In contrast to its predecessors, the Trump administration has brought about some relevant changes to U.S. foreign policy towards the People’s Republic of China. According to the 2018 National Defense Strategy, “inter-state strategic competition” has reappeared as the principal threat to U.S. national security.

Similarly, the 2017 National Security Strategy contends that China—together with Russia—threatens to challenge “American power, influence, and interests, attempting to erode American security and prosperity.” In short, China must be considered a “strategic competitor” and a “revisionist power” as it is promoting a worldview utterly “antithetical” to U.S. values and interests.

Each subsequent strategic and operational document released by the Trump administration since the National Security Strategy (2018 Nuclear Posture Review; 2018 Design for Maintaining Maritime Superiority 2.0; 2019 Missile Defense Review) has chorused those conclusions. After unveiling the 2017 NSS, the White House imposed tariffs on China in response to allegedly unfair trade practices.

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The United States first imposed tariffs on $3 billion worth of goods and then enacted measures on another $50 billion. In September of 2018, the U.S. imposed a 10% tariff on approximately $200 billion worth of Chinese goods, with a possibility of a rise to 25% in January 2019. The U.S. and China negotiated a temporary truce over further protectionist escalation at the G-20 Summit in Buenos Aires in December 2018, averting an increase in tariffs on Chinese exports. Nevertheless, competition between the U.S. and China is expected to endure, primarily in the economic and technological realms, forcing Washington and Beijing into an uneasy peace.

After four decades of economic growth, China today is a great power, eager to pursue its strategic interests. On a global level, however, China is bound by structures, institutions, procedures, and rules that have been promoted by the United States since 1945, and ultimately standardized after the collapse of the Soviet Union and the end of the Cold War.

Regionally, Chinese expansionism is constrained by the U.S.-led hub-and-spoke security system that binds the United States with its allies and partners in the Indo-Pacific region (primarily Japan, the Republic of Korea, the Philippines, Taiwan, Australia, and New Zealand). Policymakers should keep the following four points in mind when developing China policies—these four “nots” are essential for understanding Chinese behavior, goals, and interests.

1. The center of political authority in China is NOT Xi Jinping; it’s the Chinese Communist Party. This is not to downplay the role Xi has played in fueling China’s global ambitions—rather, since 1978, it has been the Party that ultimately drives China’s foreign policy and grand strategic goals. It has always been since 1978. If Xi wants to implement a new vision or global agenda, he nevertheless needs the Party’s approval. Additionally, as Rush Doshi contends, concepts usually attributed to Xi such as “national rejuvenation,” “strategic opportunity,” and “China’s great power status,” were laid down before Xi rose to the apex of the CCP in November 2012.
2. China’s revisionist behavior is NOT revolutionary; It’s incremental and selective. As Robert Gilpin’s hegemonic stability theory states, there are two plausible paths of systemic revisionism: incremental and revolutionary. Incrementalism aims to implement “continuous adjustments within the framework of the existing system,” while revolution occurs with “intermittent abrupt changes.” Empowered by forty-years of unprecedented economic growth, Beijing eventually became more assertive and demanding of what it perceives is a more accommodating and beneficial international order, but stopped short of attempting a sweeping and radical restructuring of the global order. Thus, as Evan Feigenbaum states, China is carrying out revisionist policies through an incremental and selective approach rather than a revolutionary one.
3. China is NOT a peer competitor to the U.S. at present, but it could be in the future. Today, Chinese economic growth has run aground as Xi Jinping pursues structural reforms to shepherd the country into a more sustainable and domestic-consumption-driven path, a move which will inevitably stimy economic growth. Furthermore, a formidable strand of literature (see Stephen Brooks and William Wohlforth, Michael Beckley and Andrea and Mauro Gilli) has flourished in recent years stressing China’s deficiencies while outlining obstacles to reaching parity with the United States. Stephen Brooks and William Wohlforth accurately identify national military, economic and technological capabilities that are “tailored for superpower status,” but conclude that “the one-superpower [the U.S.] system is not on the cusp of structural change” and that “there has been no transformation in its fundamental operating dynamics,” despite Chinese advances.
4. China is NOT out-of-the-way; it’s in-the-way. Globalization and forty years of normalized diplomatic relations have intertwined Beijing and Washington on multiple fronts: currency reserves, trade, investments, industrial complementarity, cultural exchanges, international security matters in which both parties have interests, and more. As Michael Swaine appraised, disentangling—or decoupling—a relationship of such complexity, while addressing critical nodes, will require more than labeling China as an existential threat and discarding China’s contribution to global security and prosperity.

