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1. Exposing the Financial Footprints of North Korea’s Hackers

Author:
Jason Bartlett
Publication Date:
11-2020
Content Type:
Special Report
Institution:
Center for a New American Security
Abstract:
North Korea conducts intricate and sweeping cyberattacks against the United States and its allies to acquire funds to support its illicit nuclear proliferation efforts. Unlike more economically advanced nuclear states possessing domestic research, development, and deployment capacities to establish weapon of mass destruction (WMD) programs, the Democratic People’s Republic of Korea (DPRK) must seek financial resources, assistance, and institutional knowledge, at least initially, from overseas. It has developed its cyber capabilities in order to circumvent financial sanctions and global safeguards, conducting elaborate online bank heists and hacking attacks; stealing funds through fraudulent bank transfers, Society for Worldwide Interbank Financial Telecommunications (SWIFT) transactions, and ATM cash-outs; launching ransomware attacks demanding payment in cryptocurrency; and hacking cryptocurrency exchanges. The scale and sophistication of these innovative sanctions evasion tactics create a challenge that calls for stronger measures to confront them. In addition to providing policy recommendations for U.S. leadership and financial institutions, this report will outline the ways North Korea supports, expands, and utilizes cyber operations to acquire funds for its nuclear weapons program.
Topic:
Science and Technology, Cybersecurity, and Finance
Political Geography:
Asia, North Korea, North America, and United States of America

2. America’s Use of Coercive Economic Statecraft

Author:
Elizabeth Rosenberg, Peter Harrell, Paula J. Dobriansky, and Adam Szubin
Publication Date:
12-2020
Content Type:
Special Report
Institution:
Center for a New American Security
Abstract:
U.S. policymakers will continue to intensively use a growing array of coercive economic tools, including tariffs, sanctions, trade controls, and investment restrictions. The growing use reflects a desire by policymakers to use coercive economic tools in support of a growing range of policy objectives. Diplomacy around these tools has long been challenging and can require hard choices. To use these tools effectively, policymakers should focus on articulating clear objectives and measuring effectiveness and costs. U.S.-China competition raises the stakes for getting the use of coercive economic statecraft right. Policymakers in the next presidential administration and Congress would be well-served to spend at least as much effort focusing on the positive tools of statecraft. These include domestic economic renewal, international finance and development incentives, and positive trade measures, among others.
Topic:
Development, Diplomacy, Sanctions, and Economy
Political Geography:
China, Asia, North America, and United States of America

3. Renew, Elevate, Modernize: A Blueprint for a 21st-Century U.S.-ROK Alliance Strategy

Author:
Kristine Lee, Joshua Fitt, and Coby Goldberg
Publication Date:
11-2020
Content Type:
Special Report
Institution:
Center for a New American Security
Abstract:
The U.S.–South Korea alliance is a primary deterrent to the threat North Korea’s growing nuclear arsenal poses. But the alliance’s nearly singular functional focus on managing the North Korea threat, despite South Korea’s broadly integral role in advancing a rules-based order in the region, has introduced volatility in the bilateral relationship. Washington’s halting and inconsistent approach to Pyongyang and its failure to reach a timely agreement on its military cost-sharing framework with Seoul have nudged the alliance toward a new inflection point. Beyond the North Korea challenge, South Korea has the potential to play a consequential role in advancing the United States’ broader vision for a rules-based order in the Indo-Pacific. As Seoul adopts globally oriented policies, buoyed by its position at the leading edge of certain technology areas and its successful COVID-19 pandemic response, the United States should parlay these efforts into a more concrete role for South Korea as a partner on the world stage. Collaborating on global public health issues, combating climate change, and jointly developing norms around critical emerging technologies would position the alliance to meet the challenges of the 21st century. By widening the aperture of the alliance and positioning Seoul to play an integral role in the United States’ vision for the future of the Indo-Pacific, the two allies will be better equipped to address enduring geopolitical risks in Northeast Asia, including those associated with a nuclear-armed North Korea.
Topic:
Defense Policy, Nuclear Weapons, Alliance, and Modernization
Political Geography:
Asia, South Korea, North America, and United States of America

