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1. Australia as a Rising Middle Power

Author:
Malcolm Davis
Publication Date:
04-2020
Content Type:
Working Paper
Institution:
Centre for Non-Traditional Security Studies (NTS)
Abstract:
This paper examines the key drivers shaping Australia’s role as a middle power in an era of intensifying US-China strategic competition. These drivers include the influence of strategic geography; its historical legacy in international affairs; the impact of its economic relationships with states in the Indo-Pacific region; the changing demands of defence policy, including the potential offered by rapid technological change; and, the impact of climate change, resource constraints and demographic factors. The paper considers three possible scenarios that will shape Australia’s middle power policy choices – a US-China strategic equilibrium; a “China crash” scenario that promotes a more nationalist and assertive Chinese foreign policy; and a third “major power conflict” scenario where competition extends into military conflict. The paper concludes that Australia cannot maintain a delicate balance between its strategic alliance with the US and trading relationship with China. It argues there is a need for Australia to adopt a deeper strategic alliance with the US while promoting closer ties with its partners in the Indo-Pacific and supporting the growth of a Free and Open Indo-Pacific region to counterbalance growing Chinese power. Australia needs to embrace an Indo-Pacific step up, and as a middle power, reduce the prospect of a Sino-centric regional order emerging.
Topic:
Defense Policy, Nationalism, Military Strategy, and Conflict
Political Geography:
United States, China, Asia, Australia, and Indo-Pacific