Beijing is a revisionist power, but it is not necessarily a subversive actor on the global stage. Indeed, as the U.K. Parliament’s Foreign Affairs Committee recently assessed, “China is a force for order, but not liberal order.” For its part, the Trump Administration is advancing a Free and Open Indo-Pacific strategy that, despite promoting strong global cohesion in the face of China’s rise, displays a proclivity for unilateralism. Policymakers should consider the four “nots” as a starting point for developing a long-term strategy for countering Chinese revisionism.

The Four “Nots” to Correctly Interpreting China’s Rise was originally published on Global Security Review.

In Afghanistan, the U.S. and its allies have deployed cutting-edge aerial intelligence, surveillance, and reconnaissance (ISR) capabilities. What is missing, however, is good human intelligence (HUMINT) collection capabilities. Afghans have been entrusted with the task of HUMINT collection, but multiple Taliban infiltration and sabotage operations illustrate the need for comprehensive reform of Afghanistan’s intelligence apparatus.

The Afghan intelligence community requires a robust overhaul. This includes investment in both human and technical capabilities alongside a comprehensive reform program. Afghanistan’s intelligence community is comprised of the National Directorate of Security (NDS), Police Intelligence (PI) and Military Intelligence (MI). Some coordination centers, including Tawheed, NASRAT, and the Presidential Information Coordination Center (PICC) connect and share strategic, operational, and tactical intelligence between the individual agencies.

Regarding organizational hierarchy, the Afghan intelligence community is structured like a pyramid, with the powerful National Directorate of Security at the top. The NDS oversees Afghanistan’s overall intelligence machinery as it pertains to both internal and external security.

Though vested with substantial powers, the Afghan intelligence community has become heavily politicized and suffers from a lack of investment coupled with an old and inefficient bureaucracy. Afghanistan’s intelligence collection efforts are primarily focused on gathering HUMINT through long-standing networks of tribes, local commanders, traders, and government employees. This HUMINT is augmented with basic signals intelligence (SIGINT) collection capabilities.

The Five Eyes countries (the U.S., U.K., Canada, Australia, and New Zealand) have done much to transform the Afghan intelligence community. However, more needs to be done to create professional, disciplined, and adequately equipped intelligence services. At present, arbitrary political appointments, a lack of professional intelligence schools, and the ongoing politicization of Afghanistan’s intelligence agencies have profoundly undermined their institutional integrity and credibility.

The Institutional History of Afghan Intelligence

Intelligence collection and analysis as organized tradecraft is a relatively new phenomenon in Afghanistan. It started with the creation of the Edara e Zabt Ahwaalaat of the 18^th century King Abdul Rahman Khan. The founding father of modern Afghan intelligence is former Prime Minister and President Sardar Dawood Khan; he transformed Edara Zabt Ahwalaat Sedarat to establish the first-ever State Intelligence Services—Edara Estikhabarat Dawlati. This agency was later ideologically refined as communist governments took power with the help of the Soviet KGB, and renamed as KAM, AGSA, and KHAAD.

Today, a significant number of Afghan intelligence agents and officers are graduates of KGB training centers in Russia and former Soviet republics or satellite states such as Uzbekistan, East Germany, and the former Yugoslavia. Furthermore, police and military intelligence agencies were established during the communist period to conduct surveillance on political opponents, conduct counterintelligence operations and gather intelligence on criminals and crime syndicates in major urban centers.

The institutional history of the Afghan intelligence community has created legal and policy frameworks that are in dire need of reform. Updating and revising these frameworks to define and clarify the authorities, responsibilities, and roles of the various intelligence agencies is essential to safeguard their legitimacy, integrity, and professionalism. At present, there is considerable overlap between the mandates and activities of Afghanistan’s military and civilian intelligence, especially in the areas of intelligence on criminal or terrorist activities, tactical-level intelligence, and strategic intelligence. These overlaps need to be clarified through a comprehensive, cross-agency review, which will serve as a road map for subsequent updates and revisions to the legal and policy frameworks used by the Afghan intelligence services.