4. Charting a Transatlantic Course to Address China

Author:
Julianne Smith, Andrea Kendall-Taylor, Carisa Nietsche, and Ellison Laskowski
Publication Date:
10-2020
Content Type:
Special Report
Institution:
Center for a New American Security
Abstract:
Mounting competition between China and liberal democracies will shape the course of the 21st century. The gravity and scope of the challenges that China poses have permeated the transatlantic policy agenda and become a focal point in U.S.-Europe relations. Whereas China has long been a source of disagreement and even tension between the transatlantic partners, in the past two years views have converged. The Chinese Communist Party’s (CCP) assertive actions—its “Wolf Warrior” diplomacy, aggressive influence operations, human rights violations at home, and elimination of fundamental freedoms in Hong Kong—have increased concerns in both the United States and Europe. There is now fertile ground for transatlantic cooperation on everything from reducing dependency on Chinese trade and investment to setting global norms and standards for the future. Yet, despite this convergence of views and interests, there is still no roadmap for how such cooperation should progress. This report outlines such an approach. It is based on the premise that the time is ripe for greater transatlantic cooperation on China. It also recognizes the comprehensive nature of the task at hand. Today’s controversies with China over trade, investment, technology, and global governance are all part of a larger competition between political systems and worldviews. The breadth of the challenge means that the United States and Europe must compete with China across multiple domains. This report lays out a roadmap for doing so, outlining concrete recommendations across the four sectors of technology, investment, trade, and global governance. By working together, the United States and Europe can pool the resources and leverage needed to push back against the CCP in these areas and develop preferred alternatives that advance strategic priorities for both sides of the Atlantic. Moreover, the strategies outlined in this report will also serve a second purpose: re-energizing the ailing relationship between Europe and the United States.
Topic:
Security, International Cooperation, Transatlantic Relations, and Strategic Competition
Political Geography:
China, Asia, North America, and United States of America

5. Digital Entanglement; Lessons Learned from China’s Growing Digital Footprint in South Korea

Author:
Kristine Lee, Martijn Rasser, Joshua Fitt, and Coby Goldberg
Publication Date:
10-2020
Content Type:
Special Report
Institution:
Center for a New American Security
Abstract:
The South Korean experience is an illustrative case study of digital entanglement with China. This paper focuses on South Korea’s 5G networks for the purposes of scoping, but the spotlight on telecommunications networks offers just one window into a broader trend of technology and economic interdependencies between Seoul and Beijing. In particular, the paper’s focus on 5G illuminates four central observations that could also apply to other technology areas: (1) the U.S.-China strategic competition has wedged South Korea between its most important ally and its largest trading partner; (2) geopolitical risk assessments are not top of mind in South Korea’s technology policymaking calculations; (3) the country’s political leadership largely defers to private industry on the use of Chinese equipment; and (4) South Korean privacy regulations remain relatively fluid and are evolving both to meet domestic pressures and to generate new market opportunities. These trends are evident in the history of South Korea’s economic entanglement with China and the risk of coercion carried with it. Ongoing entanglement with digital infrastructure—and 5G networks in particular—increases the potential for and reach of adverse economic statecraft by Beijing and will make it more difficult and costly to unravel.
Topic:
Science and Technology, Communications, Bilateral Relations, COVID-19, and 5G
Political Geography:
China, Asia, and South Korea

6. The Razor’s Edge: Liberalizing the Digital Surveillance Ecosystem

Author:
Kara Frederick
Publication Date:
09-2020
Content Type:
Special Report
Institution:
Center for a New American Security
Abstract:
The COVID-19 pandemic is accelerating global trends in digital surveillance. Public health imperatives, combined with opportunism by autocratic regimes and authoritarian-leaning leaders, are expanding personal data collection and surveillance. This tendency toward increased surveillance is taking shape differently in repressive regimes, open societies, and the nation-states in between. China, run by the Chinese Communist Party (CCP), is leading the world in using technology to enforce social control, monitor populations, and influence behavior. Part of maximizing this control depends on data aggregation and a growing capacity to link the digital and physical world in real time, where online offenses result in brisk repercussions. Further, China is increasing investments in surveillance technology and attempting to influence the patterns of technology’s global use through the export of authoritarian norms, values, and governance practices. For example, China champions its own technology standards to the rest of the world, while simultaneously peddling legislative models abroad that facilitate access to personal data by the state. Today, the COVID-19 pandemic offers China and other authoritarian nations the opportunity to test and expand their existing surveillance powers internally, as well as make these more extensive measures permanent. Global swing states are already exhibiting troubling trends in their use of digital surveillance, including establishing centralized, government-held databases and trading surveillance practices with authoritarian regimes. Amid the pandemic, swing states like India seem to be taking cues from autocratic regimes by mandating the download of government-enabled contact-tracing applications. Yet, for now, these swing states appear responsive to their citizenry and sensitive to public agitation over privacy concerns. Open societies and democracies can demonstrate global surveillance trends similar to authoritarian regimes and swing states, including the expansion of digital surveillance in the name of public safety and growing private sector capabilities to collect and analyze data on individuals. Yet these trends toward greater surveillance still occur within the context of pluralistic, open societies that feature ongoing debates about the limits of surveillance. However, the pandemic stands to shift the debate in these countries from skepticism over personal data collection to wider acceptance. Thus far, the spectrum of responses to public surveillance reflects the diversity of democracies’ citizenry and processes.
Topic:
Science and Technology, Authoritarianism, Surveillance, and COVID-19
Political Geography:
China, Asia, and United States of America

