in the Bekaa Valley. For over two decades, the Taliban have supplied most of the heroin that Europeans shoot into their veins.

But it is al-Qaeda and ISIS who rely on crime more than any other group to fund their terrorist operations, building a criminal empire on par with that of the Mexican drug cartels, Russian mob, or Italian mafia.  For both terror groups, crime is merely a means to an end – that end being the establishment of a global caliphate under the black banner of Salafist Islam – which can only be achieved through war. Indeed, in its own online propaganda publication, Rumiyah, ISIS has stated that conflict zones such as Syria and Ukraine offer the perfect opportunity to forge ties with the criminal underworld.

While both groups maintain a significant network of private donors across the Muslim world, particularly in Saudi Arabia and the Gulf States, crime has proven a far more consistently lucrative source of funding – with human-trafficking, drug-smuggling, gun-running, and animal-poaching being the four top-earners, especially in their latest favorite playground – Africa.

ISIS seems to have a natural proclivity for crime. The group encourages its Western recruits to engage in street-level crime to raise small-scale operational and logistical funds – drug-dealing, theft, credit card fraud – anything that might pay for a plane ticket to Iraq, Syria, or now, more so, Africa. And ISIS not only encourages drug-dealing, but drug-use as well. ISIS fighters in Iraq, Syria, Libya and Nigeria are known to take so-called “jihad pills,” mainly Captagon and tramadol, to stay amped up on the battlefield, as they engage in ferocious combat with their sworn enemies, a habit they may have inherited from the fierce Chechen fighters who initially trained them, and were also known to get jacked on amphetamine-type stimulants to better take Western bullets and stay combat-capable.

Qaeda itself, having further fractured and decentralized into a franchise-like structure of affiliates, has engaged more aggressively in large-scale criminal enterprise, nowhere more so than in the Sahel region of Africa, where whole swathes of ungoverned space and lawless lands offer plenty of opportunity for illicit gain. Mokhtar Belmokhtar, a former top commander of al-Qaeda in the Islamic Maghreb (AQIM), believed killed in Libya, was, according to French criminologist Alain Bauer, “a classic case in point of hybrid terror-criminality.” According to Bauer, Belmokhtar was “…99-percent criminal and 1-percent jihadi.”

His one-time brother-in-arms, Adnan al-Sahrawi, now leader of AQIM’s main regional rival, the Islamic State in the Greater Sahara (ISGS) – which announced its existence with the October 2017 killing of four American special operations soldiers in Niger – is considered a major drug kingpin whose followers actually boast of his criminal prowess. Sahrawi has diversified big-time into human-trafficking, moving unwitting African migrants through Mali into Niger, and then on to Libya, where they are at the mercy of their smugglers, who often auction off the women and children into sex slavery alongside Yazidis out of Iraq. The rest are packed into rickety old boats for the perilous voyage across the Med – sometimes with ISIS infiltrators among them.  According to the Guardian, Interpol has identified 50 foreign fighters who have come into Italy from Libya disguised as migrants to launch new attacks across Europe.

The real migrants pay $300-$400 USD per head for the journey. They also pay in other ways, with ISIS using them as pack mules, forcing them to transport South American cocaine along the same route into Libya, where it is then shipped into Italy via the notorious Port of Gioia Tauro, run by the dreaded ‘Ndrangheta. According to Italy’s anti-drug-trafficking agency, the DCSA, 80 percent of the cocaine consumed in Europe comes through this port. That’s 48 tons of cocaine worth approximately $1.8 billion every year. No surprise then, considering its links to terrorism, that Gioia Tauro also happens to be a main transshipment point for illegal weapons – most of them also out of Libya. The RAND Corporation believes that ISIS shot callers there have developed a strong business relationship with both the ‘Ndrangheta and the Neopolitan Camorra.

With a monopoly on the key smuggling routes through the Sahel, both AQIM and ISGS maintain direct ties to representatives of the Colombian drug cartels stationed in the thoroughly corrupt state of Guinea-Bissau, where they have been welcomed with both open arms and wallets. It is this relationship between narco and jihadist that offers the perfect example of the hybridization between the criminal underworld and terrorism. And also the vicious cycle between their four main sources of funding. From Guinea-Bissau, AQIM and ISGS transport South American cocaine through West Africa and then up through the Sahel – from Senegal to Mali to Niger, then Niger to Libya. For this, they receive 50-percent of the profits – a hefty sum. Hefty enough that in 2013, AQIM was able to use that cash to purchase AKs, surface-to-air missiles, and armored personnel carriers from soldiers fleeing Libya after the collapse of the Gaddafi regime.  The jihadists used the weapons – some of which had been supplied by NATO countries after Gaddafi renounced his WMD program – to prosecute their insurgency in Mali, nearly overrunning the capital, Bamako, before France deployed over 4,000 troops to stop them. The group lost most of its gains in terms of occupied territory, but it was a close-run thing.