Furthermore, robust investment is required to upgrade and equip intelligence training schools in the military and civilian sectors. These schools should be the Afghan intelligence community’s sole supplier of human capital to ensure job security, professionalism, and discipline while avoiding any politicization of the intelligence services. The only political appointees in positions of authority in the Afghan intelligence community should be the Director of the NDS and his first deputy; both should have a term limit of two to three years. The career professionals in the services must be immune from political appointments, while service chiefs and NDS personnel who have been discharged from service should be prohibited from engaging in any political or business activity for ten years. This will ensure that sensitive information they may have had access to will not be used for political or financial gain.

There is also the fact that the NDS is spread too thin. As such, there is a dire need to establish three new intelligence agencies: a foreign intelligence agency, a counter-intelligence agency, and a joint intelligence committee consisting of the various intelligence service chiefs chaired by the President of Afghanistan. This improved institutional arrangement will clarify the roles and responsibilities of each agency, improve oversight, increase inter-agency coordination, and enable each agency to better focus on its core mission.

The Intelligence Cycle and Modus Operandi

Afghanistan’s intelligence services currently lack a coherent methodology governing the collection and analysis of intelligence, and the delivery of final intelligence products. Little attention is paid to analyzing and corroborating raw intelligence, which is often presented as a final product. These shortcomings are primarily due to a lack of a coherent institutional culture and the absence of a system of intelligence development. The modus operandi of the three existing services needs to be upgraded with the right systems, procedures, and personnel. This process can start with the implementation of a robust intelligence development cycle, and clarification as to the roles and responsibilities of various agencies, and of departments within each agency.

Furthermore, the Afghan intelligence community would benefit from higher numbers of western-trained intelligence officers. Retirement incentives should be offered to older, KGB-trained officers. At the same time, existing intelligence training schools in Afghanistan need to update their curricula and increase their enrollment as older officers retire and demand for new officers rises.

Information Sharing and Coordination

While secrecy and information compartmentalization are fundamental aspects of the intelligence tradecraft, timely and effective sharing and coordination of information is an ongoing challenge for any intelligence service. While many improvements have been made with the establishment of coordination centers such as TAWHEED, PICC, and NASRAT, more needs to be done at the tactical and operational levels.

The fall of the provinces of Kunduz and Ghazni are examples of intelligence sharing failures in Afghanistan. Agencies were unable to coordinate and share intelligence regarding imminent Taliban attacks promptly. Information needs to be distributed in an efficient and timely manner to those with the proper capabilities to address the issue. Optimized inter- and intra-agency information sharing capabilities will change the face of the Afghan war.

Foreign Partnerships

Partnerships with external intelligence services are essential. Given Afghanistan’s geopolitical circumstances, the Afghan intelligence community can not afford to rely on a single partnership. Instead, it should diversify its foreign partnerships while distinguishing between strategic and non-strategic partners. The United States and the other Five Eye countries are examples of strategic partners.

The Afghan intelligence services should structure its foreign partnerships in three tiers. The first tier would be Afghanistan’s principal partners, such as the U.S. and the Five Eyes countries. The second tier should be comprised of the intelligence services of India, Russia, China, and neighboring countries. The third tier would include the rest of the world.

Paramilitary Forces

Like all intelligence agencies, Afghanistan retains a paramilitary force that is tasked with carrying out quick and effective counter-terrorism operations. These forces have been essential for actions taken against the Taliban, foreign terrorists, and Daesh (Islamic State, ISIS, ISIL). In the event of a reorganization or restructuring of the Afghan intelligence community, these forces and their operational capabilities should be maintained due to their critical role in counter-terrorism.

There is a critical need to improve inter-agency coordination when it comes to operational targeting, planning, and execution with other branches of Afghanistan’s security services. Due to the sensitive nature of operations carried out by paramilitary forces, there are often duplicate or overlapping operations. However, structures such as the Joint Services Operations Command (JSOC) can play an essential role in avoiding redundancies regarding efforts and resources.