2. The Cost of Defence 2020-2021. Part 1: ASPI 2020 Strategic Update Brief

Author:
Marcus Hellyer
Publication Date:
08-2020
Content Type:
Policy Brief
Institution:
Australian Strategic Policy Institute
Abstract:
The Defence Strategic Update (DSU) represents a remarkable commitment by the Australian Government to sustained growth in the defence budget. Released on 1 July after months of bad economic news caused by the Covid-19 pandemic and growing budget deficits caused by the government’s measures to mitigate the economic pain, the DSU nevertheless confirms the robust funding line presented in the 2016 Defence White Paper (2016 DWP) and extends it for a further four years. This means the defence budget will continue to grow past 2% of GDP, and indeed at a faster rate than before the Covid-19 pandemic hit. Measured from a starting point in 2019–20, the budget is planned to grow by a remarkable 87.4% over the coming decade. Why did the government make that commitment? It’s clear from the DSU that it’s very concerned about Australia’s strategic circumstances, which it assesses as having deteriorated significantly in the four years since the 2016 DWP. It states that the region is in the middle of the most consequential strategic realignment since World War II. That brings significant uncertainty and risk. The government regards robust military capabilities as essential to managing it. The DSU marks a clear break from previous high-level strategic statements in the frank way it describes those risks and the new capabilities needed to address them. It also makes several key adjustments to strategic policy settings: It redefines our immediate region to an arc from the northeastern Indian Ocean, through maritime and mainland Southeast Asia, to Papua New Guinea and the Southwest Pacific. It’s still a huge area. It prioritises the immediate region for defence planning. It introduces the concepts of ‘shape’, ‘deter’ and ‘respond’ to focus defence planning. The emphasis on shaping reinforces the importance of regional engagement and partnerships in creating a region conducive to our interests. It states that a largely defensive force won’t deter attack. Instead, ‘new capabilities are needed to hold adversaries’ forces and infrastructure at risk from a greater distance. They include longer range strike weapons, cyber measures and area-denial systems.’ It acknowledges that Australia can no longer rely on warning time, even for a conventional military attack on Australia, and so won’t have time to ‘gradually adjust’ military capabilities. While the redefinition of the immediate region might not in itself result in changes to the defence investment program—now known as the Force Structure Plan (FSP)—the other factors listed certainly will. To acquire new capabilities, the growth in the DSU’s funding model continues the pattern of the 2016 DWP. That means the capital component of the budget grows to 40% of the total budget and stays there. That’s a far higher percentage than has historically been the case. By the end of the decade, if that planned increase is achieved, the acquisition component of the budget will have grown by 148% in nominal terms from its 2019–20 start point. Despite the broader economic and budget uncertainty, this means that Defence is in the fortunate position of being able to add some significant new capabilities to its shopping list. Perhaps the most remarkable feature of the FSP is that the ADF has entered the ‘age of missiles’ with a vengeance. There’s potentially $100 billion in investment over the next two decades in missiles and guided weapons. That includes the offensive systems needed to deter and defeat an adversary from a greater distance, such as hypersonic weapons. Even the Army is acquiring long-range missiles. But it also includes greatly enhanced defensive systems, such as ballistic missile defence, which is something Defence has considered for a long time but never previously committed to. That’s a clear sign that the region is getting much more dangerous. While the FSP is short on detail, the big picture it paints is pretty clear. It’s one in which the ADF continues its trajectory of steadily fielding improved capability and developing greater strategic weight. But there are risks, both in the design of the plan itself and in delivering it, that need to be managed. It must be said that Defence’s planning processes are improving along with its costing methodologies, so it’s likely that these are risks that it has considered in the development of the DSU and FSP. The first set of risks relates to the question of whether this is the right force for our deteriorating circumstances. Despite the recognition that Australia can’t rely on warning time, much of the planned force is still a long way off in the future. The first future frigate won’t be operational for 10 years and the first future submarine for 14, and subsequent vessels are to be delivered only on a two-year drumbeat. The Air Force isn’t getting additional air combat aircraft beyond its 72 F-35As until late in the decade. Most of the major new additions to the force structure are also some way off in the future. There’s a funding line that potentially provides a way forward to get Boeing’s Loyal Wingman unmanned aerial vehicle into service, but most of the big buckets of funding for unmanned and autonomous systems are still late in the 2020s or even in the 2030s. Until then, it looks like Defence is relying on improved weapons delivered from existing platforms to provide the main capability enhancement. Also, the force envisaged in the DSU and FSP is growing increasingly broad. There are many new capabilities in the plan, but virtually none are being retired or cancelled. Similarly, the range of tasks that the force is being asked to do isn’t being reduced. In fact, the DSU requires greater regional engagement as well as greater capacity for domestic disaster response—but will the force be able to do all the tasks expected of it? Related to this, our changing strategic environment seems to be pulling the force in two directions. The DSU states that we can’t match major-power adversaries and need to develop capabilities to deter them through strike, cyber and area-denial systems. This suggests a growing recognition of the need for asymmetric operational concepts and capabilities, yet the force is still largely