The trade in illegal wildlife, particularly rhino horns, is lucrative enough that the Islamic State has actively targeted counter-poaching forces for death. In one case, police arrested a group of poachers in South Africa who had a shoulder-fired missile in their possession that authorities later traced to a U.S. military stockpile that had fallen into ISIS’s hands after they took over Mosul. Intelligence officials believe that they sent the weapon to South Africa to shoot down a helicopter being used by a group called Rhino 911 to interdict their rhino-poaching efforts.

Apart from the monetary gains, both Qaeda and ISIS – like the Taliban and Hezbollah – understand the greater political benefits of profiting off of their enemy’s misery and degradation. The Taliban for decades has made a fortune as Europe’s number one supplier of heroin – using the revenue to fund their insurgency in Afghanistan, while creating addicts, fomenting crime, and undermining whole communities in the West. ISIS has adopted a similar model, issuing a fatwa allowing affiliates like ISGS to poison non-believers en masse.

ISIS has used the sex slave trade as part of its ethnic cleansing program to devastate the Yazidi people of Iraq, smuggling Yazidi women and girls into Libya to be auctioned off there or smuggled into Europe as sex slaves. ISIS uses the promise of sex slaves, many of them Yazidi, to entice young men from across the globe to join the fight in Iraq and Syria.  The brutal Boko Haram, ISIS’s affiliate in Nigeria, has kidnapped thousands of girls, using them as cooks, sex slaves, and even suicide bombers. Like ISIS in Iraq and Syria, Boko Haramalso uses the promise of sex slaves as a recruitment tool, and maintains “rape camps” where they purposely impregnate their victims to produce “the next generation of fighters.” Sexual slavery is not only a means of profit for jihadists, but one of their most potent weapons against local populations.

ISIS and Qaeda may be on the run in Syria and Iraq, but they are still metastasizing in Africa and still trading in guns, drugs, animal parts, and innocent human beings that finance their cause.  Bauer argues that recognizing the hybrid nature of the threat – between terrorist and criminal, and the funding sources – is the key to crushing it.

This is where our own team of mercs can come in, or multiple teams of them.  Not just war-fighters alone, but elite teams of former U.S. and foreign intelligence and law enforcement officers, military veterans, and special operators.  People with African experience who can work more flexibly than official military forces with indigenous elements to identify and cutoff the key choke points – not only fighting on the frontlines to take down the terrorists on their own turf, but connecting the dots to unmask the shadowy networks that deal in the drugs, guns, poaching and human traffic that finance their activities. The mission: to cut the terrorists off at the ankles by cutting off their main sources of funding.

Just as we have witnessed a hybridization of crime and terror in modern jihadism, so, too, must we counter this threat with a hybridization of our own forces – an all-star “Justice League-like” force of former crime-fighters and counter-terrorists who can engage this vicious enemy both tactically and strategically. Who can go from taking down a drug or slave-trade transit point with force, to employing criminal-forensic investigative techniques, or engaging in proactive human-intelligence-gathering and psychological operations, to coordinating further takedowns on a much wider scale.  And, as mercenaries, who will not be bound by the restrictive politics, bureaucracy, and internecine rivalries that all too often undermine real-time adaptability, and blunt the surgical instruments meant to cut out the worst kind of cancers.


The opinions, beliefs, and viewpoints expressed by the authors are theirs alone and don’t reflect the official position of or any other institution.

August 06, 2018

Chinese and Russian Defense Innovation, with American Characteristics? Military Innovation, Commercial Technologies, and Great Power Competition

Chinese and Russian Defense Innovation, with American Characteristics? Military Innovation, Commercial Technologies, and Great Power Competition

Strategy Bridge 

 August 2, 2018

Samuel Bendett and Elsa B. Kania

As great power rivalries intensify, China, Russia, and the United States are redoubling their pursuit of defense innovation in emerging technologies that could change the character, perhaps even the nature, of warfare. At present, U.S. primacy in innovation remains a critical, though contested, advantage. China is emerging as a scientific and technological powerhouse, while Russia is creatively pursuing asymmetric advantages. Since advances in these dual-use technologies, including robotics and artificial intelligence (AI), are emerging increasingly from the private sector, the capacity to integrate and leverage commercial technologies will be critical in this race for advantage.

Historically, the U.S. has leveraged close relationships between defense, academia, and the private sector, and the Department of Defense has recently expanded and intensified its efforts to build bridges in an effort to introduce the technologies of Silicon Valley into the military. Despite a robust history of partnership—and the successes of the Defense Innovation Unit Experimental (DIUx)—this relationship can also be tense and rocky at times. The recent backlash against Google’s work with Project Maven, which resulted in a campaign by employeesdemanding a policy against building “warfare technology,” culminated in Google’s decision not to renew the contract. Google has since issued principles that included a commitment not to pursue applications of in weapons using artificial intelligence.[1] Given the intensity of concerns over the weaponization of artificial intelligence, these debates will likely persist.