SIGINT vs. HUMINT in Hybrid Warfare

The Afghan conflict has changed from insurgenct-proxy warfare to a hybrid war much like the ongoing conflict in the Donetsk and Donbass regions of Ukraine. Alongside covert involvement by Russia and Iran, Pakistan has employed a combination of proxy groups, psychological warfare operations (PsyOps), and economic blockades against Afghan forces, while simultaneously discrediting U.S. and NATO operations in the country. Much of the SIGINT Afghanistan has access to is provided by the U.S.-led coalition forces.

Afghanistan’s intelligence services primarily focus on developing intelligence products utilizing HUMINT capabilities and assets, albeit without much success given the significant number of attacks in major cities and military installations. A robust overhaul is needed to reform and develop full-spectrum capabilities that will enable Afghan government forces to counter hybrid warfare tactics employed by the Taliban and their foreign backers. Integrating HUMINT and SIGINT is a critical step that will improve the efficacy of intelligence products on the battlefield. The Afghan war won’t be won by drones, PC-12s, and other aerial capabilities alone; ground-based networks and sources can have a significant impact when coupled with the proper capabilities and resources.

Oversight and Control

During the eighties and nineties, the Afghan intelligence services—KAM, AGSA, and KHAD—were notorious for atrocities such as arbitrary arrests, mass executions, and forced disappearances. The predecessor of these agencies, Edara e Zabt Ahwaalaat Sedarat, was a tool used for domestic surveillance of political opponents and dissidents of Afghanistan’s kings. Accordingly, intelligence and spycraft are looked at with suspicion by the Afghan people, as it brings back memories of KAM, AGSA, and KHAAD. Thus far, the NDS has been successful, to an extent, in its efforts to improve its reputation, but much more needs to be done.

The Afghan intelligence community’s budget is in need of a robust legal and policy framework to ensure accountability, both operationally and fiscally. In a democratic state, intelligence agencies are required to operate within the rule of law and uphold values like human rights. To their credit, the National Directorate of Security and its sister agencies have done much in this area, but more is required to improve their reputational standing. Measures such as quarterly reports to the parliamentary intelligence committee, ensuring access to detainees by domestic and international human rights organizations, and robust oversight by and reporting to the presidency and the National Security Council are all measures that would contribute to an increase in public and international confidence in Afghanistan’s intelligence apparatus.

Information Trade and Budget Controls

Information is an asset, and if corroborated and verifiable, can be a game changer for Afghanistan. However, there is much more disinformation and rumors than solid, actionable intelligence. Raw data that is not put through a proper intelligence cycle before being included in a final intelligence product is virtually useless. In the intelligence tradecraft, most of the raw information turns out to be rumors and uncorroborated hearsay.

Meanwhile, large sums of money are spent to develop sources and produce intelligence products with little parliamentary or presidential oversight. The operational budgets of all three existing services under parliamentary and presidential oversight need to be assessed using a cost-benefit analysis that weighs the value of final intelligence products against the costs required to develop those products. While a degree of secrecy surrounding the budgets of intelligence services is warranted, there must be proper oversight to provide a check-and-balance mechanism to monitor corruption, inefficiency, and ensure a positive return on investment.

Intelligence in War: Fixing and Fitting Intelligence in the Afghan War was originally published on Global Security Review.

A Chinese cybersecurity expert might have let the “cat out of the bag.” Writing in the People’s Liberation Army (PLA) Daily, the author highlights how a component of Bitcoin technology known as “blockchain” (区块链) will have “military applications,” adding “there is no doubt that the future of media war must rely on a specific network media to start.”

More troubling though is that it was written specifically for the Chinese military as a specific call to action: “the media battle of wars will become an important form of future military struggles. If we do not take precautions in keeping with the pace of the times, we will be subject to control everywhere.” The PLA author is 100 percent correct, but does this mean the West should allow China take control of the “media battle of wars”?

Whichever countries successfully harness this emerging blockchain technology for military and intelligence operations in the 21st century will likely determine their future level of international influence and power. What exactly is blockchain and what are its implications for gray zone warfare?