7. Open Future: The Way Forward on 5G

Author:
Martijn Rasser and Ainikki Riikonen
Publication Date:
07-2020
Content Type:
Special Report
Institution:
Center for a New American Security
Abstract:
Communication networks are the central nervous system of the 21st century economy. The fifth generation of wireless—5G—will be essential to and inseparable from all we do. In many ways, we are already there. What for most was an abstract concept became all too real during the COVID-19 crisis. The coronavirus pandemic has underscored the critical importance of communication networks: They are integral to our daily lives and our ability to function economically and as a society. Shutdowns of offices, schools, and stores have meant turning to apps to work, learn, and buy. Frontline medical workers and vaccine researchers have consulted colleagues via teleconference to get the latest insight and advice on combating the virus. Being connected means resilience, coping, surviving. Getting 5G right is all the more urgent. Next-generation 5G networks will enable telemedicine, self-driving cars, and a proliferation of Internet of Things devices to fuel the future digital economy. Secure, reliable 5G networks will be essential elements of national infrastructure. Policymakers in Australia, Japan, and Vietnam understood this early on and took decisive action to secure their 5G networks. U.S. officials, slower out of the gates, are now the loudest voice on the risks of having equipment from untrusted vendors in 5G networks. The spotlight is brightest on the risks that Huawei poses to national security, including the threat of espionage or disruption. Given the Chinese Communist Party’s ability to exercise control over Huawei, there is justifiable concern over data integrity on networks that deploy Huawei equipment. More serious is the potential to use 5G equipment as a vector to cripple critical infrastructure. Such risk is not only about communications—5G will be the backbone of controls needed for power grids, water supplies, and transportation infrastructure. Despite this, the United States has had only limited success convincing its allies to join it in banning Huawei. The United States has the opportunity to regain momentum by taking a fresh approach to 5G in the aftermath of the pandemic. In addition to the broader appreciation for the criticality of reliable communication networks, Beijing’s coronavirus cover-up and clunky attempts at soft power have hardened public opinion toward China around the world. The economic fallout of the pandemic will likely slow 5G deployments globally, curtailing the urgency with which many operators approached the issue. At the same time, the first commercial projects centered on technological alternatives to the predominant 5G approach are being deployed. This confluence of events presents the United States and like-minded countries an opening to promote an alternative approach that could lead to a paradigm shift in the industry: wireless infrastructure built on a modular architecture with open interfaces. A modular architecture allows an operator to choose multiple vendors for a range of offerings, rather than being locked in with a single large integrated vendor. Open interfaces—the ability of equipment from any vendor to work with that of another—make that possible. Such a shift means upending the industry status quo that is dominated by four telecommunications equipment providers: China’s Huawei, Finland’s Nokia, Sweden’s Ericsson, and South Korea’s Samsung. Whereas other proposed responses to the Huawei dilemma and the problematic current state of competition in the telecommunications industry fiddle at the margins, switching to an industry centered on open interfaces would change the game altogether. A restructured industry based on open interfaces would directly address the prevailing concerns over untrusted vendors such as Huawei and the broader inefficiencies of the industry. There are distinct advantages to be gained in security and interoperability, supply chain resiliency, probable cost savings, and the opportunity to stimulate much-needed competition in the sector. Taken together, these advantages do much to blunt Beijing’s industrial policies that have enabled Huawei’s predatory anti-competitive practices.
Topic:
National Security, Science and Technology, Communications, COVID-19, and 5G
Political Geography:
China, Asia, North America, and United States of America

8. Restoring Strategic Competence: How to Manage Northeast Asian Alliance Dilemmas amid a Nuclear North Korea

Author:
Van Jackson
Publication Date:
07-2020
Content Type:
Special Report
Institution:
Center for a New American Security
Abstract:
For the foreseeable future, America’s Northeast Asian allies Japan and South Korea must live in the shadow of a nuclear North Korea, whose capabilities they cannot match. During the Obama and Trump administrations, North Korea dramatically expanded and improved its ability to hold Japanese, South Korean, and even U.S. territory at risk with its nuclear and missile arsenal.1 Despite high-profile summitry and promises to the contrary, there is no sign that this imbalance will be rectified, and its continuation exacerbates regional risks and ally insecurity.2 The mounting North Korea threat is compounded by poor timing—U.S. policy has proven exceptionally erratic, unreliable, and risk-prone in recent years. The very existence of Japan and South Korea depends on strategies built around a partnership with the United States that has become shaky, and on faith in the competence of U.S. statecraft—which both countries are starting to perceive as a risk rather than a source of security. Ally perceptions of U.S. strategic incompetence generate real costs and risks for the United States and Northeast Asian security. If the United States continues to squander its deepest relationships in Asia, the allies could become rivals with each other, increase risks of nuclear instability, play a spoiler role in U.S. regional strategy, withhold basing and access rights to U.S. forces operating in the region, and potentially take independent aggressive actions against North Korea that unintentionally escalate to war.
Topic:
Security, Nuclear Weapons, and Alliance
Political Geography:
Japan, Asia, South Korea, and North Korea