Google Employees Petition Against Project Maven (sUAS News)

At the same time, China and Russia are redoubling their own initiatives to deepen relationships among the defense establishment and commercial enterprises, adopting and adapting elements of the traditional U.S. approach in the process. There will be major asymmetries and divergences in the context for and character of such partnerships. The free, open debates taking place at Google reflect a major strength of the U.S. innovation ecosystem—that dissent and discussion unlikely to be tolerated in China or Russia are encouraged, creating an environment conducive to risk-taking and creativity. At the same time, appeals to Googlers to consider shared interests with the U.S. military and concerns over U.S. national security, confront the reality that this notionally U.S. company and its workforce are highly international, whereas tech companies in China and Russia, even those that are not directly state-owned or controlled, operate under greater constraintswith lesser transparency, while often leveraged as national champions. The apparent absence of the freedom to debate and dissent can have negative consequences for innovation, but patriotism and nationalism can also be powerful motivations in countries that aim to catch up with, and eventually overtake the U.S. military.

The capacity of states to promote and facilitate closer collaboration among defense and commercial sectors can be advantageous in the development of dual-use technologies. To advance military innovation, Xi Jinping has called for China to follow “the road of military-civil fusion-style innovation,” such that military innovation is integrated into China's national innovation system. Within the past several years, the concept of military-civil fusion (军民融合) has been elevated to the level of national strategy, guided by the Central Military-Civil Fusion Development Commission (中央军民融合发展委员会), established in January 2017 under the leadership of Xi Jinping himself. This focus on leveraging synergies between defense and commercial developments is recognized as particularly effective in the context of dual-use emerging technologies, especially artificial intelligence.

Xi Jinping speaks at a press conference at the Great Hall of the People in Beijing. (How Hwee Young/Wall Street Journal)

Similarly, President Putin has also repeatedly called for technological innovation to modernize Russia's military forces. Accordingly, the Ministry of Defense is seeking to organize various defense and civilian efforts into a breakthrough collaborative model, encompassing research and development departments at military institutions, civilian universities, and private sector companies. Moreover, the Russian Minister of Defense has Putin’s ear when it comes to military innovation and modernization, which serves to greatly facilitate the discussion on the most pressing military needs and challenges.

It seems unlikely that moral and ethical considerations will emerge as a major factor impacting or constraining the engagement of Chinese and Russian academics and enterprises in the pursuit of military applications of artificial intelligence. Of course, individual academics and researchers may express their concern and opposition, but open debate or mobilization that reaches a certain threshold would likely be censored, constrained, or redirected by official authorities. For instance, the Chinese government, which articulated its support for a ban on the use of fully autonomous lethal weapons systems during the last session of the UN Group of Government Experts on the topic, will likely to maintain a degree of strategic ambiguity on its position, without constraining its own development of comparable capabilities. At the same time, the Chinese government seeks to lead in developing legal and ethical frameworks, as well as technical standards, to enhance its influence in the future development and governance of artificial intelligence. For Russia, pragmatism, not ethics as the West understands it, comes first. The Russian position with respect to developing weapons armed with AI is best exemplified by its official stance on Lethal Autonomous Weapons Systems, which calls for a human in the decision-making loop but does not endorse the notion of an international regime that would limit the sovereign right of nations to build and test new technologies. The Russian defense establishment is therefore taking a results-driven, forward-looking approach to the development of artificial intelligence.

As China and Russia seek to keep pace with and overtake U.S. defense innovation initiatives, their approaches are mimicking, perhaps even copycatting, and converging with certain elements of the traditional U.S. approach. There are a growing number of partnerships and collaborations between their respective defense establishments, academic institutions, and commercial enterprises. Notably, Chinese and Russian would-be-DARPAs are now seeking to act as catalysts for disruptive innovation. Adapting the model of DIUx, China and Russia are also establishing new mechanisms to enable the rapid incorporation of commercial technologies for defense purposes, and vice versa. For example, Russia recently announced the creation of a company that aims to take military achievements in artificial intelligence, blockchain, machine learning and Big Data analysis and push them to the civilian sector to counter domestic dependence on imported Western hi-tech. The future trajectory of these initiatives remains to be seen, but such efforts may yield results unexpected from countries that lack the tradition of American-style military-technical innovation. If successful, these overtures towards Chinese and Russian defense innovation with American characteristics could enhance their respective capabilities to experiment with and operationalize new capabilities.


DARPA’s success has inspired the creation of would-be imitators in China and Russia that are similarly intended to catalyze advances in defense science and technology. In late 2012, Russian presidential decree launched the Russian equivalent of DARPA, the Foundation for Advanced Studies (Фонд перспективных исследований ), which has a mission similar to its American counterpart. The purpose of the Foundation is to “promote the implementation of scientific research and development in the interests of national defense and state security associated with a high risk of achieving qualitatively new results in the military-technical and socio-economic spheres, developing and creating innovative technologies and manufacturing special and dual purpose products.” Although much smaller than its American counterpart, it nonetheless conducts an impressive research and development portfolio of promising and emerging technologies, including artificial intelligence and autonomous systems.