To the layman, discussions on some new Bitcoin technology (e.g., blockchain) influencing military and intelligence operations in a pivotal way may sound preposterous. However, blockchain when integrating into a specific national strategy has the potential to fundamentally alter the future of relations between states, societies, and citizens. If properly utilized as a national security instrument by the Chinese (and others), it can undermine Western governments by subverting standard mechanisms that detect criminal and subversive activities.

The Importance of Blockchain

To those unfamiliar with the subject, “blockchain is considered the main technological innovation of Bitcoin.” The rise of cryptocurrencies, such as Bitcoin, and the ability to authenticate and provide payment anonymously in a secure way relies on a “distributed ledger technology” enabled by blockchain. As identified by three Chinese researchers in a 2016 article titled  “Blockchain technology and its potential military value” (区块链技术及其潜在的军事价值]) in National Defense Science & Technology, the authors highlight the value of blockchain technology, noting the numerous security ramifications, especially in the realm of defensive and offensive operations. Also, as written in a China Management Informationization article, blockchain supports “trustworthiness, reliability, openness, consensus mechanism and smart contract” in business transactions and other dealings where discrete payments are needed.

Scholars in India are similarly concerned about blockchain supporting the conduct of military operations, with one author recognizing that as governments and individuals develop quantum computing abilities, blockchain will make it easy to hack into highly secure networks. Such writings by foreign scholars suggest that blockchain will change the way countries alter the battlespace in their favor without even being detected. However, it is ironic that China recently announced a ban on cryptocurrencies, while their experts are advocating for ways in which to weaponize Bitcoin technology for war.

Blockchain presents an opportunity for numerous uses in the military and intelligence communities. The technology neatly into the paradigm of warfare in the ’Gray Zone,’ where Chinese aggression defines the “ambiguity — about the ultimate objectives, the participants, whether international treaties and norms have been violated, and the role that military forces should play in response.” The uncertain nature of gray zone warfare is what makes blockchain so appealing as a tool. Adversarial governments and extremist groups can utilize it – with little fear of being caught “red-handed” – to further their interests at the expense of other countries unwilling or unable to stop it.

Blockchain in the Gray Zone: China Attacking Western Civil Society?

A U.S. Naval Officer, writing for The Jamestown Foundation, is rightly concerned that blockchain technology “has been recognized as having intrinsic value and utility for Chinese defense issues,” and “would align with the civil-military application goals tied to the broad informatization (信息化) campaign” espoused in China’s 2015 Military Strategy.

If we accept the notion that China is a rising power, then we should also accept that – much like other historical “rising powers” – China will increasingly want to exercise its instruments of national power in military, economic, and political spheres. If China is seeking to increase its regional hegemony in the Pacific, and gray zone actions in the South China Sea are any indication of future behavior, then recent gray zone attacks against Australia and New Zealand indicate how blockchain might work on a global scale, and against the interests of the U.S. and her Western allies.

Research on Chinese “influence campaigns” in the Pacific by a professor in New Zealand has already drawn substantial international attention, not just for her findings, but because of what China did to her. As far as anyone can tell, her articles touched a nerve with Beijing, with Chinese agents appearing to intimidate her. The reason why China had every reason to worry about her work was that she specifically identified Chinese actions to influence opinion in Australia and New Zealand on China by subverting their political system.

The author discovered the paper trail of money leading back to China (and their corporations), whereby China was giving substantial amounts of money numerous political parties in Australia and New Zealand. China was also financially courting current (and former) government officials and public intellectuals in each country as a way of undermining public debates about China.

Their campaign has chilling ramifications for how blockchain could make future Chinese operations impossible to uncover or detect, as they will likely continue their subversive operations against any countries that might oppose their rise to power.

What I am about to propose is purely speculative, but if we perceive the “Sharp Power” actions by China as an attempt to undermine civil society and democracy in the West, then the “Gray Zone” war is about to escalate and shift in favor of China.