being built around traditional, conventional capabilities such as expensive, multi-role, manned platforms of the kind Australia has relied upon to overmatch potential adversaries. Defence is also investing in an increasingly heavy conventional land force. That’s likely to be useful against some potential non-peer adversaries—but does it play a deterrent role against a major-power adversary? There’s also the question of balance between acquisition, sustainment and personnel funding. Acquisition’s share of the budget is growing rapidly. Personnel’s share is also growing but more slowly, and will decline as a percentage of the overall budget. The DSU states that the government will consider increases to Defence’s workforce next year, but those numbers are already accounted for in the DSU’s personnel funding stream, suggesting that any additional people won’t change the overall trajectory of personnel’s share of the budget. Certainly, increased capital spending is necessary, but is a 40% acquisition / 26% personnel balance feasible in the long term? There’s no point acquiring equipment you can’t crew. Then there are a set of risks that relate to the feasibility of delivery. The first, as ever, is money. The economic future of both Australia and the world is still very uncertain. If the economic impact of Covid-19 results in prolonged economic stagnation, it’s going to take sustained resolve by this and future governments to keep increasing defence funding over the decade. Should that resolve waver and a government revert to something like 2% of GDP, that would be a huge hit to the defence budget of potentially $5–10 billion per year, with a resultant cut to either existing core capabilities or the planned new ones. The government has already stated that it’s committed to Defence’s ‘megaprojects’ and that they aren’t part of any prioritisation or trade-off process, so other things will bear the brunt of any funding hit—potentially, the new asymmetric capabilities being introduced to deter a major-power adversary. Then there’s the very difficult question of the affordability of the force. The defence budget is growing substantially, but so is the list of capabilities Defence is acquiring and sustaining. The acquisition cost of military capabilities grows much faster than inflation. Since 2016, several key capabilities have grown significantly in cost (including submarines, frigates, armoured vehicles and air defence). Moreover, sustainment costs are also growing. The sustainment cost of key future capabilities is likely to be several times greater in real terms than the systems they’re replacing. One of the biggest implementation risks relates to Australian industry’s ability to scale up to deliver the force. The local share of Defence’s capital equipment spend has consistently hovered around one-third of the total. Last year, that was around $2.6 billion. As the capital budget rapidly grows over the decade, local acquisition spending will have to grow to over $7 billion per year just to maintain that one-third share. But it’s clear the government wants that share to grow. It has to, if we’re going to address the supply-chain risks currently inherent in defence capability. Getting to between 40% and 50% means the local acquisition spend will need to reach around $10 billion per year. That’s a lot of money for Australian industry to absorb and a lot of capability for it to deliver, but, if it doesn’t get there, the government won’t achieve the level of sovereign capability that it’s seeking and we’ll continue to rely on imported systems, with the attendant supply-chain risks. While the basic settings of the government’s 2016 defence industry policy statement are the right ones, it’s likely that it’s going to have to do more to develop the kind of local industrial ecosystem necessary to deliver the level of sovereign capability described in the DSU and FSP. Relying on the local assembly of foreign designs using mainly foreign high-value subsystems isn’t going to get us there. More needs to be done to generate technological innovation and advanced manufacturing here. There are only minor increases to innovation funding in the DSU, for example. The new line in the FSP to develop sovereign weapons manufacturing could be a model for a more deliberate approach to generating sovereign industrial capability. The other risk associated with industry policy is the old one of falling into the trap of preferring industrial outcomes to military capability. That risk has already been realised. Some of the hidden costs of continuous-build programs are becoming more apparent: the FSP states that the cost increase for the Future Frigate Program was caused by the government allocating ‘additional funding to enable construction of ships at a deliberate drumbeat over a longer period of time than originally planned to achieve a continuous shipbuilding program’. That is, we’re deliberately paying more to get capability later. The DSU acknowledges that we can no longer rely on warning time to be able to gradually adjust military capability, so surely now’s the time to be spending to accelerate delivery and the rate at which we ‘adjust capability’, not slow it down. If we’re willing to pay a premium to build here, let’s pay it to get more capability sooner, not later. Why are we prioritising jobs for future generations of shipbuilders over capability for current servicemen and women who may be called upon in the near future to use it? The new strategy has been written, and the government most certainly understands the urgency driving its defence policy changes. The key question is whether Defence can sufficiently internalise that urgency to implement the changes needed in how the organisation does business. The Minister for Defence, Linda Reynolds, stated on 7 August that ‘the Defence Department … has systematically for over 100 years failed to deliver on the government’s expectations of the enterprise.’ We now have a plan that calls for speed, lateral thinking, innovation and partnerships—to be implemented by an organisation that’s slow, subject to groupthink, risk averse and reluctant to reach out. Adapting Defence to the demands of our new reality is going to be challenging, to say the least.
Topic:
Defense Policy, Budget, Economy, Economic growth, and COVID-19
Political Geography:
Australia and Australia/Pacific