Russian Minister of Defence Sergei Shoigu and President Vladimir Putin attend a presentation on the Era military innovation technopolis in the Kremlin's St. Andrew Hall. (President of Russia)

The Russians have also borrowed a page from their Soviet history by launching a massive project to build a science and technology city—the Era innovation technopolis, which will be constructed on the Black Sea Coast and host military and civilian researchers, some of which are from private sector companies, living and working together on a variety of projects, including AI and robotics. Russia also has a Military-Industrial Commission that has been operating for years at this point, with a mission to “implement state policy concerning the military-industrial complex, military technology provision for the nation’s defense, state security and law enforcement.”

Pursuant to its ongoing military reforms and reorganization, the Chinese People’s Liberation Army (PLA) has created a new institutional framework to advance defense science and technology development. The Central Military Commission (CMC) Military Scientific Research Guidance Commission (军委军事科学研究指导委员会) has been created to exercise high-level leadership on technological innovation, while also seeking to facilitate military-civil fusion in science and technology. Concurrently, and likely under its guidance, the Central Military Commission Science and Technology Commission (军委科学技术委员会), has been elevated from the former General Armaments Department’s Science and Technology Commission. The Commission, with Lieutenant General Liu Guozhi (刘国治) as its director, is directed to advance the Army's pursuit of a strategy of innovation-driven development, promoting advances in defense science and technology, including through convening expert groups of prominent scientists. In March 2018, China’s first “defense science and technology innovation rapid response small group” (国防科技创新快速响应小组) was launched by the Central Military Commission Science and Technology Commission in Shenzhen. The establishment of this new mechanism is intended to “promote the integration of military and civilian developments in the domain of science and technology, and to use advanced commercial technologies to serve the military.” This first team will leverage “the innovation advantages of the Shenzhen Special Economic Zone to rapidly respond to the needs of national defense science and technology innovation through various forms and accumulate experience in promoting the formation of a flexible and highly efficient defense technology innovation value chain.” The priority fields highlighted for this program include artificial intelligence, biology, networking, materials, manufacturing, and oceanography.

Chinese President Xi Jinping, also the chairman of the Central Military Commission, presents the heads of the People's Liberation Army Academy of Military Science with the military flag in 2017. (Li Gang/Xinhua)


In 2018, China and Russia have each launched competitions and challenges that seek to engage a range of participants to advance the development of military robotics and artificial intelligence technologies. Going forward, these events are likely to increase number and complexity, perhaps attracting more and more promising talent and technologies.

Within the People's Liberation Army, several services have started to experiment with challenges that are intended to mobilize teams of academic and defense researchers to compete in development. In the fall of 2016, the Army organized a contest involving unmanned ground vehicles, required to engage in tasks such as battlefield reconnaissance. This spring, the People's Liberation Army Air Force announced an upcoming competition. This “Unmanned Warfront” Intelligent UAV Swarm System Challenge ("无人争锋”智能无人机集群系统挑战赛) is open to not only military scientific research institutes but also universities, private enterprises, and even drone enthusiasts. The technology of the winning participants, who will compete with fully autonomous swarms to undertake tasks including cooperative reconnaissance and target identification, will be given priority for future Air Force projects.

The Russian Ministry of Defense is hosting a competition among designers of robotics technologies, who will present projects involving unmanned aviation, autonomous transport, and AI applications, including big data, machine vision, and machine learning. The participants will include small innovative enterprises, design bureaus, individual inventors, and young scientists and students, as well as employees from Russian military’s scientific companies. The winning designs, selected by experts from the Ministry of Defense's Main Directorate for Scientific Research and Technological Support of Advanced Technologies, will be presented at the annual Army-2018 military technology forum in August, the biggest event of its kind in the Russian Federation. This November, there will also be events among students from Russian civilian and military academies and universities that will involve unmanned underwater vehicle challenge and an unmanned ground vehicle biathlon. The goal for these efforts is obvious—identify promising talent and attract students to the rapidly burgeoning world of military robotics.


To facilitate greater collaboration, China and Russia are creating new platforms and facilitating new partnerships that could prove effective in integrating future development.

In China, military-civil fusion is advanced through a range of expos, parks, funds, projects, and joint laboratories that are emerging nationwide, often involving leading companies and universities. Baidu is partnering with the China Electronics Technology Group (CETC), a state-owned defense conglomerate, through the Joint Laboratory for Intelligent Command and Control Technologies (智能指挥控制技术联合实验室), to pursue applications of big data, cloud computing, and artificial intelligence in military command information systems. Tsinghua University, often characterized as China’s MIT, islaunching the Military-Civil Fusion National Defense Peak Technologies Laboratory in Beijing to create a platform for the pursuit of dual-use applications of emerging technologies, particularly artificial intelligence. In addition, Tsinghua is buildinga “High-End Laboratory for Military Intelligence” (军事智能高端实验室) with the support of the Central Military Commission Science and Technology Commission.

The Beijing Academy of Quantum Information Science was established as a collaboration among the Beijing Municipal Government, Chinese Academy of Sciences, Academy of Military Sciences, Peking University, and Tsinghua University, Beijing University of Aeronautics and Astronautics to advance the development of dual-use quantum technologies. There is a new base in Qingdao for the development of dual-use intelligent/autonomous underwater vehicles.