Speculative blockchain uses could entail:

1. For espionage purposes, China could securely pay significant sums of money to trusted agents in Western societies that would be effectively untraceable. Such Chinese intelligence agents could – depending on the blockchain encrypted communications – pursue actions meant to sow disunity or political polarization. This could come in the form of providing significant monetary contributions to extremist political parties on the left and right side. This would be quite a remarkable strategy and shift in tactics because instead of trying to support civil society groups and organizations towards the preferences of China, such an approach would just overall weaken the country as polarized politics would make it difficult to respond to growing Chinese power because Western politicians would be too divided and fragmented to mobilize an adequate response.
2. Blockchain security protocols, if properly implemented by Chinese intelligence and security agencies would essentially make their state secrets impenetrable. While I am not suggesting that the West should be trying to electronically infiltrate Chinese systems in an offensive fashion, it would at least serve as a future deterrent to Chinese cyber actions. Already China has been identified on numerous occasions for conducting information collection operations (i.e., stealing classified and sensitive business information) that have relied on cyber warfare tactics to steal technology from Western governments, militaries, and commercial companies (to include the military-industrial complex). 
3. If the West were to attempt an information war within China, the authentication protocols provided by blockchain would make it nearly impossible to create and spread “fake news.” However, if the West did not use blockchain defensively, then China could create confusion in Western societies by distributing “fake news” through trusted Western media outlets. This could damage public debates about societal problems and international politics as each side of the political spectrum could be “duped” into believing false grievances and cleavages, which would undermine the policymaking process throughout all levels of government.

Each of these hypothetical scenarios suggests are within the realm of possibility. China could integrate blockchain into their security and intelligence operations as a way of leveraging American structures against the U.S. and her allies.

Conclusion

Disruptive blockchain technology is coming – whether or not we want it. There are staggering implications for gray zone warfare, especially from China and other hostile adversaries using Bitcoin technologies against the U.S. and her allies. Western defense communities will need to handle this and acknowledge the troubling reality that gray zone warfare will be harder to detect and deter. Moreover, besides state threats, Bitcoin technologies also make it easier for terrorist groups and violent non-state actors (e.g., criminals, gangs, etc.) to operate as it is almost impossible for security

Luckily, the West is not entirely unprepared about blockchain applicability for military uses: the Pentagon is looking into securing databases, the American Defense Advanced Research Project Agency (DARPA) is developing a secure battlefield communication system, and Estonia has rebuilt its government around the technology. These are promising signs, but whoever weaponizes blockchain the fastest (i.e., establishing supremacy in this emerging technology), will undoubtedly achieve the sought after Monroe Doctrine in Cyber Space.

However, much is left to be done with trying to modernize defense systems in the West using blockchain. Moreover, there is a need to ‘harden’ and ‘strengthen’ civil society against foreign subversion that might rely on blockchain to create and spread fake news (i.e., propaganda). Additionally, the prospect of untraceable monetary donations to influence important individuals, politics, and policies in the West, poses tremendous challenges to the workings of liberal Western democracies.

While my three blockchain examples were hypothetical, there is no evidence to suggest this has occurred yet. Unfortunately, from a logical and intuitive position, these are entirely within the realm of reality, especially in a gray zone war context of the 21st century. Hard military power appears to be exercised less by rising powers such as China, and thus far, Chinese behavior in the international community appears bent on shaping narratives, politics, and negotiations in favor of their own interests.

Is China Weaponizing Blockchain Technology for Gray Zone Warfare? was originally published on Global Security Review.

Over the past year, both the Australian and New Zealand governments have faced reports that the Chinese government has gained influence in their political systems, universities, and media markets. So far only Canberra has responded firmly. Australia’s domestic intelligence agency, the ASIO, wrote in its annual report to parliament this year that it believed foreign governments are trying to extend their influence [PDF] in Australian society, posing “a threat to our sovereignty, the ­integrity of our national institutions, and the exercise of our citizens’ rights.”

Specifically, the intelligence service believes businesspeople with strong ties to Beijing and a desire to push pro-China views have been donating millions to the country’s two major political parties. The agency had already delivered a warning in 2015 to the country’s largest political parties about what Fairfax Media called “Chinese interference in Australian politics via massive cash donations.” Despite the warnings, significant political figures in Australia continued to take hundreds of thousands of dollars from these donors. A new analysis by Melbourne Law School’s Dollars and Democracy Database found that, between 2000 and 2016, about 80 percent of foreign political donations to Australia’s parties came from China.