3. Thailand’s strategic drift: Domestic determinants amidst superpower competition

Author:
Thitinan Pongsudhirak
Publication Date:
06-2020
Content Type:
Special Report
Institution:
Australian Strategic Policy Institute
Abstract:
After more than five years of military-authoritarian government following its 13th successful coup in May 2014, Thailand’s most recent elections on 24 March 2019 yielded a controversial parliament and a fractious post-election coalition government, headed by incumbent Prime Minister Prayut Chan-o-cha. This report argues that despite the challenges of domestic political preoccupations and the Covid-19 pandemic crisis, Thailand’s strategic role in the Indo-Pacific is too important to be marginalized and that the country is an indispensable piece of the regional jigsaw puzzle in an era of global power shifts and transitions. The current Sino-US competition involves far-reaching battleground between democracy and authoritarianism, and Thailand – one of America’s oldest treaty ally with increasingly close ties with China – is strategically consequential. The report explains the complexity of Thai’s foreign policy and implications for Australia.
Topic:
Foreign Policy, Defense Policy, National Security, and Strategic Competition
Political Geography:
Asia, Australia, Thailand, and Southeast Asia

4. Winning Hearts and Likes: How foreign affairs and defence agencies use Facebook

Author:
Damien Spry
Publication Date:
06-2020
Content Type:
Special Report
Institution:
Australian Institute of International Affairs
Abstract:
For defence and diplomacy, digital media, and specifically social media, have become an unavoidable aspect of their operations, communications and strategic international engagement, but the use of those media isn’t always understood or appreciated by governments. While the Department of Foreign Affairs and Trade (DFAT) and the Department of Defence (DoD) both use social media, including accounts managed by diplomatic posts overseas and by units of the ADF, both departments can improve how they reach and engage online. It’s important to note, however, that their use cases and audiences are different. DFAT’s audience is primarily international and varies by geographical location. Defence has a more local audience and focus. More importantly than the content, online engagement is dependent on the strength of the ties between the senders or sharers and the recipients of the content. For both departments, improving those online ties is vital as they seek to influence. The Australian Government should use social media far more strategically to engage international audiences—particularly in the diplomatic and defence portfolios. Both DFAT and Defence should review outdated digital strategies, cross-promote more content and demonstrate transparency and accountability by articulating and publishing social media policies. Both departments should create more opportunities for training and the sharing of skills and experiences of public diplomacy staff. They should refrain from relying solely on engagement metrics as success measures (that is, as a measure of an individual’s, usually senior staff’s or heads of missions’, level of ability or achievement). Instead, by changing the emphasis from the producers of social media content to the audiences that interact with it, the engagement data can be usefully regarded as a proxy for attention and interest. This can tell us what kinds of audiences (mostly by location) are engaged, and what types of content they do and don’t engage with. This information indicates the (limited) utility of social media; this should guide online engagement policy. This report also highlights and recognises the value of social media for the defence community — especially as a means of providing information and support for currently serving personnel and their families—by supporting the use of Facebook for those purposes by all defence units. DFAT should remove the direction for all Australian heads of mission overseas to be active on social media. While this presence is indeed useful and boosts the number of global government accounts, if our ambassadors aren’t interested in resourcing those accounts, the result can be sterile social media accounts that don’t engage and that struggle to connect with publics online. Instead, both departments should encourage those who are interested in and skilled at digital diplomacy to use openness, warmth and personality to engage.
Topic:
Foreign Policy, Defense Policy, Social Media, and Facebook
Political Geography:
Australia

5. From concentrated vulnerability to distributed lethality—or how to get more maritime bang for the buck with our offshore patrol vessels

Author:
Marcus Hellyer
Publication Date:
06-2020
Content Type:
Special Report
Institution:
Australian Strategic Policy Institute
Abstract:
This report proposes a way for the Australian Government to acquire maritime war-fighting capability quickly and affordably while promoting Australian industry and the continuous Naval Shipbuilding Program. It would deliver substantial new maritime capability in the next few years, in contrast to the current investment program, and it would introduce a transformative force structure for the price of one or two traditional large multi-role platforms. This would address key challenges faced by the ADF by enabling it to transition more quickly to a force structure that better supports operating concepts employing distributed lethality and greater use of autonomous systems and human–machine teaming.
Topic:
Defense Policy, Economics, National Security, Military Strategy, and Navy
Political Geography:
Australia

6. After Covid-19: Australia and the world rebuild (Volume 1)

Author:
John Coyne and Peter Jennings
Publication Date:
05-2020
Content Type:
Special Report
Institution:
Australian Strategic Policy Institute
Abstract:
This Strategy report offers policy-focused analysis of the world we will face once the pandemic has passed. At a time when all our assumptions about the shape of Australian society and the broader global order are being challenged, we need to take stock of likely future directions. The report analyses 26 key topics, countries and themes, ranging from Australia’s domestic situation through to the global balance of power, climate and technology issues. In each case we asked the authors to consider four questions. What impact did Covid-19 have on their research topic? What will recovery mean? Will there be differences in future? What policy prescriptions would you recommend for the Australian government?
Topic:
Defense Policy, Climate Change, Disaster Relief, National Security, Science and Technology, Coronavirus, Pandemic, and COVID-19
Political Geography:
Australia and Global Focus

7. Running on empty? A case study of fuel security for civil and military air operations at Darwin airport

Author:
John Coyne, Tony McCormack, and Hal Crichton-Standish
Publication Date:
05-2020
Content Type:
Special Report
Institution:
Australian Strategic Policy Institute
Abstract:
Most Australians have no idea how quickly they’ll be running on empty if fuel supplies from overseas are cut in a crisis. For decades, the nation has relied on risky, “just in time” deliveries of the fuel necessary for transport systems, industry, policing and individual motoring needs—and even the operations of the Australian Defence Force. This report describes how this situation is so fraught, and the national reserve so small, that during major military exercises and actual operations such as the search for the missing Malaysia Airlines Flight MH370, fuel stocks have reached critically low levels.
Topic:
Defense Policy, National Security, Fossil Fuels, and Aviation
Political Geography:
Australia and Australia/Pacific