Russian Defense Minister Sergei Shoigu

In Russia, there is progress towards developing a framework to coordinate and implement artificial intelligence development. One major forum on “AI: Problems and Solutions ” in March 2018, organized by the Ministry of Defense, Ministry of Education, and the Russian Academy of Sciences, discussed current domestic developments in artificial intelligence and reviewed international achievements in that field. The event was intended to develop proposals to target the orientation of the Russian state and scientific community on the issues and tasks of creating artificial intelligence. In fact, Defense Minister Sergei Shoigu called for the civilian and military designers to join efforts to develop artificial intelligence technologies, which is necessary to “counter possible threats in the field of technological and economic security of Russia.” Perhaps the most significant result to date from this effort is the publication of what appears to be the roadmap for developing military artificial intelligence—under the auspices of the Ministry of Defense, the Russian Academy of Sciences, and other government and academic institutions. This roadmap spells out key public-private cooperation efforts aimed at fostering greater domestic development, education and research and development in artificial intelligence. One such effort is the proposal to create a National Center for Artificial Intelligence under the auspices of the Russian Academy of Sciences and the Foundation for Advanced Studies. There are also examples of public-private cooperation that are already in the implementation stages across the country, such as the effort by the team led by the National Research Nuclear University that is developing artificial intelligence technology called Virtual Actor, designed to have situational and emotional intelligence. In addition, a joint project between the University of Information Technologies, Mechanics and Optics (ITMO - St. Petersburg) and the Far Eastern Federal University (Vladivostok) is also working on developing artificial intelligence, focusing on the use of neural networks for the management of nuclear power plant systems.


Looking forward, there are reasons for the U.S. to be confident about its unique and enduring advantages in defense innovation. The Department of Defense is actively enhancing its capability to leverage emerging technologies in which U.S. enterprises remain leaders. However, the U.S. Third Offset strategy has acted as an impetus and inspiration for Chinese and Russian efforts to offset the offset through pursuing their own agenda and advances in a number of the same emerging technologies. In the process, China and Russia are exploring their own models for deeper collaboration in innovation that may enhance their capability to leverage critical commercial technologies. Their efforts may be facilitated in this case by what appear to be nationwide efforts to marshall the best academic, industrial, and high-tech resources into a single, unified effort, often seemingly unimpeded by legal, ethical, political or socio-cultural dynamics and considerations, such as the debates at UN Group of Governmental Experts or recent controversies about the military employment of artificial intelligence.


While such top-down management may appear less flexible when compared to the American approach, it may also have certain strengths in facilitating deeper integration than is possible in the U.S. system and political economy. While Russia and China are known for their lumbering civilian and military bureaucracies, both nations are nonetheless demonstrating that they can be nimble enough to accelerate certain technological developments, along with testing and evaluation. So far, both competitors have proven that they can take specific American elements and apply them to their own unique ecosystems. Nonetheless, using American-style institutional and procedural concepts is still a novel idea for the top-heavy ministries tasked with such breakthrough technological developments in both countries. Looking forward, while the United States still has a significant advantage in emerging technologies and their applications, Russian and Chinese efforts could nonetheless produce results that may yet disrupt today’s techno-strategic competition among these great powers.

Samuel Bendett is a Research Analyst with the Center for Naval Analyses' International Affairs Group, where he is a member of the Russia Studies Program. He is also affiliated with the American Foreign Policy Council where he is a Fellow in Russia Studies. Elsa B. Kania is aFeatured Contributor on The Strategy Bridge and an Adjunct Fellow with the Technology and National Security Program at the Center for a New American Security, where she focuses on Chinese defense innovation in emerging technologies. The views expressed in this article are those of the authors and do not represent the official position of the Department of the Navy, the Department of Defense, or the U.S. Government.

Bailing out Pakistan

nese Invasion of Pakistan Illustration by Greg Groesch/The Washington Times more >

Bailing out Pakistan

By Jed Babbin - - Sunday, July 29, 2018


Nuclear-armed Pakistan is not a model of stability. It just elected a new prime minister after a campaign that featured widespread violence and election day bombings. The apparent loser has alleged vote-rigging in favor of his opponent, who was supported by the omnipresent Pakistani army.

That’s one half of the context in which the International Monetary Fund (IMF) will soon consider another financial bailout for Pakistan, which has benefited from a dozen of them since the 1980s.

The other half is the fact that Pakistan’s economy is in shambles due to large-scale corruption and a growing debt crisis. The money it owes other nations and non-Pakistani entities is more than 30 percent of its GDP partly because of the extensive loans it has received from China to build parts of CPEC, the China-Pakistan Economic Corridor, by which China is building roads, power plants, railroads and military bases in Pakistan.

Pakistan needs about another $3 billion in the next few months to avoid defaulting on loans from the IMF, the World Bank and China. The IMF will almost certainly bail Pakistan out of its financial troubles again. But should it? There are two reasons that weigh heavily against such an action.

The first is Pakistan’s continuing support of a variety of terrorist networks through its infamous Inter Service Intelligence agency, ISI. Among the terrorist groups Pakistan supports are al Qadea, the Taliban (also supported by Russia and China) and Lashkar-e-Taiba, which massacred more than 160 people in Mumbai, India, in 2008. Osama bin Laden hid for years in Abbottabad, Pakistan. It’s inconceivable that ISI wasn’t responsible for his concealment.