China’s influence campaign appears to have extended further in Australia. China’s state security forces have reportedly engaged in a battle to monitor Chinese nationals, including many students, there—even warning them not to offer any criticism of Beijing lest their relatives in China be harmed. The ASIO and senior officials around Prime Minister Malcolm Turnbull have begun questioning whether the threat of monitoring students and tactics taken by Chinese officials to scrutinize teaching on China in classrooms has censored debate about China within Australian higher education. The intelligence service’s head, Duncan Lewis, told parliament in October that Canberra has to be “very conscious of the possibilities of foreign interference in our universities.”

Chinese state media have created joint ventures in recent years with prominent Australian Chinese-language news outlets, ensuring that they publish stories from Beijing’s state press. Beijing has also established centers for Chinese language and cultural studies, including Confucius Institutes, that some academics have claimed censor criticism of Beijing. The Guardian recently reported that one of these institutes was established within an Australian state government, sparking concern among some intelligence specialists that a Chinese state-linked actor was working in the Australian government.

These reported moves to influence political debate in Australia come at a time when Chinese leader Xi Jinping is overseeing a strategic shift in how Beijing interacts with the world. Unlike his predecessors, Xi is not shy of announcing that Beijing intends to wield global power—power he wants to use to push China’s strategic and economic objectives and to have influence in other states’ domestic politics. China’s increasingly bold approach is rattling Australian politics and leading Canberra to rethink its laws on foreign funds flowing into politics, business, and educational institutions. For its part, China rejects the claims of interference surfacing in Australia, New Zealand and elsewhere, calling them “disgraceful” and “symptoms of McCarthyism” in an editorial published in the Global Times in December.

Influence Campaign in New Zealand?

New Zealand faces a similar challenge. Earlier this year, Anne-Marie Brady, a professor at the University of Canterbury, released a bombshell report documenting numerous ways Beijing has gained influence in New Zealand politics. Brady reported that Beijing has worked to place pro-China individuals in the leadership of ethnic Chinese associations in New Zealand, and has managed donations to the country’s political parties.

Brady believes these strategies have been effective in convincing Wellington to adopt what it calls a “no surprises” China policy of only raising controversial issues in private with Beijing. Meanwhile, the Financial Times and the New Zealand news outlet Newsroom reported this year that Yang Jian, a leading member of parliament from the National Party, had a military intelligence background in China that he failed to disclose when he immigrated to New Zealand and that he has pursued close ties with an organ of the Communist Party in Beijing. Yang has reportedly pushed the National Party—which led New Zealand’s government between 2008 and this year—to implement closer links with Beijing.

China has significant reasons for launching and expanding political influence campaigns in Australia and New Zealand, two democratic societies that are open to trade, immigration, and foreign cultural influences. The two countries have in recent years become increasingly economically dependent on China. China is Australia’s largest trading partner. In 2008, New Zealand became the first developed nation to sign a free trade deal with China, which is now New Zealand’s biggest goods-trading partner and second-biggest services-trading partner.

Exporting the ‘China Model’ and Exploiting Open Societies

In addition to pushing for China to wield more influence in other nations, Xi has also cited Beijing as a model for other countries, a step his predecessors were wary of taking. In October, the Financial Times reported that Xi’s administration had tasked the United Front Work Department, a part of the Communist Party that handles foreign influence duties, which the Times said involved using “Chinese power to charm, co-opt, or attack well-defined groups and individuals” abroad. The U.S. Congressional-Executive Commission on China will hold a hearing this month on Beijing’s attempts to wield influence in the United States.

Under Xi, Chinese embassies around the world have increasingly been tasked with monitoring China-born students who attend foreign universities. Meanwhile, by setting up new influence programs and upgrading its global media, the Chinese government has boosted its resources for influencing journalists, cultural figures, and ethnic Chinese associations abroad. For instance, in 2012, Beijing set up the Chinese Public Diplomacy Association (CPDA), which brings journalists and opinion leaders to China for training.