9. Dangerous Synergies Countering Chinese and Russian Digital Influence Operations

Author:
Daniel Kliman, Andrea Kendall-Taylor, Kristine Lee, Joshua Fitt, and Carisa Nietsche
Publication Date:
05-2020
Content Type:
Special Report
Institution:
Center for a New American Security
Abstract:
The 2016 U.S. presidential election and the 2018 and 2020 Taiwanese local and presidential elections crystallized that Russia and China are using digital interference to shape the contest between democracies and autocracies. While foreign information operations are time-tested methods of authoritarian influence, the digital space has increased the scope and speed with which these operations can be waged. Although there is no concrete evidence to suggest that Beijing and Moscow explicitly coordinate their information operations, the two countries are increasingly finding common cause as their interests align on a number of issues and in strategic regions.
Topic:
International Relations, Foreign Policy, Science and Technology, Authoritarianism, and Digital Policy
Political Geography:
Russia, China, and Asia

10. A New Arsenal for Competition: Coercive Economic Measures in the U.S.-China Relationship

Author:
Elizabeth Rosenberg, Peter Harrell, and Ashley Feng
Publication Date:
04-2020
Content Type:
Special Report
Institution:
Center for a New American Security
Abstract:
The United States and China have long used coercive economic measures to advance both economic and foreign policy objectives. In recent years, however, both countries have turned to coercive economic measures as mainstream instruments of foreign policy and national security policy, and increasingly have deployed coercive economic measures against each other. For the United States, China’s economic scale and global interconnections make it a fundamentally different type of target for coercive economic measures than the comparatively smaller and less sophisticated economies that have been primary targets of U.S. economic coercion in the past. The United States cannot simply isolate China from the global economy. Instead, it must adopt a more strategic focus on limiting Chinese actions in areas significant to U.S. national security and shoring up economic and technology arenas where the United States maintains lasting leverage. Over the past several years, the United States has deployed an array of coercive economic measures against China. The most prominent of these have been the tariffs on approximately two-thirds of U.S. imports from China. The tariffs remain largely in place despite implementation of the Phase One trade deal that the United States and China signed in January 2020. But the United States also has developed and deployed an increasingly sophisticated set of other coercive economic tools that will play a prominent role in U.S.-China relations over the years ahead, regardless of whether the United States and China fully implement the Phase One deal and reach a broader Phase Two trade agreement. Those other coercive economic tools include export controls, restrictions on U.S. imports to secure U.S. supply chains, heightened scrutiny of Chinese investment in the United States, sanctions, and stepped-up law enforcement measures against Chinese intellectual property (IP) theft and other Chinese activities in the United States. This expanding set of measures serves a broadening array of U.S. policy goals, including economic objectives, foreign policy goals, and the maintenance of America’s technological edge. The U.S. record of success in the use of these coercive economic measures has been mixed. While tariffs and other measures have succeeded in putting some macroeconomic pressure on China, they have not extracted fundamental concessions from Beijing. Targeted sanctions and law enforcement measures similarly have had economic impacts on some Chinese companies, but other Chinese companies have demonstrated an ability to weather U.S. economic coercion. To be effective in translating economic coercion into policy change by China, the United States needs to better integrate its coercive measures with each other and with other policies, better signal intentions and escalation, more rigorously assess impacts and costs, and galvanize allied support and coordinated action. For its part, China appears to recognize a balancing act between limiting economic ties with foreign partners in some domains and maintaining them in others. China has sought to distance certain Chinese economic sectors, particularly high-tech manufacturing, from the United States in some areas, investing heavily in domestic capacity development. In other areas where China must rely on foreign partners for technology, IP, or manufacturing, or where China does not appear to see a clear interest in severing trade, Beijing has sought to keep trade and investment flows moving in an unencumbered fashion. As for the United States, this is a dynamic policy environment.
Topic:
Security, Bilateral Relations, Economy, and Strategic Competition
Political Geography:
China, Asia, North America, and United States of America