The Trump administration has terminated military aid to Pakistan because it refuses to cease supporting terrorist networks with money, fighters and intelligence information. But there is no action we, or any other nation, can take to stop Pakistan’s religiously-based support for terrorism. Why, then, shouldn’t we block another IMF bailout?

The second reason not to bail out Pakistan is China’s growing de facto colonization of Pakistan through CPEC. According to a Wall Street Journal report, China is investing about $62 billion in Pakistan to build infrastructure projects. Three years into the program, according to that report, about half of the CPEC planned projects have begun.

China is conducting what some call “debt trap diplomacy,” through which Pakistanis becoming so indebted to China that it will be compelled to follow China’s policies in Southwest Asia and beyond. In fact, the debt trap has already been sprung with the eager assistance of the Pakistan’s government, ISI and army.

Gwadar is a large Pakistani city on the Arabian Sea. Chinese officials have demanded that much of the nearby population be moved away for security reasons and to make room for thousands of Chinese military and civilian people being brought in to construct large port facilities and eventually transform Gwadar into a Chinese naval base.


‘Q,’ followers gain prominence at Trump rallies: ‘All of us are looking for truth’

Pakistan’s government — dependent on its army for whatever level of stability it can achieve — will not suffer de facto colonization gladly. Despite Pakistan’s support of terrorism, China’s corrupting largesse will be able to satisfy the Pakistani army and ISI sufficiently to quell any thoughts of rebellion.

In June, Defense Secretary James Mattis said of China, “The Ming Dynasty appears to be their model, albeit in a more muscular manner, demanding other nations become tribute states, kowtowing to Beijing.”

Another IMF bailout for Pakistan would be a Western contribution to China’s transformation of Pakistan into a tribute state. In these circumstances, the United States — the largest contributor to IMF — needs to voice its opposition to another bailout of Pakistan and try to prevent it. We probably can’t prevent it, but we certainly need to try. We have some leverage.

According to a 2016 report by the Congressional Budget Office, U.S. obligations to the IMF were then $164 billion. But, as the CBO reported, it is very difficult to account for the actual costs we incur. Nevertheless, as the CBO wrote, because of the risk of defaulted loans U.S. contributions to IMF are at risk.

Some will argue that denying Pakistananother IMF bailout would force it to borrow more from China, accelerating its dependence on Chinese largesse and power. Unfortunately, that dependence is already established and whether IMFgrants another bailout or not won’t change that.

Instead, denying another IMF bailout would make Pakistan’s subservience more obvious to the Pakistani population and government. The attendant embarrassment to Pakistan could create friction between it and China, which is sufficient reason for another IMF bailout to be blocked.

Pakistan’s immediate importance to us is the logistics route it has provided for supply our and our allies’ forces in Afghanistan. China’s power over Pakistanmay cause future closures. Thus, our policy toward China has to factor in the war in Afghanistan. India, which borders both Pakistan and China, is the key.

But our policy toward China is unclear. President Trump’s accelerating tariff war won’t turn it into a fair trader, far less an ally. It would be far better for the president to speak out on the dangers of China’s de facto colonization of Pakistanand other nations.

If such action were coupled with a clear embrace of India, comprised of a new trade agreement and the beginning of a defense alliance, the president’s policy could help contain China’s ambitions.

• Jed Babbin, a deputy undersecretary of defense in the George H.W. Bush administration, is the author of “In the Words of Our Enemies.”

August 05, 2018

Australia: Espionage, foreign interference and foreign influence

On 28 June 2018, the Australian Parliament passed a comprehensive package of legislative reforms, including legislation to:

enhance existing espionage, secrecy, treason, sabotage and related offencesintroduce new offences targeting foreign interference and economic espionageestablish a Foreign Influence Transparency Scheme.

Espionage and foreign interference laws

The National Security Legislation Amendment (Espionage and Foreign Interference) Act 2018:

strengthens existing espionage offencesintroduces new foreign interference offences targeting covert, deceptive or threatening actions by foreign actors who intend to influence Australia's democratic or government processes or to harm Australiareforms the Commonwealth's secrecy offences, ensuring they appropriately criminalise leaks of harmful information while also protecting freedom of speechintroduces comprehensive new sabotage offences that effectively protect critical infrastructure in the modern environmentmodernises and reforms offences against government, including treason, to better protect Australia's defence and democracyintroduces a new theft of trade secrets offence to protect Australia from economic espionage by foreign government principalsintroduces a new aggravated offence for providing false and misleading information in the context of security clearance processesensures law enforcement agencies have access to telecommunications interception powers to investigate these serious offences.

Foreign Influence Transparency Scheme

The Foreign Influence Transparency Scheme Act 2018provides the public and government decision-makers visibility of the nature, level and extent of foreign influence on Australia's government and political process. The scheme will introduce registration obligations for persons and entities who have certain arrangements with, or undertake certain activities on behalf of, foreign principals. The scheme provides visibility of the nature and extent of foreign influence over Australia's government and political processes.