8. Does Australia have an “Indo Pacific strategy”?

Author:
Thomas S. Wilkins
Publication Date:
07-2019
Content Type:
Policy Brief
Institution:
Japan Institute Of International Affairs (JIIA)
Abstract:
The US Department of Defense (DOD) released its longawaited Indo Pacific Strategy Report (IPSR) in tandem with the IISS-Shangrila Dialogue in Singapore on 1 June 2019. This IPSR appears to subsume or extend the earlier Free and Open Indo Pacific (FOIP) strategy (sometimes referred to now as a “vision”) into a more comprehensive regional Indo Pacific Strategy (IPS), that is anchored in the earlier 2017 National Security Strategy (NSS) and 2018 National Defense Strategy (NDS) documents. Australia has yet to produce an analogous document dedicated to profiling its own “Indo Pacific Strategy”, but with the US iteration in view, it is possible to construct an plausible image of such a strategy in the Australian case by drawing upon various pertinent materials from a range of government sources. Indeed, the notion of an overarching IPs is gradually taking shape in Australian strategic thinking, as testified to by a variety of official documents, including large portions of the 2016 Defence White Paper, and especially 2017 Foreign Policy White Paper, alongside other policy statements and initiatives, framed in the context of analysis and debate undertaken by nationally-based strategic commentators. A small case “s” in “Indo Pacific strategy” is specifically employed in this paper to distinguish the author’s conception from any formally mandated government “Strategy”.
Topic:
Defense Policy, International Affairs, and Grand Strategy
Political Geography:
Australia, Australia/Pacific, and Indo-Pacific

9. Ocean horizons: Strengthening maritime security in Indo-Pacific island states

Author:
Anthony Bergin, David Brewster, and Aakriti Bachhawat
Publication Date:
12-2019
Content Type:
Special Report
Institution:
Australian Strategic Policy Institute
Abstract:
The report examines how Pacific island countries (PICs) and Indian Ocean island states (IO island states) are managing and prioritising their maritime security challenges. These islands, which we call the ‘Indo-Pacific island states’, face an intricate offshore tapestry. In particular, this report suggests that most of the maritime threats and risks facing the Indo-Pacific island states are increasing. That’s in part because of the general lack of effective maritime security identified in this report. The report describes the current geopolitical environment of the Indo-Pacific island states and how we should understand maritime security in the context of island states. It examines the core maritime security concerns of the PICs and IO island states and considers points of commonality and divergence in island state perspectives on maritime security and major-power competition. The report provides key recommendations for Indo-Pacific island states and for countries, such as Australia and its partners, that wish to more effectively engage with the island states on maritime security.
Topic:
Security, Foreign Policy, Defense Policy, National Security, and Maritime
Political Geography:
Australia, Asia-Pacific, and Indian Ocean

10. Accelerating autonomy: Autonomous systems and the Tiger helicopter replacement

Author:
Marcus Hellyer
Publication Date:
12-2019
Content Type:
Special Report
Institution:
Australian Strategic Policy Institute
Abstract:
The benefits of autonomous systems on the modern battlefield have been widely recognised, yet Defence has only slowly adopted them. It continues to invest heavily in manned platforms that are increasingly expensive but still expose their crews to constantly proliferating threats. This means that Defence is acquiring small numbers of exquisite manned platforms that could be too valuable and too few to risk losing. Defence has started to explore using autonomous systems on the battlefield, but it’s now time to accelerate their development and adoption by the ADF. A new APSI Special Report, ‘Accelerating autonomy: autonomous systems and the Tiger helicopter replacement’ recommends how Defence can jump start the transition to greater use of autonomous systems. Report author Dr Marcus Hellyer said that ‘Defence has slowly been developing trust in unmanned systems. It’s laid a foundation, now it’s time to do a lot more.’ The report argues that Defence needs to identify areas of capability where autonomous systems can deliver disruptive innovation. Investing in those systems can deliver more capability at less cost than traditional manned systems.
Topic:
Defense Policy, National Security, and Military Affairs
Political Geography:
Australia and Australia/Pacific