Xi’s administration has devoted extensive new resources to globalizing China’s state media outside of the Asia-Pacific. In 2009, Beijing announced it was devoting $6.5 billion to upgrading its state media networks. (The United States, by comparison, spends roughly $700 million annually on state-funded international broadcasting.) Beijing is modernizing its global state television channel, CGTN. The official news agency Xinhua, meanwhile, is adding bureaus around the world, including in the United States, at a time when many major news organizations in developed democracies are shedding staff due to financial pressures.

Regional Security Overtones

China’s political influence could have significant strategic and economic ramifications. Australia is one of the United States’ closest allies. Any lasting tilt by Canberra away from Washington would have seismic consequences throughout the Asia-Pacific. Australia and New Zealand are both members of the Five Eyes intelligence-sharing network that also includes Canada, the United Kingdom, and the United States, and any penetration by Beijing of senior levels of government in one Five Eyes member state would worry the others.

Wielding more significant influence in Australia and New Zealand could also allow China to apply pressure on the two nations, which are regional leaders, to stay neutral on disputes in Southeast Asia. In recent years, New Zealand leaders have become reticent about disputes in the South China Sea. Australia has thus far declined to join U.S.-led freedom of navigation operations there and has repeatedly stated that it will not take a side in disputes over the sea. And if more people in Australia, New Zealand, or other countries consume information that derives from Chinese state media, it could reshape narratives about Chinese policies in those nations.

In one notable instance, prominent former Labor Party Senator Sam Dastyari told the Chinese media last year that Australia should not involve itself in China’s activities in the South China Sea—even though Beijing claims nearly the entirety of the sea. After Dastyari made the remark, media outlets revealed that he took this position after a major, pro-China donor who had paid Dastyari’s legal bills in the past had threatened to pull a $400,000 donation to the Labor Party. Amid the controversy, Dastyari quit his post this month, and the Washington Post reported that Peter Dutton, the health minister, accused Dastyari of “being a ‘double agent’ of China.” Australia’s ethnic Chinese associations also apply pressure regarding the South China Sea. The Sydney Morning Herald reported in 2016 that, before Malcolm Turnbull made his first visit to China as prime minister, “some sixty Chinese community leaders in Australia gathered in Sydney urging him to watch his words when discussing the South China Sea in Beijing.”

Public polling, meanwhile, suggests that China’s efforts in Australia and New Zealand may be working. In a Pew Research Center study released this year, China was viewed favorably by 64 percent of Australians, up from 57 percent two years ago. And a poll this year by Massey University and the New Zealand news website Stuff showed that, if given a choice to build closer bilateral ties with the United States, the United Kingdom, or China, a plurality of New Zealanders would choose China.

Managing Bilateral Tensions

While Australia has begun to develop a robust response, it faces the challenge of protecting its strategic interests while being careful not to stigmatize Chinese-Australians. In addition to Australia’s top intelligence agency increasing its investigations into Chinese influence, the Australian Foreign Investment Review Board has begun applying greater due diligence to investments. Australia’s ruling political coalition will pass legislation banning foreign donations to political parties and activist groups in the country, and force anyone representing foreign interests in Australia to register as such, in a manner similar to the U.S. Foreign Agents Registration Act.

New Zealand has been slower to develop a clear response. Prime Minister Jacinda Ardern has reportedly refused to comment on the prospect of the country’s spy agency launching a probe into Chinese political influence in New Zealand. The Financial Times reported in December of this year that briefings provided to Ardern by New Zealand national security chiefs have raised fresh concerns about political interference coming from Beijing.

Even for Australia, reckoning with forms of influence other than funding political parties or individual politicians will be hard. Many soft power efforts are seen by publics as benign, and as having positive cultural benefits.

Still, in Australia, it seems unclear whether China’s efforts will have the long-term effect of actually bolstering bilateral ties, or will instead lead to cooling between Canberra and Beijing. Australia is stepping up its defenses against China—perhaps not what Beijing wanted. As the Turnbull government has spoken out about some of Beijing’s influence efforts, and Canberra has moved to pass laws on foreign donations to politicians, Chinese elites have become increasingly skeptical of and even angry at Australia, as the Lowy Institute reported last week. This growing mistrust means that China’s influence strategy there could backfire.

Australia & New Zealand Face China’s Influence was originally published on Global Security Review.