The Foreign Influence Transparency Scheme will commence within 12 months of the Bill receiving the Royal Assent (on 29 June 2018) unless proclaimed earlier. Rules will be made under the Act to set the form and manner in which registrants must apply. The government will publicise further details of the scheme and its commencement in due course.

A foreign principal includes:

a foreign governmenta foreign government related entitya foreign political organisationa foreign government related individual.

Categories of registrable activities include:

parliamentary lobbying on behalf of a foreign governmentparliamentary lobbying on behalf of other kinds of foreign principals for the purpose of political or governmental influencegeneral political lobbying for the purpose of political or governmental influencecommunications activities for the purpose of political or government influencedisbursement activities for the purpose of political or governmental influenceemployment or activities of recent Cabinet ministers, recent ministers, recent members of Parliament or recent senior Commonwealth public officials in the period immediately following their public role.

Under the scheme, registrants will be required to disclose information about the nature of their relationship with a foreign principal, and activities undertaken pursuant to that relationship (both at the initial point of registration and on an ongoing basis for the duration of the relationship).

The scheme also:

establishes exemptions, including for diplomatic and consular activities, activities related to the provision of legal advice or representation, religious activities, a ctivities of registered charities, activities related to the arts and activities for the purposes of providing humanitarian aidestablishes a process for the Secretary of the department to issue a transparency notice if the Secretary is satisfied that a person is a foreign government related entity or a foreign government related individualcontains criminal offences ranging from failing to comply with obligations under the scheme, through to failing to register in circumstances where a person is required to do soprovides that some information will be made publicly available to achieve the transparency objectives of the scheme.​​​

Espionage, foreign interference and foreign influence

Currently selected

Media releases

Australia’s national security greatly enhanced with new laws - 28 June 2018


National Security Legislation Amendment (Espionage and Foreign Interference) Act 2018

Foreign Influence Transparency Scheme Act 2018

Related websites

Review of the National Security Legislation Amendment (Espionage and Foreign Interference) Bill 2017

Review of the Foreign Influence Transparency Scheme Bill 2017




How the Australian intelligence community works

Malcolm Turnbull has put Peter Dutton at the head of the Home Affairs super portfolio. AAP/Glenn Hunt

May 10, 2018 6.26am AEST

 John Blaxland, Australian National University

This article is the first in a five-part series exploring Australian national security in the digital age.

National security, intelligence and espionage have been in the headlines due to events abroad and significant developments at home. News of diplomatic expulsionscyber-attacksleaked documents about sweeping new surveillance powers and the creation of a new Home Affairs Departmentmake it hard to follow.

What’s more, everyone has heard of the CIA, for instance, but Australia’s own national security organisations are comparatively unknown. So how is intelligence gathered? What are Australia’s peak national security bodies and how do they interact?

Australia’s national security architecture consists of a number of federal government departments and agencies, with links to state government counterparts. These include the state police forces and counter-terrorism authorities. Those arrangements are in transition, the full details of which are still to unfold.

The major players

The peak national security body in the Commonwealth is the National Security Committee of Cabinet (NSC). It includes the ministers of the principal departments concerned with national security, including the Departments of Defence, Home Affairs, Foreign Affairs and Trade, the Attorney-General, Prime Minister and Cabinet, and Treasury.

Several of the ministers on the NSC oversee a range of national security bodies. These have emerged as a result of trial and error, royal commissions and various reforms over several decades.

For starters, the defence portfolio includes a range of military intelligence units. There are hundreds of uniformed intelligence practitioners across the nation in the navy, air force and army, as well as in the Headquarters Joint Operations Command in Canberra. It also includes three of the nation’s principal intelligence agencies (with a mix of civilian and military intelligence practitioners):

• the Defence Intelligence Organisation (DIO), defence’s principal intelligence assessment agency

• the Australian Geospatial Intelligence Organisation (AGO), responsible for satellite and aerial imagery intelligence, maps, nautical charts and related geo-spatial products

• the Australian Signals Directorate (ASD), responsible for the collection and processing of signals intelligence (essentially, eavesdropping on radio and electronic transmissions).

ASD’s motto, “to reveal their secrets and protect our own”, captures the essence of its functions, which have been the subject of recent controversy after leaked documents proposed giving the ASD domestic surveillance powers.

German Defence Minister Ursula von der Leyen greets Prime Minister Malcolm Turnbull and Defence Minister Marise Payne with a guard of honour. Arne Immanuel Bänsch/DPA

The antecedents of these defence agencies date back to the intelligence organisations established, alongside their American and British counterparts, during the second world war. The ties to that era have endured in the so-called “Five Eyes” intelligence arrangement.

Initially focused on signals intelligence (the principal remit of ASD), Five Eyes is a trusted network between the US, Britain, Australia and the two other predominantly English-speaking allies from that era, Canada and New Zealand.

The title was a derivative of the stamp used to restrict the dissemination of sensitive intelligence to a particular classification: “SECRET – AUS/CAN/NZ/UK/US EYES ONLY” – hence Five Eyes.

Nowadays, the network extends beyond signals intelligence and defence circles to include a broader range of departments, including the Department of Foreign Affairs and Trade (DFAT).

DFAT is Australia’s principal agency tasked with “promoting and protecting our interests internationally and contributing to global stability and economic growth”. As part of that role, it is responsible for diplomatic reporting. Much of the information Australia gathers from counterpart governments abroad is collected openly, but discreetly, by Australia’s diplomats.

In addition, the Australian Secret Intelligence Service (ASIS) is in the foreign minister’s portfolio. Established in 1952 and tasked with the collection overseas of secret intelligence, the ASIS mission is listed as being “to protect and promote Australia’s vital interests through the provision of unique foreign intelligence services as directed by the Australian Government”. This is otherwise known as human intelligence collection or, in traditional terms, foreign espionage.

Countering foreign espionage (particularly from Soviet, later Russian and other countries operating in Australia) is the remit of the Australian Security Intelligence Organisation (ASIO). Established in 1949, ASIO has been part of the attorney-general’s portfolio until now.

Today, ASIO’s purpose is described as being to “counter terrorism and the promotion of communal violence”, “counter serious threats to Australia’s border integrity”, “provide protective security advice to government and business” and “counter espionage, foreign interference and malicious insiders”.

The Office of National Assessments (ONA) is Australia’s peak intelligence assessment agency. It was established in 1977, after the Royal Commission on Intelligence and Security commissioned by then Prime Minister Gough Whitlam and chaired by Justice Robert Marsden Hope.

ONA was established to help coordinate priorities across related intelligence agencies. Today, it is charged with assessing and analysing international political, strategic and economic developments for the prime minister and senior ministers. ONA draws on the intelligence collected by the other intelligence agencies, as well as unclassified, or “open source”, intelligence and material provided by international partners.

The agencies mentioned so far – ONA, ASIO, ASIS, AGO, ASD and DIO – form what has come to be known as the Australian Intelligence Community (AIC). The AIC emerged from the reforms initiated by Justice Hope in the 1970s and 1980s, notably following the 1977 commission and the 1985 Royal Commission on Australia’s Security and Intelligence Agencies. The combined effect of these commissions was that ONA was tasked with coordinating intelligence priorities along with the other agencies.

The tangled web of the Australian Intelligence Community. Office of National Assessments

A greater level of scrutiny

Another mechanism that emerged during this period was the office of the Inspector General of Intelligence and Security (IGIS), currently held by former Federal Court judge Margaret Stone. Established in 1987 with the enduring power of a royal commissioner, the IGIS has extraordinary powers to inspect and review the operations of AIC agencies.

The Parliamentary Joint Committee on Intelligence and Security (PJCIS) exists to provide a level of parliamentary oversight, complementing the work of the IGIS. It conducts inquiries into matters referred by the Senate, the House of Representatives or a minister of the Commonwealth government.

The Intelligence Services Act 2001 saw legislation more closely account for the functions that AIC members were expected to perform and the Inspector General monitors. In addition, an Independent National Security Legislation Monitor(INSLM) was established.

The 2017 Independent Intelligence Reviewwas the third such review since 2001. As part of the review, ONA is to become the Office of National Intelligence (ONI), exercising oversight of the expanded National Intelligence Community (NIC). This covers the initial six AIC members and four additional ones described below.

In addition, ASD is being established as a statutory body (still under the defence minister, but administered separately from the rest of the Defence Department) alongside other principal agencies ASIO and ASIS.

An expanded community with ambiguous oversight

The ONI is now tasked with overseeing implementation of recommendations arising from the 2017 review. This includes managing the four-body expansion to the ten-agency NIC.

These four bodies have played an increasingly prominent national security role since 2001. They are:

• the Australian Federal Police (AFP), with a remit for criminal intelligence and counter-terrorism

• the Australian Transaction Reports and Analysis Centre (AUSTRAC), Australia’s specialist financial intelligence unit

• the Australian Criminal Intelligence Commission (ACIC), responsible for “investigative, research and information delivery services work with law enforcement partners”.

• the Australian Border Force (ABF), described as Australia’s customs service and an “operationally independent” agency in the Home Affairs portfolio.

Deputy Commissioner Mandy Newton represents the Australian Border Force alongside Home Affairs Secretary Michael Pezzullo at a senate estimates committee hearing. Mick Tsikas/AAP

These agencies work in conjunction with other AIC agencies as well as state police and security counterparts.

The 2017 independent review was announced at the same time the new Home Affairs Department was made public. These four bodies are among the agencies transitioning to the Home Affairs portfolio. This has complicated arrangements for implementing the review recommendations and left considerable ambiguity concerning overlap of changed arrangements.

The INSLM certainly has a significant task as well and the PJCIS will be growing in staff to meet the expanded set of responsibilities outlined by the 2017 review as our intelligence community grows from six to ten agencies.

Implementing the 2017 review recommendations alone presents a significant challenge. The creation of Home Affairs on top of this adds to the complexity at a time of growing security challenges.